Microsoft Health Care Pops a Cap in One Big Week

Wow, what got in the corporate water for this week? Coming off the glow of last week's Company Meeting Koolaid we first got hit by the Goldman Sachs downgrade hang-over, then, to channel Mr. Ballmer, "Boom-Boom-Boom!"

• Health care changes on the way.
• Live Labs gets shut down.
• Technical Fellow Gary Flake, one of Microsoft few-TED stars, resigns.
• Technical Fellow Brad Lovering leaves.
• A glassdor.com survey that shows a lowly 50% approval rating for Mr. Ballmer.
• IEB gets re-orged.
• Massive gets shuttered (like we were all looking forward to billboard ads while blowing crap up in Xbox).
• Adobe acquisition rumors.
• Matt Rosoff leaves Directions on Microsoft.

All this right on the eve of Windows Phone 7 being launched. Feels like one big... purge.

As for the Microsoft health plan changes: I haven't personally taken a bunch of time to figure it out yet. I had a fully scheduled Friday and I half listened to the Town Hall while working. My attention lapsed and the next thing I know they are talking about a Health Visa card against our Health Savings Plan we can use for paying our share of a visit to the doctor and roll-overs and portability. I realized I just missed some detailed stuff. Microsoft has set-up internal forums to help the employees figure this all out, so I encourage everyone to utilize that. But in the meantime, a commenter on the previous post added this:

OK, I just watched the Health Care Town Hall replay. Hard thing to do early on a Saturday morning.

Let's see if I have this straight. If I go with the Health Savings Plan:

1. All my preventive care is still free (to me). Annual physicals, dental checkups, immunizations, etc. - no charge. Wellness programs are actually beefed up even more.
2. For a family of 3+, the most we would have to pay out of pocket annually is $2500.00.
3. At the beginning of each year, MS will themselves add $3725 or thereabouts to my Health Savings Account...so MS is more than covering my $2500 obligation anyway.
4. Even if I have a catastrophic illness or injury, I'm still ahead $1225.

I hope more insightful minds will follow up to correct any misunderstandings I have about this, but my takeaways from LisaB's deck are:

1. Switch to HSP.
2. Lose both legs in a snowboarding accident.
3. Profit!

A follow-up to that:

Not quite right on the healthcare costs. Worse case scenario for family of 3 is:

• All your preventive care costs are covered 100% by MSFT
• You pay 100% of the first $3,750 in non-preventive costs. This is your deductible.
• After your deductible is paid, you pay 10% of non-preventive costs. This is your co-pay. You pay a max of $2,500 in co-pays per year.
• So your max annual costs are $3,750 + $2,500 = $6,250
• MSFT will pay $2,500 into your Health Savings Account each year, so your net out of pocket cost is $3,750. If you sign up for the HSP account in 2011-2013, then MSFT will contribute an additional "early adopter incentive" of $1,250. But after 2013, your max out-of-pocket costs are presumably back to $3,750
• You could pay that $3,750 out of tax-free contributions you make to your own HSA account, but then that money is locked away and can only be used for health expenses. If you don't want your money locked away then you have to pay with after-tax dollars.
• In order to come up with $3,750 in after-tax dollars, you'll need to earn about $5,000 in pre-tax dollars.

So, in the worse-case scenario this is equivalent to a pay cut of $5,000 per year. Maybe not too bad for someone making $200k, but that would be a 10% pay cut for someone making $50k.

Will increasing health care costs follow Ms. Brummel's charted path? It's interesting that the excise portion of the future ended up being a small little bump. Next: wellness - excellent idea. I love ensuring that we're all well and stay healthy upfront. But that includes affecting the ecosystem in which we live and ensuring people actually put time towards preventative health and making a place like Redmond a healthy place to live.

Sidebar: Just to whine a bit: for self-proclaimed bicycle capital, this is one hell of a scary place to ride a bike. Actually ensuring there's an infrastructure from the suburbs-to-work to safely ride a bike to encourage healthy living is some local influence Microsoft should have.

Sidebar two: Via DareO: The exciting nature of being ordinary - Sorting it all Out - one snippet: "Microsoft now looks ordinary to me."

