Microsoft's Strategy for Small Businesses (A): The Innovative PR Campaign for MS Office Accounting 2007

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Case Details:

Case Code : MKTG167
Case Length : 20 Pages
Period : 2005-2007
Pub Date : 2007
Teaching Note :Not Available
Organization : Microsoft Corporation
Industry : Computers and Information Technology
Countries : Europe, USA

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An Innovative Campaign Targeting Small Businesses Contd...

The launch of OAE 2007 and OAP 2007, and the aggressive marketing campaign to support the launch of these products, were part of Microsoft's renewed effort to gain a bigger share of the small business accounting software market that was dominated by QuickBooks, an accounting software product from Intuit Inc8 (Intuit). The competition in the accounting software market had intensified when Microsoft launched its SBA 2006 in September 2005. Subsequently in October 2006, Intuit, in a strategic partnership with Google Inc.9 (Google), launched QuickBooks 2007, which enabled small businesses to use the Internet-based services of Google to grow their business.

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Microsoft's OAE 2007 and OAP 2007 also had tools and features that provided various Internet-based services to small and medium businesses (SMBs). These integrated online services would allow SMBs to use the Internet to sell their products, make and receive online payments, process reports, etc., while running the accounting application. Microsoft had designed these software to provide strong competition to Google/Intuit in the market place. OAE 2007 was available as a free download and was targeted at small businesses that still used pen and paper, calculators, and spreadsheets for their accounting needs.

The premier version OAP 2007 had features that addressed more complex requirements. The idea was to provide the entry-level software free in the hope that the users would upgrade to the premier version in the future. Analysts opined that the launch of OAE 2007 and OAP 2007 coupled with its aggressive marketing campaign showed that Microsoft was keen to become a dominant player in the small business software market. Microsoft saw this market as a major growth opportunity as it had remained untapped by various technology vendors. "We are absolutely making a strategic push to small business. We are looking for new and innovative ways to reach the target audiences,"10 said Michael Schultz, US business and marketing lead for Microsoft Office Live11 (Office Live)...

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8] Intuit Inc., headquartered in Mountain View, California, USA, is a software company that develops financial and tax preparation software and provides related services for small businesses, accountants and individuals.

9] Google Inc., headquartered in Mountain View, California, USA, is an Internet firm that specializes in Internet search and online advertising.

10] Matthew G Nelson, "Microsoft Tries New Ways to Reach Small Business,", December 19, 2006.

11] Microsoft Office Live is an Internet-based software service targeted at small businesses with less than 10 employees. Microsoft Office Live provided its customers with their own free domain name, website, and e-mail accounts. Through Office Live, Microsoft also offered, for a fee, important business software applications, such as customer management, project management, and document management tools, and website management services. (Source:


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