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by William Van Winkle |
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NO MAN MAY BE AN ISLAND, BUT for system builders, the feeling of isolation can be oppressive. If retail sales are an important part of your business, you may have a weekly advertisement in the Sunday paper. Perhaps you buy occasional radio spots. But how many system builders do you see on TV? Or Ads by Google? Or covered in the New York Times or Wall Street Journal? I can't think of one—ever. No, what you see is tier-one OEMs. You see Best Buy and Circuit City. If not for the fact that you're still in business with an active accounts receivable ledger, you might just think the world had abandoned you and decided that a faceless, generic, mass produced computing experience was all anyone needed or wanted. The big get bigger and the little get ignored. This is why I stopped in confusion one day while twiddling around the Web. I'd spotted a little icon with the words "Find a Local PC Builder". Eh? Somebody on the Web knows what a system builder is? I followed the link to localpcbuilder.windowsmarketplace.com and sure enough there was a big blurb in the middle of the page: "Buy a PC with Microsoft Windows XP from a local PC builder and get a BONUS PACK worth up to $780!" At the top of the page was a pull-down menu of states. I picked my own and—behold! Every local PC builder I could think of in my greater metro area was on the list, complete with contact info and Web site links. (If you happen not to be on this list and want to get on it, send an email to PLTQ@microsoft.com.) I was blown away and had to learn more. "The Buy Local campaign came about because we questioned how we could help, promote and build the local system builder community and ecosystem," said John Ball, general manager for U.S. system builder business, when we managed to hook up and discuss it. "We looked at some of the key challenges they face, and it broke down to three broad topics: How do we help them market? Then the Genuine element. And the last piece is about helping system builders to compete in a very price-sensitive market." According to Ball, Microsoft is working particularly hard to help resellers cater to small businesses, which is the sweet spot that best blends the system builders' high-touch capabilities with Microsoft's own sales priorities. The problem is that most system builders, while very strong on eye-to-eye sales and customer support, are not so savvy when it comes to marketing. The Buy Local program, as we'll shortly see, offers some stellar marketing draws. The Genuine software push, as I've covered here in past columns, is one of Microsoft's key tools in combating piracy. Microsoft is not so naive as to think that resellers everywhere will shun counterfeit copies simply because its illegal. There needs to be incentive for both the reseller and the buyer. The only way that the end-user can claim his Buy Local benefits is to go through the Windows Genuine Advantage validation process. Windows copies purchased through major OEMs or retailers usually do not qualify for Buy Local benefits. As for competing in a cost-sensitive market, you have to be smart. Of course, counterfeit software will always be cheaper. But you haven't survived this long by being the cheapest. The customers you want and who will keep coming back to you are willing to pay for value. The Buy Local program is all about value, which brings us to... Benefits! I'm so used to tech companies giving out T-shirts that when I saw the Buy Local benefits, I had a hard time believing it. Naturally, I can't overlook the benefits from the Genuine program, even though they pale a bit in comparison. Through Genuine, end-users get Microsoft's version of Concentration, called Match-Up!, plus everyday freebies such as Windows Media Player 10, Windows AntiSpyware, the Karaoke plug-in for MCE, and Photo Story 3. Customers also get discounts on Outlook Live, Microsoft List Builder, MSN Games, SharePoint Service, and a six-month trial of Office OneNote 2003. And way, way down at the bottom of the list is now mention of the Buy Local BONUS PACK. This is a campaign aimed at promoting Windows XP, and as such, there are different benefit bundles for each of the three XP versions: Home, MCE, and Professional. The Home benefits package includes three items. The first is $75 worth of materials from Nolo, a prominent legal company that specializes in providing plain-spoken legal facts and tools to consumers and small businesses. Specifically, the benefit includes Nolo's Encyclopedia of Everyday Law and a collection of commonly needed legal forms, such as a Child Care Agreement, Property Inventory, and so on. While the promotional fluff may not interest you, consider that Nolo's Quick & Legal Will Book costs $14.44 and my lawyer wants $400 to draft the same document, so turning customers onto Nolo may be no small favor. Next is a one-year subscription to ContentProtect, an Internet filtering program (think NetNanny) worth $40. And the big bennie is the roundtrip airfare for two contingent upon also booking a minimum lodging stay at any of the major destination hotels or condominiums listed in over 25 cities. (Urban hotels seem to average a seven-day requirement, exotic destinations eight to 14 days.) Speaking as someone who enjoyed international travel before entering the blessed yet far more localized world of parenthood, I can say