I'm very supportive of whatever they can do about wellness (though the paranoid side of me hasn't liked the 'Know Your Numbers' campaign - who gets access to my numbers? Curiously, this extra overhead might prevent me from getting my flu shot this year).

Do I think the health changes will affect recruiting? Probably not. Do I think it will affect retention? Yes. See the above "ordinary" link. If other tech companies hold steady on their coverage then they close a big gap to hiring experienced people at Microsoft. Look, once you have a family and one or two big boo-boos (medical term) you realize: "holy crap, we are so fortunate... I love this company for caring for me and my family so well!" It's no golden handcuff, but it still anchors you.

Anchors away.

Given cut-backs like this, whether out of cost-saving necessity or not, the Senior Leadership Team has to realize there's zero tolerance now for major money screw-ups like KIN and Massive. The bumbling flushing away of millions or billions of dollars is going to be compared directly to the reduction in benefits: if this company was actually run by people who knew how to consistently achieve profits, we wouldn't be looking at these losses and saying, "Yep, that could have paid for US health-care for a while..."

All-in-all, though, I think (not having immersed myself in the details) our coverage remains a better-than-average benefit. And as long as we don't have to revert back to the Pacific Care Primary Care / Referrals model (talk about a time-waster during work-hours) I'm personally satisfied.

Regarding Live Labs being shutdown: so what's left that Ray Ozzie is running? FUSE labs? You know, the people who blew their internal reputation by hijacking and hacking the Office Web Apps for http://docs.com/ ? I would not be surprised to see Ray finding a new endeavor sooner than later. First Mesh, now Live Labs.

As for Live Labs going into Bing... what the? I've watched a lot of curious hiring and initiatives at Bing. All the best wishes to you Bingsters, but you're beginning to resemble an organization that has way too many people and now you're just creating work to keep them busy. We've seen this before, and curiously, with some of the same leadership that's in Bing now. Better to put them on a productive profit making endeavor or risk having them cut loose.

From the comments:

Let's see if the latest round of "This will bolster the stock price works." IEB re-org and benefit changes. Doubt it.

Checked with some friends in the Interactive Entertainment Business and they glumly report "We're getting Sinofskied." (Not reporting to Sinofsky, but picking up the same kind of management structure.) Ah. I've always been curious if the Sinofsky model holds up in a creative group. Now we have one big example in the making.

Looping back to Mr. Kaplan's ordinary comment: Mr. Matt Rosoff's parting post on leaving Directions on Microsoft expresses it in a different way:

In Seattle, Microsoft was where the all the best and brightest worked, had worked, or wanted to work. People even pronounced it with a particular tone of voice, hushed but awful, like people back East say "Harvard." All-caps. "Yeah, he owns a coffee shop now. But he used to work at MICROSOFT." [...] it's not MICROSOFT anymore. It's just Microsoft. Even in Seattle.

How do you feel about that? You're not ordinary and you don't live an ordinary life. You don't expect to do ordinary work for an ordinary company, do you? What needs to change?

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Mini-Microsoft Microsoft -- Comments

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General Enviroment, Enviormental Scanning and Porter's Five Forces of iIdustry Competition

For Pepsi Company there are several things to think about in the general environment of the business. For instance, with the nation and the world being so focused on the health of the population there might be less people buying Pepsi soda when you think of the demographic group of 16-30. Then on the other side with people older than the 30 who grew up drinking soda they might be less prone to trade out a healthier option for the soda. There are also a couple other things to take into consideration. When it comes to the sociocultural part of the general environment there will be some problems with the people focusing on the health aspect of the products that Pepsi offers. They might be less prone to buy pop and maybe more prone to buying a water or juice in which Pepsi also has products in. I believe they have to focus on pointing out that pop maybe isn’t as unhealthy as everyone makes it out to be. I couldn’t find anything that went with the legal or political side of the spectrum. Technology could be improved to have a better turn out on any of the parts of bottling or production of the many products that Pepsi sells. Thinking about the economical setting of the general environment the rise in minimum wage will have an impact on Pepsi because that will drive cost of making and distributing the products to go up which will in turn raise prices which will maybe put more people on the fence about buying the products all together.

