Microsoft is one of the leading tech companies that can be found out there. They have a unique and a one of a kind strategy, which is helping the company to achieve great levels. This multinational company is based in United States. It is engaged with the process of developing, licensing, manufacturing and supporting computer software, personal computers and consumer electronics. A variety of similar series are available under the hood of Microsoft.
Microsoft is well known for their operating system, which is known as Windows. In fact, Microsoft Windows is one of the most popular operating systems that you can find out there. In addition to that, the other products offered by Microsoft Office Suite and Microsoft Internet Explorer are also popular among people. Gamers are provided with a dedicated gaming console, which is known as Xbox. In addition to that, professionals are provided with Microsoft Surface, which is a personal computer lineup equipped with touch screen computers.
When you take a look at the revenues, you will figure out that Microsoft is leading the list of software manufacturing companies out there in the world. On the other hand, it is one of the leading and most valuable tech companies out there. According to the Fortune 500 rankings of 2018, Microsoft is ranked in the 30th position.
History of Microsoft
The company Microsoft was initiated by Bill Gates back in the year 1975. He started this company with the objective of developing and selling BASIC interpreters, which were used for Altair 8800 computers. During the 1980s, Microsoft came into computer software development. They were able to revolutionize the computer software industry during the 1980s because of the introduction of MS Dos. That was the origin of the Microsoft Windows operating system as well. The operating system received lots of positive attention during the initial days. That’s the same reason why the company was able to increase total number of people who use this operating system up to 12,000 within few years. However, it was expensive and was limited only to millionaires.
From the 1990s, Microsoft started diversifying the products offered through the company. In the meantime, they continuously worked on the operating system as well. This helped the company to achieve many great heights. One of the biggest decisions that Microsoft took in the past was to purchase Skype back in the year 2011. This VoIP Company was bought for a price tag of $8.5 billion. Along with that, Microsoft noticed the impact that the acquisition of successful business ventures can create on the brand. This tempted the founders to go ahead and acquire many other successful brands. The acquisition of LinkedIn in the year 2016 can be considered as a perfect example to prove the above-mentioned fact.
Revenue of Microsoft
Microsoft is one of the leading revenue-generating tech companies out there in the world. Software products offered by Microsoft are the biggest factors, which have contributed towards the revenue generated by the company. In other words. Microsoft Windows and Microsoft Office bring in lots of revenue to the company.
The company went public back in the year 1986. It was one of the most important financial decisions taken in history. Along with that, the first Public Offering took place in the same year as well.
Since then, Microsoft has been increasing its revenue. However, 2011 was not a very good year for Microsoft. They ended up with losing the first quarter of 2011 with an amount of $726 million. That’s mainly due to the Windows 8 operating system. It was not a competent operating system when compared to its predecessor, Windows 7. As a result, the company ended up with a loss. However, the engineers working for Microsoft understood the situation and took necessary measures to come back strong. As of now, Microsoft is playing a major role and it is driving the overall success of Microsoft.
During the year 2018, Microsoft was able to earn a total revenue of more than 286 billion dollars. The military contract that Microsoft signed up in the year 2018 contributed a lot towards their success. This military contract was worth more than $480 million.
Marketing strategy of Microsoft
Even though Microsoft offers some of the well-established products to the market, they still focus more attention on their marketing campaigns. That’s because Microsoft has to face a tough competition from the other similar products, such as the open source operating systems. Since the marketing strategy of Microsoft remains solid, they have been able to mitigate competition in an efficient manner.
Microsoft is paying more attention towards the user-friendliness of their products during the marketing campaigns. For example, if you take a look at a Microsoft product marketing, you will notice how they promote that Microsoft products are easier to use when compared to Linux products and the other competitor products. They convince people to go ahead with Microsoft and experience all the benefits that come to them as well.
One of the most successful marketing campaigns that Microsoft launched back in history is known as Get the Facts campaign. The main reason and objective behind this marketing campaign to boost the popularity of .NET development framework. It was done along with a partnership created with London Stock Exchange and Accenture. As per a research that was conducted alongside, it was identified that the Microsoft .NET framework is 59% more reliable when compared to the competitor frameworks. As a result, people were convinced to go ahead with Microsoft.
The advertising campaigns run by Microsoft are so innovative and impressive. They are in a position to grab the attention of audiences. In fact, the Tech Publications that Microsoft has been doing in Tech Crunch have even got the attention of people who work for Google. Microsoft will be able to take things to the next level in future and we will be able to see them achieving many great results.
