Apple & Google: “What is everyone else doing wrong, and how can we destroy the foundation of the market they operate in?”

The word ‘disruption’ is thrown around by a lot of companies.  They use it to describe their operations or future products because it makes them feel like they’re innovators who are doing something truly great.  So why do most of them end up homogenizing themselves with their competitors, all while keeping their market stagnant?

The difference between Microsoft and Apple, or Microsoft and Google, is that one is looking upon the landscape from 100 feet up, while the other is looking at it from 10,000 feet up.  It’s impossible to see the big picture if you’re just looking at what your main competitors are doing.  The real winners, it seems, are the ones who see where their market will be headed in 5 to 10 years, and start working towards that system now.

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Tucker Max’s response: “No. The real winners don’t worry about competitors or landscape at all–they worry about solving real problems that real people have, and thus create real value for them. I doubt in most cases Google or Apple even think about where the market will be in ten years, or at least, they think about it in a different way–they think about what problems people will have, and how they can solve them. Solving a problem creates value, and creating real value is the key to 21st century business success.”

“PC makers in the Windows camp have done everything possible to make their products progressively worse by cutting corners to save pennies per unit and boost sales volume.  There’s good reason Apple is seeing healthy profits while grabbing market share.  It refuses to budge on quality and so charges a higher price. Rather than running ads that seem clever at first but really aren’t, the Windows guys ought to take the hint and just build better computers.”

The best companies — the ones who retain their brand equity while consistently increasing their bottomline — all think relentlessly long-term.  They know that marketing means absolutely nothing if you have a bad product.  So start allocating all of your ad money into the R&D department.  You can get a lot farther on free word-of-mouth than with a multi-million dollar TV campaign.

Quality first, marketing later.

Awesome job, morons.  Yea, I’m sure the panoramic feature is really going to get people to believe in Vista.  That’s a HUGE selling point.  I can just imagine all the people who are running out to Best Buy to get a copy of your $130 software, just so they can put all their pictures together into one giant poster.  I mean, that’s the reason people buy computers!  By the way, have you had a chance to develop a stable, intuitive OS that doesn’t make people pull their hair out yet?  Oh, you’re still working on that.

I never understood why companies do these commercials with disclaimers that say “Real people. Not actors.”  It’s a TV ad!  Why would you try to deliver a genuine message on the medium that’s known for distorting reality?  Besides, you edited out everything you didn’t want people to see, so it’s inherently biased anyways.  It doesn’t matter that they’re not actors — we’re still not going to trust your commercial.

Microsoft does not have a marketing budget; they have an advertising budget.  And there’s a huge difference between the two.

Advertising is what you tell people to think about your company.  Marketing, on the other hand, is what you get people to think about your company on their own. So when you tell me your software is great in an ad on TV, that’s advertising.  When I find out that your software actually sucks after installing it and I complain on a message board about it, that’s marketing.

If you don’t have great content, you’re standing on a very weak foundation.  Scrap your advertising budget and put all your money into finding a way to get your product to market itself.

9/20 – UPDATE: Seth just wrote a pretty similar article to this one.

Aside from the insanely idiotic Seinfeld-Gates commercial, Microsoft has pulled yet another move revealing how clueless they are about marketing. “Microsoft Gurus”?  Really?

Before I tear into Microsoft, let’s talk a little bit about the experience of dealing with an Apple Genius.

The best thing about Geniuses is that they don’t come across as employees – they’re just passionate Apple users.  I don’t mind talking to them because their behavior doesn’t signal that they are being paid to talk to me.  It comes across as a very genuine interaction.  Geniuses don’t even actively try to make me buy something.  Seriously, they’re barely a step above Barnes & Noble employees when it comes to pressuring sales.

Microsoft Gurus, however, are going to be giving demos to the tune of “See how Vista doesn’t suck as much as you thought?”  Apple’s Geniuses are perceived as passionate users.  Microsoft doesn’t really have many passionate users at this point (other than Steve Ballmer), so these poor Gurus are going to come across as thinly-veiled shills who are restraining their desperation.

My point is this:

When you have a product that is great and can sell itself (Apple), it doesn’t matter that there’s someone (Genius) who is encouraging the sale.  But when you have a product that’s perceived to be awful (Vista), anyone’s claims to the contrary (Gurus) are going to be perceived as highly specious.

Vista genuinely sucked for software that spent 5 years in development, and customers spoke up. The “Get A Mac” ads didn’t tarnish Vista, and the Mojave ads won’t save it.  Advertising was never the true cause of Microsoft’s problems, nor is it the solution.

Microsoft – Put your marketing money into making a better product; one that will sell itself because people love it.

One last thing…

My favorite thing that I noticed while writing this post was that the Mojave Experiment site didn’t work for me.  Reason?  I needed to install Silverlight in order to watch the videos.