Then there is external scanning which could be the watching of other pop and juice products producers and trying to determine the changes before they happen. This would be like watching Coke products and tracking the trends as they occur. This can help keep the firm with a competitive advantage. Last but not least let’s talk about porter’s five forces model. With much consideration and review it does not seem like there is a potential for new entrants just because Pepsi is a huge company and trying to compete with Pepsi and Coke products may be difficult with both their vast amount of products.  With looking at all the information don’t think they have bargaining power of buyers either.  But people could definitely have substitutes for Pepsi such as coke or other products in the market.

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Friday! Friday! Friday! Microsoft Company Meeting 2011!

(Note: updated below with follow-up comments.)

It's my most favorite time of the year: Friday the 23rd is the annual Microsoft Company Meeting!

That's right: I pull up my sleeves and thrust out my arms out wide and say, "Shove in the Kool-Aid IVs to the left and to the right and keep it flowing!" Man I love it. It is one of my favorite holidays of the year.

Reminder: when it comes to comments, share your internal-only content enthusiasm over on OfficeTalk (especially via the otalk WP7 app) vs. trying to put it here.

A Story of Steve, Steve, and Steven

This year is one of those inflection points: Apple has been soaring with its excellent device results, blowing Microsoft away and cannibalizing our Windows powered device market. The Microsoft stock is horribly flat and there are calls all-around for Ballmer to be replaced. Now, several things are in play: Mr. Jobs has stepped down due to his health reasons, WP Mango is reaching release with Nokia devices to begin their flow, and Windows 8 has demonstrated a reboot to the Windows experience and development platform. With Windows 8, Microsoft has emerged with the talking points that the company is being re-imagined.

All I can say is that SteveB should give SteveSi the CEO Bacon Achievement award: exceptional results that saved the CEO's bacon. Oh, SteveB had to be so happy to have Windows 8 revealed at BUILD right before the Financial Analysts Meeting. "How ya like me n-O-w?!?!" Actually, big chops to SteveSi who not only has done the impossible organizational wrangling between Win7 and Win8 (and wherever it is leading with Win8+) but also did such a smooth job with BUILD that some bloggers dared to pass the Steve Jobs torch to SteveSi. Wow. Didn't see that coming.

(psst. Board. CEO ma-ter-ial. Uh-huh. There you go. Not that I'd probably work in a SteveSi CEO Microsoft, but ya could do a lot worse!)

One thing I'd love to see SteveSi do: give the same level of support to writing Windows8 apps as Microsoft afforded its employees for Windows Phone. I'm not expecting him to, but if he did, I'd relish having my Spock-meets-Spartan view of him rebooted.

The Big Check-in - How Are Things Going

I expect that Mr. Turner will do the big picture for us. I like this comment regarding one point of view of how things are going for Microsoft:

There are certainly some issues at MSFT but some of the people that post in this blog are just over the top in their pessimism and whining.

As I see it right now, the good, bad, and ugly of MSFT are:

The good:

• XBOX Kinect blew it away this past Holiday, over 35M customers now pay for the priviledge of XBox Live
• The enterprise business is strong, committed revenue is higher than it's ever been (MSFT has a global enterprise business that is really unmatched by anyone
• Office365 and Dynamics both are rapidly growing businesses with a ton of upside
• MSFT now has 11 distinct businesses that do over $1B in revenue - I can think of maybe one or two other businesses on the planet (GE, etc) that can say the same
• Largely because of this diverse portfolio of businesses, MSFT was able to grow revenue, operating income, and net income in spite of *declining* PC sales (MSFT is not a one-trick pony any longer, if it ever was)
• Even with weakness in the PC market the past couple of quarters, it's hard to argue with the success of Windows 7 with over 400M licenses sold
• MSFT's Cloud offerings collectively are second to none
• Bing has a long ways to go but has actually made some progress in the US search market against Google, which was once thought impossible
• As an employee, unless you are a bottom 20% performer, the new comp plan is a win. If you don't think so, then you don't really understand the change
• Say what you will about Ballmer, there are some senior execs at MSFT that are truly outstanding. Mattrick, Satya, KT, Qi Lu, PK, Lisa B - you won't find anyone better than these folks anywhere
• The Nokia partnership will be instrumental in getting a WP7 device in a lot of people's hands