How Microsoft made a successful comeback?
Microsoft is the most valuable company that you can find out there in the world as of now. In other words, Microsoft now has more cloud computing revenue than Google, more subscribers than Netflix, and it is reaching a market cap of trillion dollars.
However, things were quite difficult for Microsoft 16 years ago. In fact, the company lost its crown as the most valuable company in the world. Therefore, you would be interested in learning how Microsoft could regain its crown as the most successful company. Keep on reading this article, and you will figure that out.
When you take a look at history, you will see how many tech companies have lost their position in the market capitalization charts along with time. Yahoo is a perfect example of such a company. Yahoo was once a dominant company. But as of now, Yahoo is not found anywhere in the top names. Time moves on, and technology changes. Companies that adopt accordingly can survive, and the other companies find it a difficult task to secure their position in the industry.
Microsoft lost its position as the world’s most valuable company back in 2002. Since then, it took 16 long years for the company to regain its position. It is worthy to see what the company did during those 16 years to regain the lost galore. Let’s take a look at the most important facts, which contributed towards the success of Microsoft.
Appointment of new CEO
Satya Nadella was appointed as the Chief Executive Officer of Microsoft five years ago. It was one of the surprising decisions that Microsoft has made for many observers. However, he played a major role in the company’s success during the past few years.
The previous CEO of Microsoft, Steve Ballmer, came up with a mobile phone strategy. It was not doing well. In fact, Microsoft mobile phones didn’t have the ability to compete with Samsung and Apple devices. Therefore, Microsoft could not regain any positive returns out of it.
When Satya Nadella was appointed as the CEO, one of the very first things he did was to remove the mobile phone strategy implemented by the previous CEO. He believed that such a business to consumer model would not be able to contribute towards Microsoft’s financial success in the long run. That’s where he started focusing more on business to business initiatives.
To begin with business to business initiatives, Microsoft went ahead and acquired GitHub and LinkedIn. These were two of the best acquisitions that Microsoft has ever done in history. Due to these two acquisitions, the company could triple its stock values within a few months.
Focusing more on cloud infrastructure
The decision taken by Satya Nadella to focus more on cloud infrastructure can be considered as the most prominent game-changer, which contributed towards the success of Satya Nadella. It is a perfect decision taken by the CEO promptly.
Until Microsoft tapped into the cloud infrastructure market, Amazon was holding the monopoly for it. In fact, Amazon has been controlling 33% of the overall cloud infrastructure market of the world. The strategic leadership of Satya Nadella helped Microsoft get more people to onboard into the cloud infrastructure services offered. It was done along with the Microsoft Windows operating system. Therefore, more people got to know about Microsoft’s cloud infrastructure services, and they decided to go ahead with it.
Now people accept that Windows is more of a server-side OS. This also created a major impact on the other major operating systems found out there in the world. For example, Linux is the major operating system that is being used within Microsoft Azure.
Satya Nadella proved that innovation is all that is needed to regain the lost galore. Microsoft has showcased that He was able to guide a massive company such as Microsoft to overcome the negative consequences created by the innovator’s dilemma.
According to the theory of innovator’s dilemma, the overall value of an innovative product reduces after multiple iterations. This accelerates when it doesn’t have a big customer market and when it doesn’t have peer pressure from the new innovators.
Microsoft was able to develop new and innovative products by overlooking the products, which didn’t have the ability to contribute to the brand’s success. For example, mobile phones produced by Microsoft were not popular among people at all. People didn’t want to go ahead with the Windows Operating System in mobile as well. Satya Nadella figured this out. Instead of investing money in such initiatives, he thought of investing money in better initiatives, such as Azure. It contributed a lot to the success of the company at the end of the day.
Now you have a solid understanding of how Microsoft made a comeback and regained its title as the world’s most valuable company. It was not an easy journey. However, they did what was needed to be done promptly. It delivered positive results to Microsoft at the end of the day.
However, it is also important to keep in mind that the decline of Microsoft’s two main rivals also contributed a lot towards the support that this tech company received in becoming the world’s most valuable company. For example, Apple tumbled down from the trillion-dollar market cap, and the shares were reduced by 16%. That’s mainly because the Mac, iPad, and iPhone sales have dropped due to lack of innovation. Likewise, Amazon also experienced a drop in the recent past. In the future, Microsoft will have to experience tough competition from Amazon and Apple if it comes up with a great range of innovative devices. However, we can rely on Satya Nadella, and we can believe that he will not let Microsoft fail.