Microsoft to put its Windows Phone marketing dollars where its mouth is

Microsoft to put its Windows Phone marketing dollars where its mouth is

Summary: Microsoft and its phone partners seem finally ready to put some real dollars (in the hundreds of millions) behind launching new Windows Phones in the U.S. in 2012.

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It's time -- actually way past time -- for Microsoft to start investing some real money behind Windows Phone marketing.

On January 4, reports of exactly how much Microsoft may be ready to spend on marketing the Nokia ACE (a k a, the Lumia 900) in the U.S. began circulating. I'm going to go with my Windows Weekly cohost Paul Thurrott on this one, as he is citing internal Microsoft documentation as his source. He's saying the amount that Microsoft, Nokia and various phone partners are ponying up to spend in the first part of 2012 to push Windows Phone is close to $200 million.

The most interesting part of Thurrott's post (to me, anyway) is about sales incentives.

As many of us "early adopters" of Windows Phone found out the hard way when we went to buy them, many retail sales reps haven't been all that keen on selling Windows Phone, preferring to steer customers to iPhones and Android phones. A big part of the reason for that: They get commissions and gifts for doing so.

Microsoft is finally ready to do the same, it seems. From Thurrott's post:

"Included in the (Microsoft/Nokia marketing plan) plan are sales incentives for retail workers aimed at getting them to finally start recommending Windows Phone as an alternative to Android and the iPhone. The amount of payments are $10 to $15 per handset sold, depending on the number sold, for some handset models."

I have heard from my contacts similar numbers, along with promises of free Xboxes, car steroes, free pizza Fridays and other sales "incentives" thrown in for good measure.

I am stymied as to why it took Microsoft this long to figure out that these kinds of promos and paybacks are what's required in the phone business. Why not just take some of those Android patent royalty fees the company is busy collecting (rumored to be anywhere from $5 to $15 per handset) and use them to grease a few palms?

The Nokia Lumia 900 (ACE) is expected to launch on AT&T in mid-March. The Nokia Lumia 710 (codenamed Sword), is going to be available on T-Mobile starting January 11, and is expected to be on Verizon by mid-April.

Topics: Windows, Microsoft, Mobility, Operating Systems, Software, Telcos

About

Mary Jo has covered the tech industry for 30 years for a variety of publications and Web sites, and is a frequent guest on radio, TV and podcasts, speaking about all things Microsoft-related. She is the author of Microsoft 2.0: How Microsoft plans to stay relevant in the post-Gates era (John Wiley & Sons, 2008).

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45 comments
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  • The Shark Has Been Let Out Of His Cage

    The 10 year long DOJ restraining order on Microsoft ended and was lifted this last summer. Now Gates the world's #1 high-tech shark who still advises Microsoft can go full out in competing with Google and Apple unrestricted by the DOJ restraining order.

    Rumor is that Nokia may be coming out with a Windows 8 tablet in the U.S. It wouldn't surprise me. The Windows 8 Cloud based ecosystem is being built as you read this. The W8 ecosystem will seamlessly connect all devices running W8 from destops to tablets to smartphones etc through the Metro based applications and the Cloud.

    The shark has been let out his cage and he coming for Google and Apple. i worked in the computer industry in the 80s and 90s and was very familiar with the methods that Gates and Microsoft employed to crush their competition. While it will not be that easy this time around I wouldn't bet against Microsoft making significant in roads into areas now dominated especially by Google and Apple.
    Nesivos
    • RE: Microsoft to put its Windows Phone marketing dollars where its mouth is

      @Nesivos Its about time. But Windows Phone is so good it just needs a little push to get the ball rolling.
      jatbains
      • Not to metion DOJ restraining order was nonsense to begin with

        Funny how they had the balls to sue MSFT back then. It's like you sue Michael Jordan for completely dominating you in the basketball yard. The weirdest part was that they actually won thanks to our sad & bizarre anti-business legal system.
        LBiege
      • Sad and bizarre?

        @LBiege
        It is a darned good thing they did, too. There would be no Apple nor Google today if MS hadn't been under antitrust restraints. Those "bugs" would have been squashed long ago. Now that there are two not-so-easily-brushed-aside competitors "in their space" we, the users, will benefit. Note that even if you are firmly [i]in[/i] the MS camp, the fact that they are being forced to compete will mean you, too, will get to use better products.

        The quality of Bing, IE9, Windows Phone, Azure, and yes, the excellent Windows 7 (and hopefully 8) is a [i]direct result[/i] of the antitrust actions taken against MS. Enjoy.