The bad:

• As mentioned, PC sales actually declined in Q4
• MSFT still hasn't figured out a way to win in India or China and doesn't seem to have a cohesive strategy for emerging markets
• WP7 is a good product but as others have alluded to, MSFT is way late to the party in terms of highly functional / attractive UI / rich app eco-system smartphones. The Nokia deal only allows MSFT some hope at playing catch-up at this point
• Employees will soon have to pay a contribution (and deductibles) for health care (thank you very much ObamaCare and the Cadillac Tax for bringing that to us)
• Although there are talented people still there, a lot of talented folks have left MSFT senior leadership in the past 18 months or so - Liddell, Elop, Muglia, Bach, etc, etc. Although Elop was instrumental in getting the Nokia deal up and going

The ugly:

• AAPL sold 20M iPhones and over 9M iPads in a quarter. In. A. Quarter. Let that sink in a moment
• While MSFT has plenty of other viable businesses, none is as profitable nor as core strategically as Windows. Windows was once an impenetrable fortress, but in the past year, AAPL has penetrated it with a single product launch. MSFT is destined to play catch-up in slates, and it sounds like nothing serious is coming out until Windows 8 in another 12 to 15 months (maybe)
• MSFT is still very strong in the enterprise but to the consumer, MSFT seems completely dead. MSFT has no consumer mindshare any longer
• Yes, there are some interesting possibilities with Skype and Lync and XBox (etc), but it is still not at all clear that shareholders will reap anything close to $8.5B of value
• GOOG still dominates search in the US and will for the foreseeable future. And their dominance is even greater internationally
• OSD as an org continues to bleed money and will continue to do so for at least another couple of years

There it is, from a high-performing L63 employee in a broad-based business role, trying to lay things out in a truly fair and balanced manner. Take it or leave it.

I'm glad to see The Cloud in the somebody's Win column. When it comes to the Company Meeting, I personally am dreading anything that can be in the least bit tangled up with... sigh... THE CLOUD. Two things lost my respect to this force-fed-bubble-gum-on-my-shoe initiative: first, that using our cloud services is Alpha-Geek hostile: sorry, but there should have been upfront a free tinkering environment to go and write a whole bunch of real fun, heavy computational code. Second, that we started to slap THE CLOUD on crazy crap like home PC image editing.

Really.

So, I don't know, smuggle in a bunch of tequila and limes and whenever THE CLOUD comes up take another hit. That will at least make it palatable... in a numb, doesn't-seem-to-hurt-quite-like-it-did sort of way.

The New Review System and Hiring

Yeah, I think there's zero chance the Senior Leadership Team will go into much depth here. "Cheer if you like the new review system! ... Okay, there's 40% of you. How about the rest? Give me a 'Whoo?'" Want to wade in it? Pour yourself a three fingers of bourbon (and keep the bottle handy) and go through all the comments in the Mini-Microsoft Microsoft Annual Review 2011 post. 1,200 comments at this point. Whew.

Strict stack ranking on a fixed curve is a tool brought in for a purpose that didn't exist in the previous review system. Having LisaB take a break from her sabbatical (and, btw, what happens to most people after their sabbatical?) to tell us it's being done because employees felt that the old review system was too complex is a load of greasy smoke up the keister.

I look at this system and, stepping back, it makes sense if you're preparing to do some major organizational slimming over, say, a three year period. For instance, if SteveB where going to leave, I imagine before he goes he would cut back huge parts of Microsoft versus leaving that task to the new CEO, who might make radically bad cut-back decisions (from the former CEO's point of view). Better to give over to the new leader a starving company ready to grow versus a fat pig you've got to go all Neutron-Jack on. Three more years. Three more years to drive down until today's lower 3s are FY2014's 5s.

Depending on who is being forced out or leaving, too, the new system might help with the Young up Microsoft initiative I hear whispers of.

Whoo-and-Hoo!

