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March 31, 2006

IBM vs. Microsoft in big bucks business marketing battle

Posted by David Hunter at 8:33 AM ET.

IBM is apparently feeling the “heat” of Microsoft’s dubious $500 million “People-Ready” marketing campaign targeting business customers ([1], [2]) and has decided to fritter away some money too. Yesterday, they announced a bounty for Microsoft Exchange customers, but today comes word that they are really putting some serious cash on the table. Rebecca Barr and Dina Bass at Bloomberg News:

IBM Corp., the world’s largest provider of computer services, will spend more than $300 million on an advertising campaign to win customers and help revive its image with investors.

Chief Executive Officer Sam Palmisano is spending half his $632 million annual ad budget on print and TV spots that feature an asterisk and the question, “What Makes You Special?”

Snort.

The ads, championed by strategy chief Bruce Harreld, set up a showdown between IBM and Microsoft Corp. as the companies seek to bolster sales and stock prices. International Business Machines is the No. 2 software maker behind Microsoft, which this month announced a $500 million effort to win corporate customers by exploiting questions about IBM’s services strategy.

“People are confused, and that’s why we are going into that campaign,” Harreld, who also took control of marketing in January, said in an interview at IBM’s Armonk, N.Y., headquarters. “We’re really trying to get at this problem.”

The ads, debuting in April, break with IBM tradition by including a theme song, “I’m Not Like Everybody Else” by 1960s British rock group The Kinks, and by painting the logo across a Manhattan helipad.

That ought to do about as much for the IBM stock price as Microsoft’s notorious Dinosaur Head campaign did for theirs. Mr. Harreld notably guided the fortunes of Boston Chicken before finding a berth directing strategy at IBM 10 years ago. As of January he runs both strategy and marketing, an interesting combination.

No ads from either campaign have appeared yet and for all I know they will be filled with charm and insouciance leading to an immediate desire by countless corporate IT folks to open their wallets. However, selling to business customers is not the same as selling to consumers and I suspect we are mostly destined for some chuckles at IBM and Microsoft’s considerable expense.



Filed under Coopetition, General Business, IBM, Marketing, Microsoft, Public Relations

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