        I don't find that sad nor bizarre at all.
        x I'm tc
  • RE: Microsoft to put its Windows Phone marketing dollars where its mouth is

    Awesome news. I would like to see more WP7 phones on Verizon's network instead of just the one (or 2 this April). Microsoft needs to get Verizon more involved since they have the majority of coverage in the U.S. I'm considering switching to AT&T just because of their line up of WP7 phones.
    Loverock Davidson-
    • Left Verizon for ATT for HTC Titan

      @Loverock Davidson-
      I wanted a serious Windows Phone. It is clear that Verizon is putting most if not all of its efforts behind DROID. iPhone sells itself - the sheeple buy those things. I still have four lines with Verizon, but switched my primary to ATT for the HTC Titan - and it is awesome! Combined with Office 365 - just feel the power!
      jhevener2
    • RE: Microsoft to put its Windows Phone marketing dollars where its mouth is

      @Loverock Davidson-

      This is where I am at, 10 year verizon customer but if they don't offer more Windows phones I will switch to ATT. When I checked out the most recent Windows phone on ATT, I was quite impressed. I get the same corporate discount on ATT as I get on Verizon so it won't cost me to change once my Verizon contract expires. ARE YOU LISTENING VERIZON?!
      hopp64
  • RE: Microsoft to put its Windows Phone marketing dollars where its mouth is

    Mary Jo, i've also been curious why Microsoft simply wasn't taking a percentage of the Android licensing dollars and putting that into a massive marketing and incentive campaign. Just seems like a no brainer to me.

    The free gifts will go over huge too.
    murani
  • RE: Microsoft to put its Windows Phone marketing dollars where its mouth is

    Windows Phone is great and with Windows 8 and its Metro UI on the horizon the future is so bright I gottta wear shades :-)
    jatbains
  • RE: Microsoft to put its Windows Phone marketing dollars where its mouth is

    Mary Jo, this is the first time I have seen it said that sales people sell a lot of Androids and Iphones because " They get commissions and gifts for doing so."

    Where has that story been buried all this time? I read blogs obsessively and have never heard that claimed. Seems to me that that is huge reason why WinPho is behind.
    JimmyFal
    • RE: Microsoft to put its Windows Phone marketing dollars where its mouth is

      @JimmyFal

      'Spiffs' have been around for decades(late 1800s?). Retail sales aren't steered merely by individuals salesman's bias but often by which items generates the most in spiff.
      whatagenda
    • RE: Microsoft to put its Windows Phone marketing dollars where its mouth is

      @JimmyFal - Yes. I am confused too. Usually Microsoft is much faster when copying folks. They really dropped the ball on this one!
      The Danger is Microsoft
    • RE: Microsoft to put its Windows Phone marketing dollars where its mouth is

      @JimmyFal <br>If you had read the link information the incentive was payment of $10 to $15 per Windows Phone handset sold. Reading too many blogs I guess. <br><br>So the only way to get sales staff to recommend the Windows phone is to pay them?
      daikon
      • RE: Microsoft to put its Windows Phone marketing dollars where its mouth is

        @daikon

        And had you read the article you would have read that "preferring to steer customers to iPhones and Android phones. A big part of the reason for that: They get commissions and gifts for doing so."
        whatagenda
      • RE: Microsoft to put its Windows Phone marketing dollars where its mouth is

        @whatagenda
        The most interesting part of Thurrott???s post (to me, anyway) is about sales incentives.

        Note: (to me, anyway) Thats MJs opinion.
        Nothing in Thurrotts post says they get commissions and gifts for doing so.
        daikon
      • RE: Microsoft to put its Windows Phone marketing dollars where its mouth is

        @daikon

        I didn't attribute that quote to Thurrott. I understood MJ was saying the interesting thing(to her) about Thurrott's post was that MS was finally giving incentives.
        That said, all manner of consumer products carry spiffs and/or varying commission rates set by managemnet. This practice is prevelent in a broad swath of industries, e.g. the beer and wine distribution business.
        Ever wonder why you get pushed so hard to buy the add-ons at so many retail outlets? It isn't always the margin for the store. It is often the 'margin' for the salesman.
        The independent phone shops (non-carrier stores) are often organized around purely a spiff system. A search of the web will show you many a whine about how the OEMs and carriers are abusing the independents by narrowing the spiffs to the point they can't make money.
        An example of how prevent a practice spiffs are; there are "incentive" management firms that specialize in 'managing' spiffs for companies who wish to use spiffs to incentivize their sales partners.
        whatagenda
  • Microsoft is being run by antediluvian scum

    "I am stymied as to why it took Microsoft this long to figure out that these kinds of promos and paybacks are what???s required in the phone business."

    The explanation is simple. Ballmer is a MORON. Microsoft should have fired him ages ago. His vision since he's taken over has been, "release the next versions of windows, sql, and office, and repeat." A lump of feces could do a better job.
    jackbond
    • RE: Microsoft to put its Windows Phone marketing dollars where its mouth is

      @jackbond
      +10
      The Danger is Microsoft
      • RE: Microsoft to put its Windows Phone marketing dollars where its mouth is

        @The Danger and @jackbond you guys are clearly about 4 years behind what has been happening over in Redmond. Why not go hang out somewhere your outdated and tired old copy arguments can be believed by clueless masses.
        JimmyFal
    • And how's that multi-billion dollar company you're CEO of doing?

      @jackbond
      just curious, that's all.
      William Farrel