Didn't like your review? Ah, come on. You know when Ballmer runs around the field you're going to scream and shout (though, given the last Ballmer memo's authorship, maybe we'll see Frank Shaw run around first to warm things up). You're going to stand up. You're going to put aside all the depressing thoughts of those golden handcuffs never unfolding into a sparkling world of wonderment and retirement. You've got a job, a colorful CEO, perhaps a nice raise, and a company holiday to find out what's going on and to have some free grub with your work buds. Compared to 99% of the rest of the world right now, it's worth swigging the Kool-Aid for at least one day and cheering.

There's always the rest of the year for everything else.

Updated: impressions and follow-up

Overall: a very competent Microsoft Company Meeting. Polite applause. "Pip pip."

Other than the occasional video (heh heh, Inception) and the first one or two Train Dances, it was a low-on-humor meeting, for me. Everyone wondered if we were having a host this year. Hey, it was LisaB. Competent (and probably didn't piss people off like last year).

This year was demo-rama. I think the demos were good, it's just I had seen so much of everything being presented that there weren't too many surprises for me. I loved the fact that SteveSi ran one of his demos and then pointed out that everything he had just done was on an ARM slate. I regret how much money we're pouring into OSD (who pointed out that they are quite frugal - uh-huh) but I agree with a lot of what they are doing: they are not trying to out-Google-Google. They're Bing'ing Google upside the head. Go, Cosmos, go!

As for Mr. Ballmer: it was a surprise that he didn't come running and screaming out but rather had a surrogate fly around like a chimp on crack dusted with meth. Mr. Ballmer seemed more subdued this year. Love for Ballmer? People still stood up and cheered and clapped for him. Now then: someone please tell him, regarding his analogy of himself and Elop and Windows Phone sticking together, how Butch Cassidy and the Sundance Kid ended. Yeah, they were together alright, but the result was a little bit different than jumping off a cliff into a river.

As for people leaving (as some of the tech bloggers have picked up): yeah, people were streaming out. In small numbers. No where near as bad as BillG's last company meeting where Ballmer started screaming at people to sit down. And, well, yes, I was one of those folks who wandered to the upper portion of the seats while Mr. Ballmer passed on his coachie wisdom from Friday Night Lights (BTW, I prefer coach John Wooden). I suppose if Microsoft had been serving beer and snacks after the meeting I would have managed to stay in my seat.

So for me: technically well executed. Pip pip. I feel good about what Microsoft has wrought and how many of the things we're doing are exactly the kind of big, cross-group bets folks used to complain how we never do. The Imagine Cup winners were great to see. Pip pip. As for the meeting... I'd like a little culture, too. Maybe less inspirational videos. And more crazy. Not burping game crazy or Craig Mundie dazed-crazy, but show we have some pizzazz... with less explosive volume. And I'm fine with a box lunch if it means I don't have to stand in an infernal line to get a luke-warm burger melded to its bun.

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Mini-Microsoft Microsoft -- Comments

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Coca Cola development strategy success

           

            For sure, brand loyalty is an important variable in maintaining Coke’s number one position. Founded in the year 1886, the Coca Cola company is the biggest non alcoholic beverage company of the world. It has a distribution system, which makes it unique from the rest of the soft drink manufacturers. Over the years, Coca Cola has enhanced the brand through tests and the company continues to communicate as much as possible to stay in consumer’s mind.

The brand development strategy of Coca Cola included brand and product development, but also techniques and strategies in order to keep up with the switching and changing trends of its consumers.

            Earlier, this brand believed in affordability, availability and acceptability.

However, brand development strategy of Coca Cola was reworked to match a higher loyalty and equity. They have based their branding on price value, preference and “pervasive penetration”. 
In order to have an effective brand identity, Coca tests each month more or less 20 attributes involving as many as 4000 customers. 
           The brand development strategy of Coca Cola has been able to build, manage and maintain its brand image according to consumers’ attitudes and behavior. 
A worldwide acceptance and a constant brand image has been possible thanks to brand loyalty; Coca Cola is connected with its customers and they do not count expenses on that field. 
Constant communication enables to enhance frequency of purchase, which is instrumental for brand loyalty. Also, by responding to a trend and a need which is “health” and “diet”, Coca Cola has segmented its market into 3 parts: Classic Coke, Diet Coke for girls style-conscious about their weight and Coca Cola Zero for men, promoting an unconventional but effective ad. Coca Cola went from “the real thing” to “many things” successfully thanks to its positioning and branding strategy.

