Surface Pre-Announcement Was A Mistake

I believe that Microsoft’s announcement of the Surface months in advance of availability was a mistake. Worse, we don’t know exactly when it will go on sale. All Microsoft has said is that it will be available “3 months after Windows 8 is released”. That could put the Surface being in stores sometime in December, or about 6 months from now. A lot can happen in 6 months. The timing probably won’t be fatal, but it doesn’t help their cause any. And it demonstrates that Microsoft is out of touch with marketing in today’s technology world.

Lost In The Noise

One thing that has become evident is that you only get one chance to get people excited about your product. Consumers are no longer willing to wait months between announcement and release to get The Latest Thing. There is simply to much happening to maintain that level of excitement. New hardware, new software, new services are all being announced and released at a fairly torrid pace. Past announcements are basically forgotten the moment Something New comes along, sometimes within a day or two.

The result is that products that are announced too far in advance are basically forgotten. It is simply too difficult to hold the media’s attention or the attention of consumers. “Product XYZ still expected to be exciting” simply isn’t going to attract readers and pageviews. If you can’t buy it today (or really, really soon), it isn’t relevant to the market, and it certainly doesn’t slow sales down for competing product. Pre-announcing future product may have been an effective way to slow down competitors 20 or 30 years ago. But that tactic simply doesn’t work anymore. The sad part is, recent lessons abound that Microsoft could have learned from.

Squandering A Brand

The first lesson is found with Nokia. Nokia announced that they were going to build Windows Phone devices in February 2011, with new product due out “later that year”. This was about 4 months after Windows Phone started shipping on other devices. The first Nokia phones, the Lumia 710 and 800, arrived in November 2011. For nearly 10 months, Nokia disappeared from the market. Symbian sales plummeted, since few wanted to invest money in a phone with no future. While Nokia was absent from the market, sales of Android and iPhone devices skyrocketed. Both Android and iOS were updated, and the hardware features on both device families improved. The iPhone 4S was released to outstanding success, and started a gain in overall marketshare for Apple. Apple gained a majority share of the enterprise market, and both Android and iOS rose to dominance in the smartphone space. The smartphone went from 20% of all mobile sales to about 30% globally, and for the first time, smartphones represented the majority (just barely) of mobile phones in the United States.

When the first Lumia devices finally arrived, they basically fell flat. They sold no more in the first month or so than Apple sells in a single week (or even a single day at times). It didn’t help Windows Phone gain any marketshare. The addition of the Lumia 610 and 900 the following April didn’t make any difference. In the 10 months Nokia was absent, they went from being the biggest manufacturer of all mobile phones to number 2 and falling. They had already slipped from the number 1 smartphone brand to number 3 or 4 (depending on the region), and disappeared from the charts by the end of 2011. What brand strength they had in feature phones, and their early dominance in smartphones, has eroded considerably. The Nokia name is still recognized, but not as a leader in mobile technology.

RIM and The Playbook Disaster

The Blackberry Playbook was an abject lesson in how to not announce a product, but one that Microsoft may be following. The Playbook was announced in September 2010 to a lot of fanfare. It was cheaper, faster, better, etc than the iPad. Of course, all we had to go on were pre-production prototypes, but on paper, it would seem to have potential. But it had shortcomings, and more became evident as time elapsed between the announcement in September 2010 and the actual release in April 2011. The lack of a local e-mail client was the first obvious flaw. The supposed “Android support” never materialized before the machine was released. Even carefully choreographed “benchmarks” didn’t make the device look all that good, and smacked more of desperation than confidence.

When the device finally arrived, it landed with a thud. Supporters tried to put a positive spin on poor results. The lack of lineups at stores on the day it was released was “a good thing”. It was seen as a “favour to Blackberry customers” that people didn’t have to wait in line. And then there were the outright fabrications: the iPad 2 “couldn’t be pre-ordered on-line” (patently false). The Playbook was available in more stores (not true). In short, by the time the Playbook arrived, customers didn’t care. The attempts to make it exciting all over again fell on deaf ears because too much had happened between announcement and shipment.

Ultimately, the Playbook sold about 50,000 units in the first day, 100,000 in the first 3 days, and around 200,000 by the end of the first week, but then volume dropped off (for comparison, the iPad 2 sold about 500,000 units in the first 3 days, including pre-orders). In the first 6 months of sales, RIM had barely managed to move 1 million machines. Again, supporters tried to make a big deal of this, but it didn’t matter. The fact is that by the end of 2011, Apple was selling more iPads in any given week than RIM had sold Playbooks in half a year. There was no way to spin it: the Playbook was a disaster, and the pre-announcement didn’t do anything to change that. Announcing the product earlier didn’t slow iPad sales in the 6 months that people had to wait until the Playbook shipped. It didn’t maintain any buzz in the media, and attempts to keep it on people’s minds simply fell short. You couldn’t buy it, and staged comparisons weren’t going to capture anyone’s attention. RIM simply didn’t have the marketing skills or marketing muscle to create and maintain any momentum around the device. People weren’t saying “I won’t buy an iPad/Galaxy/etc because Playbook is coming”. They bought what they wanted, and shrugged their shoulders when the thing finally arrived.

Could This Happen To The Surface?

