Marketing Assignment Group 3_Microsoft Coperation

GROUP ASSIGNMENT (27/1/2021) Subject: Principles of Marketing A20BS0201 Section: 4 A20BS0156 Lecturer: Dr. Mazilah Binti Abdullah A20BS0119 Group 3: A20BS0072 A20BS5001 Ida Bagus Rai Satria Dharma Wan Pui Yee Saraswati Subramaniam Nadiahtul Assyiera Binti Nor Azman Shafa Chairunissa

Table of Contents 1. COMPANY BACKGROUND AND MARKET ANALYSIS.............................................. 4 1.1. MICROSOFT DESCRIPTION................................................................................... 4 1.1.1. MISSION.......................................................................................................................................................4 1.1.2. VISION:.........................................................................................................................................................4 1.1.3. CORE COMPETENCIES:........................................................................................................................4 1.1.4. BUSINESS PORTFOLIO/SBU...............................................................................................................5 1.2. MICROSOFT BUSINESS AND MARKETING OBJECTIVE....................................... 5 1.3. SWOT ANALYSIS...................................................................................................... 7 1.4. MARKET ANALYSIS................................................................................................. 8 1.5. MICROENVIRONMENT ANALYSIS.......................................................................10 1.5.1. COMPANY.................................................................................................................................................10 1.5.2. SUPPLIERS.................................................................................................................................................10 1.5.3. MARKETING INTERMEDIARIES....................................................................................................11 1.5.4. CUSTOMER MARKET...........................................................................................................................11 1.5.5. COMPETITORS........................................................................................................................................11 1.5.6. PUBLIC........................................................................................................................................................12 1.5.6.1. FINANCIAL PUBLIC..............................................................................................................12 1.5.6.2. GOVERNMENT PUBLIC......................................................................................................13 1.5.6.3. MEDIA PUBLIC.......................................................................................................................13 1.6. MACROENVIRONMENT ANALYSIS......................................................................13 1.6.1. SOCIAL AND CULTURAL....................................................................................................................13 1.6.2. ECONOMIC...............................................................................................................................................13 1.6.3. TECHNOLOGICAL................................................................................................................................14 1.6.4. ENVIRONMENTAL................................................................................................................................14 1.7. DEVELOPING STRATEGIES..................................................................................15 2. MARKET SURVEY ....................................................................................................15 2.1. DEMOGRAPHIC .....................................................................................................15 2.2. PRODUCT SURVEY ................................................................................................18 3. MARKETING MIX: XBOX........................................................................................ 23 3.1. PRODUCT.............................................................................................................. 23 3.1.1. PRODUCT CLASSIFICATIONS ..........................................................................................................23 3.1.1.1. SPECIALITY PRODUCTS.....................................................................................................23 3.1.2. PRODUCT ATTRIBUTE........................................................................................................................24 3.1.2.1. PRODUCT QUALITY.............................................................................................................24 3.1.2.2. PRODUCT FEATURES..........................................................................................................24 3.1.3. BRANDING...............................................................................................................................................24 3.1.4. PACKAGING............................................................................................................................................24 3.1.5. PRODUCT LINE......................................................................................................................................25 3.1.6. PRODUCT LIFE CYCLE (PLC)............................................................................................................26 3.2. PROMOTION......................................................................................................... 27 3.3. PLACE.................................................................................................................... 28 3.3.1. ONLINE STORE......................................................................................................................................28 3.3.2. PHYSICAL STORE...................................................................................................................................28 3.4. PRICE .................................................................................................................... 28 3.4.1. FACTORS AFFECT PRICE DECISIONS..........................................................................................29 3.4.1.1. INTERNAL................................................................................................................................29 3.4.1.2. EXTERNAL...............................................................................................................................29 3.4.2. PRICE STRATEGIES..............................................................................................................................29 3.4.3. NEW PRODUCT PRICING STRATEGIES ......................................................................................29 3.4.4. PRODUCT MIX PRICING STRATEGIES ........................................................................................29 4. EXECUTIVE SUMMARY.......................................................................................... 30 4.1. MARKET FACTORS AND TRENDS ....................................................................... 30

4.2. PRODUCT AND SERVICES.................................................................................... 30 4.3. CUSTOMER BASED AND MARKETING ACTIVITIES........................................... 30 4.4. FINANCIAL PLANNING AND PROJECTIONS...................................................... 30 4.5. OBJECTIVES AND STRATEGIES........................................................................... 30

