By Paul DeGroot [bio]
Posted: Sep. 18, 2006

• Chart: Customer Campaigns for 2007
• Sidebar: What's in a Customer Campaign?

The following is the full text of an article published by Directions on Microsoft, an independent research firm focused exclusively on Microsoft strategy & technology. More samples of our content, as well as a list of upcoming articles and reports are also available.

The marketing frameworks that Microsoft uses to bring products to market are shifting from Go-To-Market (GTM) campaigns to Customer Campaigns. Like GTMs, the new campaigns define the main messages the company wants to deliver, its target audiences, the role that partners play, and how specific products fit into this structure. However, Customer Campaigns are intended to reach more broadly across product groups, target Microsoft's marketing more directly at actual customer needs, let Microsoft adjust more quickly to market conditions, give Microsoft subsidiaries a larger role in marketing, and give marketing issues more prominence in product development.

Frameworks for Marketing

Microsoft's marketing efforts typically include substantial research into customer and market behavior, resulting in a hierarchy of advertising, sales, and public relations materials ranging from very broad (e.g., nationally advertised) "air cover" intended to burnish Microsoft's image to detailed "battlecards" that its field sales people use in customer meetings. The company also produces seminars, case studies, demos, videos, brochures, white papers, and other marketing collateral for partners and customers. The marketing collateral for a single product can include hundreds of items, whose numbers multiply further as they are translated and adapted for local markets.

To bring some order to its gargantuan marketing task, Microsoft has created marketing frameworks aimed at organizing the company's marketing and sales teams around common goals, and supplementing external marketing campaigns, such as the "People-Ready Business" campaign.

One type of framework was the GTM, which Microsoft began developing beginning around 2002 and helped focus marketing efforts on what Microsoft perceived to be the best opportunities for its products. For its 2007 fiscal year, which began on July 1, 2006, Microsoft has replaced GTMs with Customer Campaigns. They resemble GTMs in many respects, and their final impact on the marketplace may not be dramatically different. (For a list of Customer Campaigns, see the chart "Customer Campaigns for 2007".)

However, Customer Campaigns, as their title suggests, have a stronger focus on identifying and responding to particular classes of customer. The company's marketing research has tried to identify individuals who play a significant role in software purchases, the problems that concern them most ("pain points" in Microsoft's parlance), and what message from Microsoft will convince them that the company has the answer to their problems. To literally give these people a face, Microsoft's marketing teams have developed more than 100 "personas," such as "Joe the financial analyst" and "Suzie the order entry clerk," who come complete with names, photos, and more: the company has hired and trained actors to represent personas at some events.

Other differences between GTMs and Customer Campaigns include the following:

Spanning business groups. GTMs were generally owned by a particular business group, which narrowed their scope and created problems for the sales force, since customers don't organize their businesses or IT infrastructure along the lines of Microsoft's business groups. Customer Campaigns can span business groups, combining mobility products from the Entertainment and Devices group with Office and Exchange from the Business group, for example. Though an obvious benefit, this is no small achievement in a company where product boundaries have often been guarded jealously.

Longer duration. Customer Campaigns are not limited to one fiscal year, which can reduce marketing costs, such as the cost of developing new collateral every year.

Looser product links. Because the focus of a Customer Campaign is a particular type of customer (e.g., a small business owner in the healthcare industry), Customer Campaigns can be designed independently of product launches (although the launch of significant new features can prompt changes in campaigns that include the product). Customer Campaigns are also more likely to be positioned as an answer to a customer problem, while GTM marketing collateral was developed to highlight product features—in some cases those features, though interesting to the product group, lacked a compelling connection to customer requirements.

More subsidiary input. Microsoft is likely to create many more Customer Campaigns, and they already appear to be better focused than GTMs. This leaves open the possibility that campaigns could be developed that address non-U.S. markets. The company plans to give subsidiaries more discretion about which campaigns they emphasize and how they customize them for their markets. That was more difficult with the product-focused GTMs: leaving a GTM off the local agenda may have left a major product without a local marketing campaign.

More consistent messaging. GTMs could sometimes overlap because of their vagueness and generality (including mind-numbing names, such as Connected Productivity Infrastructure, or Operational Efficiency and Productivity), and some GTMs were aimed at IT staff while others were aimed at executives, creating potential confusion and duplication. Customer Campaigns' focus on particular customer profiles and problems makes it less likely that they will overlap, and many Customer Campaigns include subsets of messages for different audiences (e.g., one version for a marketing vice president and another for an IT administrator), which will ensure greater consistency.