There is danger for the Surface because of the long, and indeterminate, period between announcement and sale. The expectation appears to be that the Surface will arrive in December, assuming an October launch for Windows 8. In the mean time, iOS 6 will have come out, offering a host of smaller features and improvements to iOS. Android tablet makers could use the lull to their advantage (“sure the Surface looks promising, but you can buy this tablet today”).

One possible challenge could be the rumoured smaller iPad. A new iPhone is expected in September or October, and rumours continue to swirl about a smaller form-factor iPad, possibly a 7″ model that falls between the iPhone and the current iPad. Now, this has to be taken with a substantial grain of salt. Samsung only saw a surge in tablet sales (such as they were) when their 10″ model was released. Steve Jobs publicly disliked the idea of a 7″ model. But Steve’s comments also require their own crystalline condiments: he dismissed the idea of an Apple phone or a TV set-top box, months before announcing the iPhone and AppleTV.

So a new, smaller iPad could change the landscape of tablets. That may or may not help the Surface. But the Surface faces another challenge, one that isn’t immediately visible with a June announcement: the Surface won’t be competing against the current iPad. Its competition will be the new iPad that will invariably be announced in early 2013. The Surface could be a brand-new device that is already a step behind whatever Apple releases. Microsoft, by showing its cards early, has given Apple a chance to respond to the Surface with the new iPad.

The Surface will also be shipping right around the time that iPad rumours start to heat up. Trying to build media buzz and consumer excitement will be a challenge in an environment where Apple rumours form the basis for an entire industry. Whether Apple has a hand in that media noise isn’t relevant: it has an impact no matter what happens. Media buzz in advance of the iPhone 4S slowed the sale of iPhone 4 devices. Rumours ahead of the New iPad had an impact on iPad 2 sales. All of it will have an impact on competing products.

But Apple Preannounces Too!

Yes, Apple has pre-announced product months in advance of release. But that was software product. Lion was announced in December 2010, had an updated announcement at WWDC 2011 in June, and went live in July that same year. Every version of iOS is announced several months in advance. These generally coincide with developer pre-releases, so pre-announcing them isn’t a big deal. They are “announced” by virtue of the betas that are made available to the developer community. Apple might as well talk about them publicly, because they are out there for others to see.

But Apple rarely announces hardware that isn’t immediately available, or at worst, available within 2-3 weeks. Take the most recent iPad announcement: it was announced March 7th, and shipped March 16th, 9 days after the announcement. The iPhone 4S was announced October 4th, 2010, and available October 14th, 10 days later. The most recent MacBooks were announced and available the same day. But announced a week or two before shipment isn’t the same as announcing 6 months before the thing will be on store shelves.

If You Want To Steal Apple’s Thunder, Follow Their Script

The Surface would have helped its chances being a hit had it shipped the day it was announced, or at worst would ship within a couple of weeks. A compromise would have been to announce it the day Windows 8 went live, but with only a 1-2 month delay. It isn’t ideal, but it would be an improvement. Showing us a product we can’t have (almost) immediately may have been sound strategy in 1992. It isn’t sound strategy in 2012.

And that is what bothers me about the timing of the announcement. It is a 1980’s and 1990’s tactic that doesn’t work anymore. Yes, there was a time where Microsoft could effectively shut down a competing product by pre-announcing their own technology. They hampered an updated Lotus 1-2-3 when they pre-announced Excel in mid-1984. Updates to Word and Excel would be demonstrated and announced months in advance, and this tactic would forestall or slow sales for WordPerfect and 1-2-3. When Microsoft was in control of personal computing technology, their actions were watched by many, and what Microsoft touched, they pretty much could control.

Those days are over, and Microsoft doesn’t get to set the rules to the game anymore. Now, they have to play catchup. Using a decades-old marketing approach shows just how out of touch Microsoft is in today’s technology marketplace. Microsoft’s key competitors aren’t bothering with the old “slow down the competition by pre-announcing product”. They basically announce and ship. As a result, consumers aren’t necessarily prepared to wait anymore. They don’t hold off purchases for months waiting for the “next big thing”. At best, they may hold back a couple of weeks (like they did before the most recent iPhone and iPad announcements). But they won’t wait half a year for your product, even if you are Microsoft.

Will This Hurt The Surface?

Does this mean that the Surface is doomed to failure? Not necessarily. As I’ve mentioned in other blog posts, the Surface may actually gain a foothold in the enterprise market first. Enterprise customers aren’t going to hold back because of pre-announcements, but many will have Surface on their list of “things to look at later”. The idea of a tablet that integrates with their infrastructure in the same manner as their other end-user technology may have some attraction to them. That will influence which apps are initially successful, and if I were going to bet, I would be looking at office productivity and information-related software as being the big movers to start. Games and other entertainment will follow shortly afterward, but you won’t convince your boss or IT director to buy you a Surface because it has cool games and lots of movies to watch. They could be swayed by its similarity to technology they already have on the desktop.

Even then, there is no guarantees either way. The Surface is definitely a “wait and see”, and I don’t see anything to say it will either fail spectacularly or become an instant hit. It could go either way. But Microsoft isn’t helping their cause by resorting to old-school marketing tactics that no longer work. If any part of Microsoft needs a serious, big-time makeover, it is their marketing group, because this announcement is a clear demonstration of how out of touch they are with how things work today. And that is too bad, because initially, the Surface looks like it might have promise. A good device deserves good marketing, and this far-too-early announcement isn’t doing any favours for what could be an otherwise successful product.

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