Microsoft's holiday goal: Sell 16 million Windows tablets

Microsoft's holiday goal: Sell 16 million Windows tablets

Summary: According to a new report, Microsoft is aiming to sell 16 million Windows tablets this holiday season. Maybe its alleged $405 million retail Windows marketing budget for FY'14 will help.

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One of Microsoft's biggest retail goals for holiday 2014 is to sell 16 million Windows tablets, according to alleged Microsoft strategy documents obtained by Paul Thurrott, editor of the Windows SuperSite.

msholidayretail

To achieve this goal, the Softies are going to be increasing retail spending, according to Thurrott's report. Last fiscal year (ending June 30, 2013), Microsoft spent $241 million on its retail Windows efforts. This year, that amount will jump to $405 million, according to Thurrott's information. Of that $405 million, $131 million will be spent on incentives and offers, with the remaining $274 million going toward direct marketing and operating expenses.

Microsoft also is going to try to move the public perception meter about Windows devices. The idea is to make the Windows experience a "loved part of people's lives," not just something functional and utilitarian. Yes, this is all part of Microsoft's push to increase its appeal to consumers, since they've already got many business users sewn up.

I'm assuming Windows tablets here means not only Surfaces but also Windows tablets from other vendors. I'm not sure what Microsoft's desired mix might look like here.

Microsoft has not released publicly the number of Surface sales it has made to date. Surface revenues (which are reported into Windows client) for Microsoft's most recent quarter were $400 million. Microsoft officials said they sold double the number of Surfaces this quarter that they did in the previous calendar quarter. (Note: We don't know what either of those numbers are.) Surface RT sales were better than anticipated, officials said, while some potential Surface Pro customers held off, waiting for the Surface Pro 2.

So is 16 million a lot of tablets? A very modest goal? Again, I'm not entirely sure. Gartner recently estimated that 184 million tablets will be sold worldwide by all vendors in calendar 2013.

One way Microsoft can sell more Windows tablets is to hurry up and get those promised Microsoft stores inside Best Buy up and running. I stopped by a couple of New York City's biggest Best Buy retail stores this week. The situation is not pretty. There's still nowhere for those interested in Windows PCs and tablets and the new Surfaces to go to do side-by-side comparisons.

The only Microsoft brick-and-mortar store in Manhattan remains a very small kiosk in the Time Warner Center mall. Here's hoping for some new/more Microsoft holiday pop-ups and/or specialty stores in the not-too-distant future.

Topics: Mobility, Tablets, Windows, Microsoft Surface, Windows 8

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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46 comments
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  • Stretch goal

    I wish them the best of luck. I wonder if they count hybrids like Yoga (and I don't mean the Android Yoga - bad naming choice). I have Surface RT and may upgrade, but I may wait until 2014 hoping for some downward pricing pressure.

    In order for this to happen, we need some heavyweight app announcements. Where is Minecraft for Windows RT? A bunch of Windows Phone 8 apps are coming, like Instagram. The tablet part of Windows 8, which I wish Microsoft had named so I'd know what to call it, needs a similar slew of key apps to show up.
    FDanconia
    • I can't wait to see Microsoft's new marketing

      Don't worry about the lack of apps. In fact, don't worry about the device.

      It's the marketing that will entertain us.

      Ever since Bill Gates wiggled his backside at Seinfeld in a Windows TV advertisement, I've looked forward to them all. Didn't you love Microsoft's marketing department's idea to stage a mock iPhone funeral in Redmond? Heheee. What about those fake Apple boardroom skits. Ha! And I almost forgot... the Kin phones falling into a urinal. That was brilliant advertising.

      This is why I can't wait to see what Microsoft comes out with yet. I will sit back and eat my popcorn and enjoy.
      Vbitrate
      • The new Microsoft is awesome.

        This is not the Microsoft you or I used to know everything has gotten a major make over under the Modern UI banner which by the way is very beautiful especially WP gorgeous interface, the company itself and even its commercials have gotten makeovers, MS will reign again in the long run much like what Xbox did in the past or so I suspect.

        MS new commercials

        Surface commercials etc.

        http://www.youtube.com/watch?v=2OqzxB-cSW8&feature=player_profilepage

        http://www.youtube.com/watch?v=pjlvH74vsWA

        http://www.youtube.com/watch?v=FAziC85DJZk

        http://www.youtube.com/watch?v=HSuqxDwPPEw


        WP8

        http://www.youtube.com/watch?v=0ajwuiCvEK0

        http://www.youtube.com/watch?v=2vR4LeL0yzE

        http://www.youtube.com/watch?v=5nRj9pv0y9M&list=PLgKNvl454BxfYo10Ef3AloKOf7rPC8G1K

        http://www.youtube.com/watch?v=did4clABUKA
        bxbbrian
        • I can tell that LoveRock no longer heads up marketing

          The new commercials are much slicker than the last round.

          I must admit that these new commercials are good enough that even I might consider buying....

          A glow in the dark Vespa :)
          InformationRetrieval
    • Minecraft ?

      Don't get me wrong, I like anbd own a Lumia 920 but, of all applications/games out there do you want a Minecraft port ?