1. COMPANY BACKGROUND AND MARKET ANALYSIS 1.1. MICROSOFT DESCRIPTION 1.1.1. MISSION Microsoft cooperation mission is : “Our mission is to empower every person and every organization on the planet to achieve more.” According to Gregory (2019), the mission statements show he the benefits and achievement that worldwide users and businesses institutions from the global market can obtain through computer technology provided by Microsoft products. 1.1.2. VISION: Microsoft vision statement is : “to help people and businesses throughout the world realize their full potential.” Gregory (2019) defines Microsoft vision statements as representing to aid individuals and organizations in the global market by creating an opportunity for them to recognize their business purposes yet achieve it through Microsoft technology products. According to Microsoft CEO Nadella (2017), Microsoft had new changes to its corporate vision, which is “ Our strategy is to build best-in-class platforms and productivity services for an intelligent cloud and an intelligent edge infused with artificial intelligence (“AI”). In comparison, Microsoft past corporate vision, “Our strategy is to build best-in-class platforms and productivity services for a mobile-first, cloud-first world.”, that is focus on communication and interaction for mobile users through technology and provide, gather, process data through Microsoft cloud storage solution. 1.1.3. CORE COMPETENCIES: Microsoft core competencies include corporate values, which is: 1. Innovation Microsoft corporation emphasizes that technology is used to gain benefits. Thus, the company invests in research for various fields that include AI, computer vision, human-computer interac- tion, security, privacy and cryptography, systems, and networking. 2. Diversity and inclusion Microsoft develops improvement es an environment by considering opinions from different per- spectives, including employees and customers' experiences, strengths, challenges, and thinking skills. 3. Corporate social responsibility

Microsoft is concerned about welfare and well-being communities. It provides a solution, ap- proach, and policies in privacy and cybersecurity, skills for employability, environmental sustaina- bility, and technology for nonprofits. In conjunction with pandemic Covid-19, Microsoft provides job seekers resources for the unemployed and invests in AI for health. 4. AI Microsoft invested in AI to better by solving problems in the environment, accessibility, humani- tarian issues, cultural heritage, and health. 5. Trustworthy computing Microsoft ensures the data, privacy, and security is secured during digital transformation and data transaction. President and Chief Legal Officer of Microsoft, Brad Smith, said “ If we can’t protect people, then we don’t deserve their trust.” 1.1.4. BUSINESS PORTFOLIO/SBU Business portfolio Microsoft Corporation analyzed based on BCG matrix that involved stars, cash cow, question mark, and dogs. Market Growth Rate Stars Question Mark Low High • Windows Operating sys- • Microsoft Phone hard- tems ware segment • Microsoft Office • Microsoft Lumia and Cash cow non-Lumia phones Dogs • Xbox one • None • Xbox 260 High Low Relative Market Share Diagram 1: Business Portfolio of Microsoft Corporation 1.2. MICROSOFT BUSINESS AND MARKETING OBJECTIVE 1. Support inclusive economic opportunity Microsoft guarantees healthy economic growth in society.

2. Protect fundamental rights Microsoft eliminates injustices in the world to ensure everyone has their own rights. 3. Commit to a sustainable future Microsoft insisted on taking on taking care of our Earth to have a sustainable future by taking action, including carbon negative and build planetary computing platform to control Earth’s natural system. 4. Earn trust Microsoft ensures that every customer's privacy and security every customer's security are pro- tected, right and beneficial use of AI and transparency.

1.3. SWOT ANALYSIS Strength Weakness 1. Brand reputation leads to higher profit 1. Lack of invention and high demand in market • Xbox is video gaming product created by • Customer not satisfaction towards Microsoft and released on 15 November Microsoft products such as Xbox 2001 and customers still values Xbox till today. 2. Low consistency to maintain at high 2. Constantly upgrading product qualities to quality and high possibility of damage to sustain a place in a crowded market. quality of Xbox due to Microsoft provide low budget for Xbox quality control • Microsoft created Xbox 360, Xbox One, Xbox One S, Xbox One X, Xbox Series S, Xbox Series X that have high market demand 3. Microsoft products overpriced 3. Has global nature in field of company's 4. High employee turnover rate supply chain and strong distribution channel • Xbox has strong presence on social media ( Facebook, Instagram ) • Ensure involvement of product in virtual and physical locations to reach global target market 4. Always maintain company's global business partner • Xbox have large number of customers around the world that enable company obtain extra profit for SWOT Xbox Opportunity Threats 1. Microsoft uses social media such as 1. Increase competitions of Microsoft Facebook, Twitter and Instagram to promote their Xbox, which attract many • For example, some players offer users and receive feedbacks. broadband for free to sell Xbox that lead to reduced revenue for Xbox if Microsoft • For example, Xbox in which everybody in maintain its price. Otherwise, it will cause different countries use that product and a loss of market share creates a new marketplace. Substitute products 2. Microsoft hire skilled labor that able to • For example, Xbox has competed with help reduce training and development Play Station 2, which has high demands. cost through internship programs from institutions. 2. Technology changes 3. Population is a great opportunity to all • Microsoft kept up with constant organizations because they can predict the technology changes, such as training number of potential customers. workforce according to technology change • The population has been growing for 3. Consumer change almost every country, Malaysia's • population for 2020 increased 1.51%. Microsoft do modifications or innovations to their product to fulfill • The benefits are the number of target consumer needs. markets for Xbox also will be increased. • Example, Microsoft keep doing design for Xbox to get the market place such as created Xbox 360, Xbox One, Xbox One S, Xbox One X, Xbox Series S, Xbox Series X