that the lodging prices are pretty reasonable all things considered, and I'd say this is a pretty attractive offering. Still, you can get the same deal by just surfing to www.flyfreeamerica.com and not giving Windows a second thought. Remember, the Buy Local campaign is a marketing tool, not a money deal. The Home Edition package is listed with an "average value of $615 and up." The next step is the Media Center Edition BONUS PACK, which adds an enticing $75 deal from CinemaNow, one of the leading (legal) movie download services. This is a great MCE tie-in, although there is no hard and fast link between CinemaNow and the functionality specifically in MCE. The service works just as well in XP Home or Linux for that matter, not that I'm aware of any Linux vendors handing out this promotion. The CinemaNow bundle gives the user coupons every month for three months redeemable for one high-def movie, two free-to-own music videos, and three pay-per-view movie rentals. Obviously, the promo is meant to hook people on the service, but since I think vehicles such as CinemaNow are the path of future multimedia consumption, I see good value in turning users on to this service before the rest of the masses. A positive experience can only reflect well on your business for helping them to enjoy that content. Finally, the XP Professional BONUS PACK, listed at "$780 and up," makes further changes. The Fly Free America item remains the same, but the Nolo items now include the Encyclopedia plus two business contracts (independent contractor and for manufacture of goods) and a guide for doing business out of state. The new Nolo set is valued at $100. Similarly, the Internet filter has been upgraded to the $80 per year ContentProtect Professional, which includes features such as remote management and reporting. And last of all is a $100 value annual license for Pure Networks's Network Magic. The license is good for 10 clients in a site. Network Magic doesn't do anything that a skilled network tech can't accomplish, but the point is that it performs all of the rights sharing, network connections, port management, security key administration, and so on through a very simple interface. In short, it's a management-level time saver that in the right hands might pay for itself several times over, especially since in this case it's free. And that's Buy Local. If you get obsessive about the $615, $690, and $780 figures, it's easy to lose sight of what this is all about. No, you're not really going to give your customer the equivalent of a new PC in dollars just for buying Windows XP through you. By the same token, don't let him glance down the list of benefits and just blow it off as worthless fluff. There's some good stuff in there, and it's worth taking three minutes to walk through it if he seems at all interested. Taking a step back, I also think it's significant that Microsoft is taking such a heavy interest in bringing new help to system builders and bridging that isolation of being an island. "Buy Local is just one of the initiatives we're taking out," said Microsoft's Ball. "We're also investing a whole series of resources we've not had before: an outbound sales force. I now have a range of resources across the U.S. actually calling on local system builders for the first time in probably six years, knocking on doors and telling people about us, the Buy Local campaign, and a whole range of offerings geared for this part of the marketplace." Another intriguing initiative from Microsoft is the OEM Hardware Solutions Competency. As we've covered Microsoft's reseller program competencies before, there's no need to belabor the point here. (Hit www.microsoft.com/oem if you need more info.) The new competency, which debuted just last month, is aimed squarely at system builders and offers some notable benefits. You get a certified partner box and competency box with Technet subscriptions. There's Level 200 to 300 training with a slew of accompanying documentation and learning products. You get a 5-pack for post-sales tech support, a Microsoft account manager, co-op opportunities (if you meet volume requirements), and priority listing in the Microsoft Resource Directory. Worth noting is that resellers working at the competency's top levels will end up getting a system WHQL certified. This is the benchmark required in so many government and non-profit bids, and having a system WHQLed puts you on even footing with the tier-one vendors and may prove to open a lot of doors. By the time we were ready to wrap up our discussion, I paused and asked John Ball why Microsoft had seen fit to reach out to system builders so much of late when the bulk of its business still came from the tier-ones and mass merchants. "Success for Microsoft is not about just having two or three players at the top taking all the business," he answered. "Truly, we believe that it's about having a balanced ecosystem. System builders really do represent some great value to end customers. They offer high service, high intimacy, and in their transactions they offer local capabilities that are hard to replicate on a global scale. Because of that, we see the value of and are investing heavily in this marketplace." Recognition is always a good thing, but being taken out of obscurity and allowed to share some of the marketing limelight beside much larger competitors is something orders of magnitude better. |
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