Sources:

http://fr.scribd.com/doc/22027744/Coca-Cola-Branding-Strategy

http://fr.scribd.com/doc/46403814/Coca-Cola-CBBE-Model 

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Ch. 5 - Developing a Global vision

Coca-Cola is a multinational corporation, "A company that is heavily engaged in international trad, beyond exporting and importing", MKTG text book, p.57.

It all started in 1920 and 30's, the company began a major push to establish bottling operations outside the U.S.. The first countries were France, Guatemala, Honduras, Mexico, Belgium, Italy, Peru, Spain, Australia and South Africa. After the fall of Berlin wall the company heavily invested to built it name and roots in the Eastern Europe. By the end of the 90's the bottling system grew up with roots deeply planted in local community over the world.

Coca-Cola is the largest company in the world of nonalcoholic, ready-to-drink, beverages. The company has more than 300 bottling partners worldwide.

Coca-Cola is focuses on create a positive difference in the world. The company focuses on 7 core:

1. Beverages benefit: variety of beverages that will fit every lifestyle with quality.

2. Active healthy living: support health through product variety, nutrition education and physical activity programs.

3. Community economic development: creation of economic and social opportunities.

4. Energy efficiency and climate protection.

5. Sustainable packaging.

6. Water stewardship.

7. Work place: create diverse with international respected human rights.

Coca-Cola manufactures the beverages bases and syrups and sells them to bottling operations. The company owns or license the brand and focuses on marketing activities as advertisements, online programs, package design and etc to connect the brand to the costumers. Coca-Cola company does not own or control most of the bottling partners.

Coca-Cola company constantly exploring new ways to improve business and enhance relationships with farmers and consumers. Expending beverages and improving packaging, sales equipment, distribution and costumer service is the way the company has been building the business. The goal is to reward the shareholders, satisfy costumers and contribute positively communities around the world.

" There has never been a better time to be in the business of refreshment, Local languages may be differ but the language of refreshment is universal", said Muhatar Kent, Chairman of the Board and Chief Executive Officer.

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Success of Pepsi branding strategy

Customer Desired Benefits : Pepsi has been successful in capturing the Youth Spirit.It has also ventured out to different customer segments with different offering for e.g. Diet Pepsi was introduced to cater to the health conscious people. Pepsi’s entire Product Portfolio caters to the different customer segments.

Relevance : It’s  considered to be a new generation drink, the drink has managed to grab the imagination of Teens and young Adults alike. Pepsi through the combination of innovative ideas (like Pepsi Blue even though a failure), effective communication and aggressive advertising has been able to stay relevant to its customers.

Pricing : based on consumer’s perception of Value and on the market. Pepsi isn't on a price war with coke in order to keep its brand equity.

Brand positioning : The brand positioning is based on its sweet sugary taste suited for its young consumers. Thus it was able to create a Point of difference from Coca cola.

Consistency : Pepsi has maintained continuity in its brand image and has been consistent in its brand promise of refreshing drink for Youth. It has always depicted a defying attitude and continued to challenge the market leader. Its campaign have been about making a mark and proving its real benefit among young people & cool people.

Brand Portfolio and hierarchy : All Pepsi brands cater to different market segments and rarely cannibalize each others sales. It also gives Pepsico optimum market coverage as its products are diversified.

Repertoire of marketing Activity : Pepsi’s Brand Elements are distinctive and the awareness is very high. It has an extensive distribution network. Promotional campaign have also been innovative in the usage of social media like Facebook ore twitter .

Internal Branding : Pepsi’s give it brand manager the liberty to experiment  ideas to capture customers at the bottom of the pyramid. Pepsi also has predefined set of rules that brand manager should follow which is meant to develop a sense of ownership for the brand.

Sustainable and support marketing programs : Pepsi marketing team is probably the most innovative when it come to determining go to market strategy for its product. The company’s marketing expenditures are very high.

Monitoring Sources of Brand Equity : Pepsi has a series of monitoring programs like periodic brand audit, routine brand sales tracking, monitoring brand performance, etc.

