Bloomberg Businessweek
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With Windows 8, Microsoft will add Metro to PCs and tablets, establishing a common appearance and experience across every device running Microsoft’s software. That’s a huge cultural shift for Microsoft. In the past, the Windows team set the agenda. This time the Windows clan will borrow from work pioneered by the mobile group. “The Windows team has always been very insular and could have opted to do something different,” says Charlie Kindel, who left Microsoft in August after 21 years as an executive at the company. “I see this as a positive sign that Microsoft can have more of that connective tissue.”
Along with the unified interface, Microsoft’s products now share all sorts of bits and pieces. Through its voice recognition technology, you can bark out “David Bowie” to your Xbox, and the Bing search engine will go hunting for songs, television shows, and movies related to the rock star. One more bark— “Play”—and the tunes begin cranking out of your home theater. Want to change the song? Yell out again or flick your finger across an Xbox remote control app on your Windows Phone. And, through the Kinect technology, Microsoft expects to lead the way in software that recognizes hand waves and the like on PCs, phones, and even in cars.
At present, Microsoft has 14 retail stores and plans to open up to 75 more over the next three years, usually placing them as close as possible to Apple outlets. “Well, the traffic is going to be there, and we’ve got to beat them anyway,” Ballmer says with a shrug. Meanwhile, Microsoft has been giving the Best Buys, Wal-Marts, and other third parties an education in the New Microsoft at a 20,000-square-foot facility a few miles from its Redmond headquarters called the Retail Experience Center, or REC.
In the front part of the REC, Microsoft has created a mock living room and home office outfitted with various gadgets. On one wall, a handful of screens display versions of an e-commerce site for Contoso, a fictional store chain created by Microsoft. In this idealized world, Microsoft shows its retail partners how it envisions people using its technology and uses the Contoso website to demonstrate how its products can be displayed well online.
Just past the fake living room is something more impressive: a full-scale fake store that looks a lot like a Best Buy. Visitors walk by a “parking lot” that’s been painted onto the wall, go up the wheelchair accessible ramp and through the automatic doors. There they find one section of the store dedicated to Xbox games, another to Windows phones, a third to Microsoft’s mice and keyboards, and yet more themed around Office and Windows. It’s an all-Microsoft extravaganza that must resemble some of Ballmer’s fondest dreams.
Every year, Microsoft conducts about 400 tours of this facility for chain store executives. The company creates demonstration disks the retailers should put in PCs, advises what categories—professional, entertainment, work—they should be arranged in, and presents discreet antitheft devices that tuck behind the computers so as not to obstruct the consumer’s view.
The REC also shows off Microsoft’s smorgasbord of marketing props. It has displays that range from a high-end, disco-themed dance stage to flaunt its Kinect games to a giant-size Windows phone that can go on a wall. The retailers can flip through a catalog of customizable window displays, in-store displays, and signage. Stores can also order up Microsoft salespeople—a group of specially trained folks who will dress up like Best Buy or Wal-Mart employees and teach the retailer’s actual employees how to hawk Microsoft products.
“In the past, we definitely took a very hands-off approach in terms of saying, ‘Look, we built the operating system, but Sony makes the PC, and you sell the PC,’ ” says Chris Capossela, a former aide to Gates and the newly appointed chief marketing officer at Microsoft. “We were, frankly, far more indirect with our approach to the consumer.”