      The game by now is pretty old (yes it's still being updated) but for me it lost it's hold over me years ago... (and I played/modded the heck out of it back then)... also, doesn't your PC run Minecraft ? And finally, there are a lot better programs and applications out there I'd like a WPhone port of than Minecraft...
      DJK2
  • 1 to 2 million sold in past quarter?

    Mary Jo,
    if MS made $400 M and assuming that the average price is probably around $400 (if you average RT and Pro) wouldn't that mean that what they sold is roughly 1 million of them? Maximum 2 million.
    Do they seriously think they can get a 1,600% increase in sales?
    gcesare
    • Windows tablets would include Dell, Lenovo ...

      HP, Asus, Acer etc. Windows tablets not just Surface tablets. A lot of their previous advertising featured a vendors tablet so I'd expect more of that along with more Surface ads.
      greywolf7
      • Those vendors

        are selling even fewer devices than Microsoft. And considering how much money they are spending, they need all those sales to be Surface devices, otherwise they are going to lose their shirts.
        baggins_z
  • MS Retail doing well in Florida

    I've visited 3 Best Buy's in recent weeks (2 in Orlando area; 1 near my home in Port ST Lucie) -- all had the embedded MS stores. They are quite nice with wooden floors, and hold up well v the embedded Apple and Samsung stores.

    There are four full retail stores in the state (2 in the Orlando area) and four kiosk stores. The 2 Orlando stores are nicely positioned: one right next store to the Apple store; and the other on a second level directly above the Apple store on the lower level (like the symbolism of that latter location :grin)

    Manhattan (where I lived for 25 years) is very space constrained (and pricey) for the kind of wide-open retail one sees down here in FL. I'm not surprised at the poor MS retail presence there. I wonder what it's like in the greater metro suburbs: NJ, Westchester, Nassau/Suffolk, etc -- just checked MS store locator -- not so great for the burbs either.
    eboyhan
    • They're pretty... and empty.

      In fairness, the embedded Samsung stores are usually even more of a barren wasteland.

      My casual observation has been that there are no more (or fewer) customers in the PC browsing area with the Ms popup stores than there were to begin with. Best Buy can't be thrilled with that, either. It's a HUGE swath of real estate and it has pushed the high value items, like Kindle Fires and other tablets off in odd and hard to find corners or in the general mobile area.
      Playdrv4me
      • I doubt it bothers Best Buy...

        As I understand it , the space is leased to Microsoft - thus they would get paid even without customers.
        jessepollard
  • I will be buying several tablets

    as gifts this holiday season. None of them will be Windows tablets. The lower priced Android tablets make great gifts without breaking the bank. They work great out of the box for people of every age. I recently looked at a Surface with the 14 yr old. He liked the commercials, but after trying one at the store, he quickly lost interest. He almost has enough money saved to buy a Galaxy Note and is counting down the days until he can buy one. Windows has tried to position the hybrids as the perfect combination of laptop and tablet but they fall short in both categories.
    krossbow
    • same here...

      But all tablets will be absolutely Windows 8, either 8 inch or the full 10 inch ones. Just waiting for new 8 inch models to arrive.

      After using Surface RT, yes RT I find it just way superior to iPad or Android in every sense. Its Phone OS versus Desktop level OS, with both touch and productive desktop with office.
      soulxfer@...
    • You know the point if a gift

      is to get the person what THEY want, not what you want.
      baggins_z
      • Re: You know the point if a gift

        "is to get the person what THEY want, not what you want."

        So, you are giving Android tablets too?
        InformationRetrieval
    • just bought an iPad Air...

      Good luck trying to move 16 million Touch tablets, they'll need it big time. The new iPad Air is one tough product to beat. At half the weight, availability of apps, stunning display, and incredibly easy intuitive interface, Microsoft has one heck of a hard sell. They'll be incredibly lucky to move a quarter of that estimate. Let's face it, it's a failed product. It will go the same way as the Zune.
      gtdworak
      • Your facts are not correct...

        If you are comparing the iPad Air to the Surface RT 2 (the most fair comparison), the iPad is about 1 pound and the RT is a shade under 1.5 pounds, but has a larger display. Hardly "half the weight". If you are comparing it to the Surface Pro 2, then it is indeed half the weight, but has the comparison is unfair to the Air, as the Surface Pro is really a full-blown laptop replacement.
        batpox
  • Microsoft Retail...

    ...experience here in northeast Ohio is pretty decent. Both of my local Best Buy's have Windows Store sections with decent selections of devices. Meanwhile, just a 40-minute drive away is our Beachwood Microsoft Store, which I like way more. I've been up there 4 times, and each time I've walked away highly impressed with the staff and the crowd of people in the store. I'm stunned that Microsoft hasn't done a better job to get one in New York.
    GoodThings2Life
  • Sounds ambitious beyond hope

    M$ has already formed a bad association in the public's mind, with their tablets. W8 OS was (is) a disaster, RT a disaster, dancing commercials a disaster. The wind is definitely not at M$'s back. M$ is not even starting fresh out of the gate with this optimistic projection, but trying to overcome the complete failure that was the Surface. I don't think they should allow any sales goals to leak, when the goals aren't met, M$ looks more the failure.
    FrankInKy
  • How to meet the goal

    Come out with Windows 9, that is a virtual clone of Windows 7, but with an option to boot up in Metro tile crap if you want to.
    D.J. 43