Dr Evil and Comical Ali advise Microsoft on Zune sales
There’s a very funny scene in the movie Austin Powers: International Man of Mystery where 1960’s bad guy Dr Evil steals a nuclear weapon and holds the world hostage for $1 million, not realizing that $1 million is not really a lot of money in today’s world.
Zune: a marketing strategy Dr Evil would be proud of
Microsoft has just made a similar error of judgement, with its proud announcement that it is on track to achieve sales of more than 1 million units of its Zune portable music player by the end of June 2007. Microsoft doesn’t seem to realize that 1 million units is not really that many.
Microsoft never stated its original sales targets, so when its says it is “on track” to achieve sales of 1 million units, it’s hard to know whether it really is happy with the sales figures, or whether it just thinks consumers are going to impressed with a big number.
Worse, Zune’s market share of media players is slipping. At launch Zune held 9% of markets, and in the middle of November this has slipped to 2%, according to market research firm NPD Group.
While 1 million might sound like a big number to some, Apple has already sold more than 70 million iPods since 2001. Apple continues to sell between 2.5 and 3.5 million iPods a month, so that by the time Zune hits 1 million, iPod sales will have hit somewhere between 90 and 100 million units sold.
A Microsoft spokesperson said that the company was not worried that sales of the Zune had dropped every week since launch. In a Comical Ali-like statement, she said: “While this is expected, our focus is less on week over week numbers, and more on the incremental sales that are leading to overall growth of the category.”
Given that Microsoft is a very competitive company, which works hard to be a dominant player in the markets it enters, it’s hard to believe that it would be satisfied “incremental sales” that are growing the “category”.
It will be interesting to see how Zune sales pan out in the next twelve months, and how patient Microsoft as it tries to makes a dent in iPod’s market domination. With Microsoft failing to position Zune as “cool”, I doubt it really has a chance of being the hit that Microsoft really needs it to be.
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December 7th, 2006
I think 1 million is a good start. Only a fool will compare Zune to iPod right now and there seem to be a lot of fools out there.
December 7th, 2006
How you are not going to compare them? zune is in for get some DAP marketshare, you have to compare iPod and zune if they are competing products.
December 11th, 2006
They won`t even meet these sales targets, that`s why they will not realease any sales figures. Really, only a complete loser would buy a Zune. DRM, DRM and ohhhh MORE DRM.
November 10th, 2007
I think it is unfair to compare the sales numbers of a 6th generation device with those of the 1st generation Zune.
I have not seen a editorial (proper journalism) article which quoted Microsoft as touting the 1st generation Zune as a 5th or 6th generation iPod killer. There is a lot of hype behind all of that generated by bloggers.
If someone is really fair to both devices I would find it hard to believe that one or the other is really that bad. There are things I dont like about my zune and there are things I dont like about an iPod.
DRM aside, I am not willing to pay .99 a song. I have 20K+ songs I have downloaded from the Zune Marketplace. I will not spend $20K if I pay $14.95 a month for the rest of my life. That was my motivating factor.
Comments like “only a complete looser” are not helpful to any intelligent debate about the merits of each product.
November 10th, 2007
After doing some research I found that Apple did not sell 1 million devices in their first fiscal year of sales. They did not break 1 million sales until Q3 of their second fiscal year selling the iPod. This is not to say that the Zune is better because it sold more, quicker. It is merely to say that if you are going to make comparisons at least compare apples to apples.