Microsoft is planning a radical new strategy to give retailers a substantial slice of the Vista upgrade action when the OS lands by year's end.
The software giant plans to heavily promote the higher end and more profitable editions of Windows Vista, which would ship in four 'core' retail versions - Home Basic, Home Premium, Business and Ultimate.
"One of our key goals is to drive the premium SKUs," said Dave Block, senior product manager for Windows Vista Marketing, during a presentation during the recent Intel Developer Forum in San Francisco.
Block identifies the Vista Home Premium and Vista Ultimate as the high-margin parts of the mix.
"We want to hit a 50 percent run rate on Vista Premium in those first 24 months. That's a substantially more aggressive run rate than we were able to hit with XP [Professional]."
To help direct sales to the top end, Microsoft would split its "Designed for Windows" logo program into to 'basic' and 'premium' badges.
The basic logo will be available to all hardware, software and peripherals that fulfil the minimum system requirements for working with Vista. The premium badge is reserved for products that can make the most of Vista's advanced capabilities.
"We're going to use that premium logo as a call to action, whether it's on a software box or a personal device or a PC," Block says. "Our goal will be 50 percent of premium logo systems and premium logo devices [at launch]."
Retailers would have to rethink the way they sell their wares - and allocate their floor space to benefit from the plan.
Microsoft's marketing campaign would hinge on scenarios built around real-world experiences rather than individual features of the OS.
"We want to have these scenarios showcase Vista features that differentiate the user experience from what it is today under Windows XP."
Block says that Microsoft has flagged 14 go-to-market scenarios spanning the consumer, SMB and enterprise segments.
In many cases, however, retailers would be expected to change their store layouts. As an example, Block cited research indicating "digital photography is the biggest driver of PC upgrades today".
"But when you walk into a store today there's a row of printers on the left-hand side, and they're all competing on price. Then there's a row of digital cameras on right-hand side, and they're competing on megapixels and price.
"We want the consumer to walk in and see the Windows Vista digital memories area where there are cameras, printers, photo management software and online services. They'll all have the premium logo and will all be grouped together - all those pieces will be part of the digital memories story. So we'll be looking at who are potential partners for digital cameras, memory cards, printers, software, online service providers," Block says.
"A digital memory ties into Vista features like metadata, connectivity, management of your photo library and web photo services. And that's where we're working with retail partners to bring our marketing message to consumers."
Microsoft plans Vista retail blitz
By David Flynn on Mar 20, 2006 9:37AM