More relevant to the sales force. Microsoft's field sales staff are currently organized around customer segments (e.g., small, midmarket, and enterprise) and industry verticals, while Microsoft's headquarters is organized around product groups. GTMs were owned by specific groups, while Customer Campaigns are less restricted by internal boundaries, which will let the company better tailor its marketing for specific customer segments and verticals.

(For a list of some of the components that are defined for Customer Campaigns, see the sidebar "What's in a Customer Campaign?".)

Impact of Customer Campaigns

Both Customer Campaigns and GTMs are entries in a long record of Microsoft marketing programs that attempt to transcend products with broader solutions, but a focus on products is firmly entrenched in the company's hierarchy and history. It remains to be seen whether Customer Campaigns will succeed where previous initiatives have not. Areas that still need refinement include determining which campaigns get priority, the role that partners play, and the impact that marketing issues will have on product development.

Defining a Customer Campaign

While Customer Campaigns imply that Microsoft identifies a customer problem and develops a solution for it, it will take time for the company to escape its more traditional practice of creating products and then figuring out the best way to sell them to customers.

In particular, what will happen when Microsoft doesn't have a solution or product that meets a customer's requirements? How will the company recognize such needs, and will it launch a Customer Campaign with alternatives, such as partner products, that do address it?

The long-running character of Customer Campaigns should help in this regard. While some Customer Campaigns may last for only a year, the number of campaigns could grow substantially over time as partners and customers weigh in on other needs that Microsoft should be addressing with a product and marketing framework.

Partner Roles

GTMs gave a very prominent role to partners, and some executives called it "partner-led" marketing. The company's global ISVs and integrators were specifically invited to participate in GTMs, and the company featured their logos and information about their solutions as part of GTMs.

The role of partners in Customer Campaigns is not as clear. These campaigns identify the types of partners (such as business intelligence integrators) that Microsoft wants to involve in campaigns, but they don't single out specific partners who are particularly qualified to deliver the solution. Customer Campaigns did not play a prominent role at the company's July 2006 partner conference, so it is unclear how partners who want to participate in a campaign can climb on board and benefit from Microsoft's marketing resources or demand generation activities.

However, the design of Customer Campaigns could give partners some new opportunities. For example, Microsoft has often lagged behind smaller, nimbler firms as new markets opened up or new technologies appeared on the market. The company could develop a campaign to respond quickly to a new opportunity by incorporating partner-developed applications, and it could sell or promote those applications (running on Microsoft platforms such as Windows and SQL Server) while its own product strategy caught up. Such a response was unlikely with GTMs, which were owned by business groups and were built only around Microsoft products.

A campaign that is able to reach the market more quickly because it takes advantage of work already done by partners could ensure that Microsoft, its platforms, and its preferred protocols capture a significant niche in a new market, and could prevent a newcomer or a competitor from setting standards that Microsoft could be forced to follow. However, the risk for a partner in such a scenario is that Microsoft would eventually develop its own solution, resulting in a lesser role for the partner.

Marketing and Products

Perhaps the most significant element in Customer Campaigns is that they may signal a shift in power from product groups to marketing.

As a programmer-led company, Microsoft has historically given its product development groups considerable discretion in deciding which features will be included, often without a clear link to customer needs. For example, customer needs did not play an obvious role in the early development of Vista, which was initially dominated by major architectural leaps such as new APIs and a new file system. These were interesting to OS programmers, but few business customers could connect these advances in technology to their business needs.

Customer Campaigns, with their emphasis on identifying and resolving customer pain points, could push technical breakthroughs into the background unless they're clearly linked to customer needs, and could give market research a much greater role in defining future product features and roadmaps.

Resources

Shifts in Microsoft's marketing organization were described in "Marketing at Microsoft" on page 41 of the Nov. 2005 Update.

Go-to-Market campaigns were described in "Going to Market, Microsoft Style" on page 30 of the Feb. 2005 Update.

The 2005—2006 reorganization of Microsoft's U.S. enterprise sales force was described in "Enterprise Group Tightens Customer Relationships" on page 31 of the Nov. 2005 Update.