Pepsi branding strategy is very effective. Its brand value has been estimated to $12,762 million.

Source:

Building, measuring and managing Brand equity, Kevin Lane Keller

Pepsico.com

http://www.marketingweek.co.uk/brands/pepsico/ 
http://www.ideasmakemarket.com/2012/03/ideasclash20-entry12-branding-strategy.html
http://article.unipack.ru/eng/18573/
http://fr.slideshare.net/rohitpatel203/branding-of-pepsi-cola#btnNext

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A Case of the Microsoft Downgrade Blues

Oh, great, we've hit a case of the downgrades as a sequel to the quarterly results that no-one bought.

Specifically, Ms. Friar at Goldman Sachs downgraded us with a variety of reasons and expectations. From Mr. Todd Bishop: Goldman downgrades Microsoft, makes case for major overhaul. Snippet of some gold Goldman Sachs from there:

They call for three steps to "unlock value" in Microsoft's shares.

(1) A materially increased dividend beyond the recent 23% increase, moving Microsoft into the top 20 dividend-paying companies in the S&P 500 in terms of dividend yield. We believe this would open the door to a larger investor base and keep the company more diligent from a spending perspective. (2) A coherent consumer strategy that could involve paring back investments and/or divesting more peripheral assets such as gaming. (3) Market leadership in Cloud. Microsoft has a strong portfolio of enterprise data center assets and could become a leader in Cloud deployments, but the competitive environment remains highly in flux, with Microsoft still not a clear "winner," in our view.

Flashbacks to MSFTExtremeMakeover's last blog entry: Eight Years of Wrongness. Upgrade the "Eight" to a "Ten".

The more interesting follow-up by Mr. Bishop is adding up the numbers in Goldman Sachs' assessment comes up with a $30 share price vs. Goldman Sachs' downgrade to $28: Numbers How Goldman Sachs values each Microsoft division.

Now then, if this report was dated, say, 2006 I would be remarking at the exceptional smarts and bravery of Goldman Sachs to step forward from the meek institutional investor crowd that have been giving Microsoft a free ride. Instead, now that the farm's barn doors have been wide opened for a while, Ms. Friar is walking around saying "Without preventative re-enforcement and diligence of door utilization, it's possible for the horses to escape from here."

The timing is just peculiar, and is resulting in the resumption of resignation requests for Mr. Ballmer: CNBC's Fast Money Microsoft's Steve Ballmer Needs to Go Analyst. Also, Ms. Victoria Barret follows-up with Goldman to Microsoft Do Something - and reflects on her summer story Time to Break Up Microsoft.

Sorry Mr. Institutional Investor, your voice was needed years ago. You have been complicit and ineffective during the worst of it. What's the agenda here? It would have been better for a coalition of institutional investors to speak with one voice, vs. Goldman Sachs. Because... given how Goldman Sachs has proven itself untrustworthy in attempting to destroy the American economy for its own fortune (cue their extended pinky touching edge of mouth), you have to wonder if they have their own greedy agenda - are they betting against the Microsoft stock and expect to benefit from its near-term decline? Or hope to force in a Neutron-Jack CEO to wipe out half the employees and all non-profitable groups?

Or do they expect within a year for Microsoft to have had a very successful consumer cycle and then reward that with an upgrade, in the meantime having had bought up a good bit of cheap stock? Are they looking for quick short-term gains vs. a thoughtful consideration of long-term growth? I feel a baleful gaze cast on us.

And mainly: it's a very poor matter of timing for a break-up. We're about to have a mobile phone come out that actually binds the companies divisions far closer than ever before: Office, Windows Live, Xbox Live, Bing, and Dev Div: this damn thing is the antidote for break-up talk. WP7 wouldn't be impossible to create with a break-up, but it'd be exceptionally difficult. WP7 is pulling together huge resources that none of our direct competitors have.

Now then: stepping back to Classic-Mini mode. Would I like to spin off parts of Microsoft. Oh yes. Less money wasted and less people? It's a Win-Win two-fer. How about our health solutions group to start with? Other Fools: Online Services Division: Microsoft Time for a Break-Up?