1.4. MARKET ANALYSIS Market analysis is a thorough assessment of the current market to have a better understanding of value and volume of the market, potential customer segments, and buying patterns, the competition, barriers to entry, and industry regulations that help you to make a smarter strategy for growing your business A. Industry Overview Microsoft is a company that runs in technology focused on helping people and businesses realize their full potential. Microsoft creates technology that transforms the way people work, play, and communicate across a wide range of computing devices. For examples, Microsoft has an Xbox company that runs an entertainment and gaming company that We generate revenue by developing, licensing, and supporting a wide range of software products and services, including cloud-based services, designing and hardware of sale, and delivering relevant online advertising to a global audience. Our most significant expenses are compensating employees, designing developing, manufacturing, marketing, selling our products and services, and income taxes. B. Target Market Segmentation Criteria Microsoft Target Customer Type of Segmentation Segment Geographic Region Global marketplace Density Urban and rural Demographic Age 16 and older Gender Males and Females Life-cycle stage Bachelor stage young, single peo- ple not living home Newly married couple young, no children

Full nest I youngest child under six Full nest II youngest child six or over Occupation Students, employees, profession- als Behavioral Degree of loyalty Hardcore loyal Softcore loyal Benefits sought Efficiency, accuracy, speed Personality Determined and ambitious User status Non-users, potential users, first- time users, regular users, and ex- users Psychographic Social class Lower class, working class, mid- dle class, and upper class Lifestyle Mainstreamer Aspirer Succeeded Explorer Table 1 : Target Market of Microsoft Corporation

1.5. MICROENVIRONMENT ANALYSIS All those micro factors that impact business strategy, decision-making, and efficiency are part of the mar- keting micro environment. Before the decision-making process, it is important to perform macro environ- ment and micro environment research for company performance as they would affect the corporation's business operations. Business micro-environment variables include the company, suppliers, marketing in- termediaries, customer market, competitors, and public. 1.5.1. COMPANY In Microsoft Corporation organizations, they work together to achieve the company's objective, which is to provide superior customer value and relationship. Figure 1: Microsoft Corporation Organization 1.5.2. SUPPLIERS Microsoft created a great program called Microsoft Supplier Program (MSP), which determines how key business-critical and strategic suppliers, including specifications and goals, do business with Mi- crosoft, thus allowing for a direct path to success. Having a chosen supplier makes it easier for Microsoft teams to work with a prequalified group of suppliers globally. The suppliers of Microsoft are compliant, competent, and competitive. They represent a dedication to the diversity of products and services that are the best in class. Upon joining the Microsoft Supplier Program, a supplier becomes eligible for program

benefits where they could get; recognition, participation in events, training, and a variety of resources. Un- der Microsoft Supplier Program, there is an Excellence Award Program where suppliers with higher per- formance, exemplary service, and innovation are rewarded by Microsoft Corporation, thus giving them the recognition, they deserve. 1.5.3. MARKETING INTERMEDIARIES Since there is a lot of product produced by Microsoft Corporation, their business typically goes through multiple distribution networks to deliver a finished product to the end customer. The market in- termediary acts as the link between the product and the consumer is one of the critical-critical distribution facilitators. Since they are such an essential component of the distribution chain, these intermediaries not only place goods on shelves or directly into the consumer's hands, but they also have brilliant insight into how products can be better advertised. Microsoft also created a reliable platform for its partners to sell Microsoft's products with ease. For example, Microsoft Authorized Device Reseller Program is created to help their partner resell Surface devices to their customers. This program includes benefits for the reseller where Microsoft provides resources like sales tools, marketing campaigns, and training sell Surface devices successfully. Other than that, Microsoft also focused on their online retail much more after the pandemic Covid-19 strike. They retail operations online closed nearly all their physical store and moved their retail operations online, which is called Microsoft Store. This step make it more comfortable for their customers to purchase Surface and X-Box online without having to go out and expose themselves to the virus. 1.5.4. CUSTOMER MARKET Microsoft is can communicate effectively too with their customer because of its strategic market- ing plan. They use plenty of communication channels such as personal selling, direct marketing, public relations, experiences and events, sales promotion, and advertising to relay their customers' marketing mes- sages. This strategy ensures of that all of their customers are aware of the latest products and shows that Microsoft has for them. For example, Microsoft product, Windows are used widely around the world since its compatible with many computer devices. They focus on upgrading Windows to fulfil customers' needs, thus luring in new customers with their well-known, trusted brand. Each of Windows updates improves their customers s experiences, whether it's more comfortable to access their new Windows from their lap- top or even the new look that Windows presents computer. Overall, Microsoft keeps on working hard to increase their customer's satisfaction with their products, and they also try to remain superior within this competitive market. 1.5.5. COMPETITORS As big as Microsoft Corporation, they still have competitors to look out for. Their primary com- petitors are the most prominent technology companies in the industry, such as Apple, Google, Oracle. The high number of Microsoft Corporation competitors are much likely because Microsoft not only produces one type of product but also a variety of them. Microsoft not only focuses on their software program but

