Microsoft plans retail articulation of value proposition

That's Microsoft-speak for: we're opening our own shops. Now it needs to work out what to put in them.

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Last Updated: 06 Nov 2012

The software giant has hired veteran retailer David Porter to develop and roll out a new Microsoft-branded retail chain, in a clear bid to replicate Apple’s success in opening up a lucrative new revenue stream on the high street. Microsoft hasn’t yet decided how many shops there’ll be, or where they’ll be situated, or when they’ll open, or even what they’ll sell. But it’s definitely keen on using shops to ‘create a better PC and Microsoft retail purchase experience for consumers worldwide’, which apparently is the key thing. So now all it needs is a range of desirable products, a flair for visual design and some retail experience, and it can be just as cool as Apple.

Microsoft is hoping that Porter will at least take care of the last angle. Its new corporate VP spent 25 years with US retail behemoth Wal-Mart, where he ‘served as a strategic point of influence throughout the Wal-Mart business’ (whatever that means) before moving to Dreamworks Animation studio as head of worldwide product distribution in 2007. According to Microsoft, when he settles into his new office on Monday, his first task will be to define the ‘time frame, locations and specifics’ and other such minor details of the new chain. Which is good, because we’d hate to think he’d be too shackled by existing orthodoxy...

So why does Microsoft think it needs shops? Well, its press release talked sagely about its desire ‘to create deeper engagement with consumers and continue to learn firsthand about what they want and how they buy’ – which presumably means trying to work out more ways to flog them new versions of Windows and Xbox games. Apple has made huge strides on the high street, selling huge quantities of its iPods, iMacs and iPhones in its iconic gleaming white shops, and Microsoft clearly wants a piece of the action.

However, it’s a radical move for the company, whose success has been built on selling to manufacturers and other suppliers. Since the new high street stores could end up cutting some of these out of the loop, many are likely to be rather miffed about Microsoft’s new strategy. Then again, it’s not like they can just stop buying the company’s products. And clearly Microsoft has to do something: with the move towards cloud computing threatening its traditional model, it needs to look for new revenue streams. Let's just hope that all the shop assistants don't dress up as paper clips and pop out at you when you least want to see them.

But will Microsoft ever have Apple’s consumer-facing savvy? Announcing the move, COO Kevin Turner said: ‘We’re working hard to transform the PC and Microsoft buying experience at retail by improving the articulation and demonstration of the Microsoft innovation and value proposition so that it’s clear, simple and straightforward for consumers everywhere.’ Unlike the company’s prose, then.


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