Putting up a barrier for customers to watch your ads online?  BRILLIANT!  Oh, Microsoft…

Click to see Mojave's landing page

“I found for myself that Microsoft is better organized, managed and structured. Google was like a kindergarden (sic) – young and not experienced enough people, an office full of fun and entertainment, interviews typical for junior people and lack of traditions in development of high quality software products.” -Svetlin Nakov

I have a theory that Google’s big problem is that the company hasn’t realized that it isn’t a startup anymore. This disconnect between the company’s status and it’s perception of itself manifests in a number of ways Startups don’t have a career path for their employees… Once riches are no longer guaranteed and the stock isn’t firing on all cylinders (GOOG is underperforming both the NASDAQ and DOW Jones industrial average this year) then you need to have a better career plan for your employees that goes beyond “free lunches and all the foosball you can handle”.

The technology press makes it seem like people are ditching Google for hot startups like FriendFeed and Facebook. However the truth is has a more nuances than that. Now that Google is just another big software company, lots of people are comparing it to other big software companies like Microsoft and finding it lacking.

Sometime later this year, Microsoft will launch a rebranding campaign for Windows, its core product. It’s Ballmer’s answer to “Get a Mac.” And while Yahoo may have turned down Ballmer’s $47.5 billion acquisition bid, the CEO says he’ll spend as much as it takes to build a business that challenges Google on the web.

Microsoft’s image isn’t too hot right now, but it’s not entirely irreparable.  Sure, their future is grim, but I don’t think it’s completely impossible for them to be cast in a good light someday… many, many years from now.  But if Ballmer’s at the wheel, I have my doubts.  The reason I say that is because a lot of the higher-ups in the tech industry (especially Ballmer) are wildly biased towards their own companies, and refuse to acknowledge their limitations by playing it smart (e.g. CEO of Napster).  Competing with Google at this point in time?  Is that a joke?

I saw the movie “21″ recently (meh, it’s alright).  One of the better lines from Kevin Spacey’s character goes: “The only thing worse than a loser is someone who won’t admit he played badly.”  Ballmer is wildly hubristic if he honestly thinks Microsoft can compete with Google on the web.  Like a gambler who refuses to admit he lost, Ballmer will dump money into a project that’s almost guaranteed to fail. Microsoft will never be first, or even second, in the eye of the consumer for web search, so give it up.  Put your money into something that hasn’t been dominated already.

One of the things I liked in Kawasaki’s “Art of the Start” is when he says you should always run a business idea by a woman first.  The reason for this is because guys love almost every business plan, especially when they hear you phrase your idea as “The (Some Monopoly) Killer.”  Us guys tend to get excited when we can picture ourselves taking down the #1 business in an industry, but it’s usually unrealistic thinking.  In Microsoft’s case, they have the cash, but they don’t have what’s important: innovation, corporate culture, and brand equity.  Sure, they have those things, but not like Google does.

It’s just going to be sad to watch them dump more money into their Live search, then spend even more money bribing people to use it.

Microsoft was once motivated by its own Big Hairy Audacious Goal: “a computer on every desk and in every home.” They achieved that goal, and ever since, they’ve drifted. Now their only goal seems to be to stay on top of the heap. They need to stop focusing on eating other people’s lunch and start thinking deeply about what kind of goals might stretch the company once again.

Microsoft is probably one of the best examples of this “big company” mentality. This seems to happen all the time. A company comes on the scene with a vision and a great product/service, and as soon as they become dominant in their category, they forget to realign their strategies. They milk their product for all it’s worth (which is the right thing to do), but they also try to play catch up with their competitors. This is a waste of resources, typically. It’s especially true when a company puts their name on a new product that doesn’t really fit with them. (Donald Trump is the absolute worst at this, and while he’s a smart businessman for the most part, he’s notorious for idiotic line extensions. Trump vodka? Trump steak? Come on, put your ego aside and think about what you’re doing.)

The Microsoft Zune? No one is going to take down the iPod in the portable digital music player industry unless its Apple replacing it with something better. Microsoft Live? No one is going to take down Google anytime soon, and the company that will sure as hell won’t be Microsoft. The problem with this company is that they’re trying to be everything their competitors already are. They’ll imitate any company that poses any sort of threat to them. They make no attempt to be the leader of the pack anymore. There’s no strategy because they never were the innovators; they were just the smart business people.

Microsoft is every big company who doesn’t understand the importance of vision. Microsoft’s vision was to have a computer in every home. They essentially accomplished that goal long ago. They’re desperately looking for new sources of revenue because their competitors are so much better than they are. Instead of redefining their vision, they follow others. They’re toast, and have been that way for awhile.

If you are a big company, DON’T follow what your competitors are doing. Stick to your guns. Guns = what’s your really good at and what your customers know you’re good at. Microsoft isn’t Google, Nintendo, or Apple. Stop pretending and define yourself.