I think it would be healthy to actually encourage spin offs. Give new groups funding for two years and then assess whether this will continue to be a Microsoft endeavor or not. If not, the group can spin off as their own new company, with Microsoft as a stake-holder, and go their own way. So if Midori is not in our future then tip the hat to them and let them take off on their own.

Back to Mr. Ballmer. If you want to end on a high-note, now's the time. Mr. Ballmer can declare victory in the continued success of Windows 7, the innovation of Bing that's rattled Google, the alignment of products around the cloud, Kinect, and Windows Phone 7. It's going to be a while until the stars set themselves up like this again. Better to go out with victory than be chased out of Salmonberg by a bunch of fed-up institutional investors wanting real dividends and stock performance. You know: shareholder value.

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Mini-Microsoft Microsoft -- Comments

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Innovation

PepsiCo is a big innovation company. They have so many different lines of drinks from sodas to waters and they seem to do such a good job with the changing with the times. With the health concern that has been happening there has been a trend of the healthier drinks coming out on the market. With that being said they seem to foster innovation within their company to keep up with the trends in the market. They also have innovation in the technology and how they get their product out for example their vending machines and their dispensaries that they have in restaurants which is making them more technologically advanced which is changing with the times.

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Ch. 8 - Segmenting and Targeting Markets

Coca Cola Company is the world’s leading manufacturer, marketer, and distributor of soft beverages. Coca Cola uses "Multisegment" targeting strategy which means that the company has more than single, well- defined, market segment.  It develops a marketing mix for each of the segments. Coca Cola has more than 400 different products line, total of 3,500 product mix.

Geographic segmentation

Coca Cola has drinks that targets different age groups, ethnic groups, sexes, lifestyles, etc. Examples:

- Oasis- Juice made for the younger working adults, between the ages of 20-30. The product is available in different flavors (berry, lemon, and orange tangerine). It’s mostly popular in Britain and Ireland. 

- Coca Cola- the most popular soft drink so far that being sold in most countries in the world. The large demand for its taste and the trend toward healthier lifestyle influenced Coca Cola to produce healthier products such as Coca Cola Zero, Diet Coca Cola, and etc. 

- Coca Cola Zero- targets teens that don't want calories but want the taste.

- Diet Coca Cola- targets adults, between 30-50 who are health conscious but want the taste.

- Powerade- sport drink, targets athletes between 13-27 ages.

- Minute Maide- targets kids and adults from 1 year to 10 and 40 plus. It’s convenience to carry. It targets parents that want their children to drink healthier drinks.

Climate- Coca Cola’s consumption in the summer is 60% than 40% in the winter; therefore, the company's sales are higher in the summer. It also focuses in hot area in the world.

Demographic segmentation

-Age- 15-25 years old and 40 plus.

-Gender- targets both genders with wide variety drinks.

-Income- segments different income level. for example, by packaging: for low level income the company is selling returnable glass bottle; for high level income, the company is selling coke in tins.

Psychographics segmentation

People who are brand conscious will not drink beverages of less known brands. They will try to show their status by drinking Coca-Cola.

The level of education is another factor that the company is paying attention to. In an high percentage education, the company can use advertisements to convey the company massage.

Because Coca Cola is a recognized world brand, people will drink it without hesitate. 

Coca Cola designed to satisfy the consumer’s needs. The company is able to provide drinks for many different target markets: ages, sexes, and etc. The products are sold to diverse population all around the world. In our world today, people want to live healthier lives. Coca Cola recognized this need and begun to produce different beverages that are satisfying those consumers. Coca Cola products are purchased by different classes, but mainly by middle to high level class. In addition, many people today make their purchases decisions based on the company’s ethics and, or social responsibility. Coca Cola gains the trust of its consumers by contributing to the environment in varies ways.

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Add for Ch. 4- Marketing Environment

(To fix my definition for Cola-Cola's target market on chapetr 4 post),

 

Coca-Cola target market is based on age, the most potential consumers are teens and young adults; between the ages of 14-25. Coca-Cola has been trying to reach consumers over the age 40's as well.

Over the last decade the company has focused on second target market of consumers that are health conscious and interested in buying products to support the lifestyle. The company produced product lines and provided healthy resources and marketing of products that fit the lifestyle in their website.

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