also branched out with other products such as laptops, phones, and even video game console. Thus, this lead to competition of various products produced by Microsoft Corporation with various of other compa- ny's products. For example, Apple, which holds the second position in the global operating system market with 9.4 percent of its MAC OS share, is Microsoft's biggest competitor. With Windows, the world's most extensive operating system with 87.7 percent of market share, Microsoft is the undisputed leader in this segment. Created in 1977 by Steve Jobs, Apple has 137,000 employees and reported $260 billion in sales, while Microsoft closed with 14,000 employees and $126 billion in 2019. 1.5.6. PUBLIC The public is any group that has an actual or potential interest in or impact on a company's ability to achieve its goals. They are a few types of the public involved with Microsoft Corporation, such as the financial public, government public, and media public. 1.5.6.1. FINANCIAL PUBLIC This group influence Microsoft Corporation's ability to gather funds. Rank Shareholders Name Shares Owned 614, 100, 233 1 The Vanguard Group, Inc. 515, 509, 179 299, 126, 371 2 BlackRock Fund Advisors 222, 257, 473 177, 500, 157 3 SSgA Funds Management, Inc. 117, 798, 162 110, 441, 260 4 Fidelity Management & Research Co. 95, 506, 129 91, 995, 988 5 T. Rowe Price Associates, Inc. (Investment Management) 91, 215, 100 6 Geode Capital Management LLC 7 Capital World Investors 8 Capital Research Global Investors 9 Capital International Investors 10 Northern Trust Investments, Inc. Table 2: Top 10 Microsoft Corporation Stakeholders

1.5.6.2. GOVERNMENT PUBLIC Microsoft Corporation has faced a few legal charges by the government. Since then, they have upgraded their services. To avoid compilations with the government again they have launched Government Security Program in 2003 to assure their customers that their software is secure and free of backdoors. 1.5.6.3. MEDIA PUBLIC Microsoft used to have their magazine called Microsoft Developer Network Magazine, which s been guid- ance to Microsoft developers' community has been a guidance to Microsoft developers' community. Still, it has published its last issue in November 2019 and ended there after three decades of publishing. 1.6. MACROENVIRONMENT ANALYSIS 1.6.1. SOCIAL AND CULTURAL Factors consist of changing demographics, patterns of employment, lifestyles, and attitudes. More and more people are becoming technology savvy, and the new generations are highly computer literate. A higher percentage of women across the world are employed, increasing the consumer base for computing products. The concept of home computers is well accepted. The aging population of the world may hold adverse effects for the industry in the time to come, as the number of people working will be drastically reduced up to 35% of the population while over 50% will be retired. 1.6.2. ECONOMIC Forces can be noted in the slowdown in the global economy and the increased competition from cheaper sources as India. The turbulent currency markets also affect large-scale global companies as Mi- crosoft, increasing financial risks. The aging population of the world will retire in time to come, leaving a smaller percentage of world population in the workforce. This trend is likely to affect the world economy adversely, slowing down growth and development across the world.

1.6.3. TECHNOLOGICAL Figure 2: Computer-aided designing and production facilities Figure 3: Decision support system Developments include comprehensive the scale use of personal computers, the rapid growth of Internet usage, and information technology integration to drive organizations critical processes. The con- vergence of multimedia options of audio, video, and data is providing powerful usage options, further expanding product potential. 1.6.4. ENVIRONMENTAL Factors such as scarce natural resources, concertation of ecosystems through recycling, and re- duced use of paper promote the concept of the paperless age. These trends have a beneficial impact the on the IT industry, replacing paper modes of communication and data processing & storage with electronic

means. Natural disaster as the Asian Tsunami and the series of hurricanes in the US can also adversely affect the organization. 1.7. DEVELOPING STRATEGIES We decide to choose product development because Microsoft still a technological technology com- pany that always develops every year, so the product is not outdated and technological companies always compete to become the most updated company. Microsoft is a big company, so their product already has their own market and people already know about Microsoft, Microsoft no longer needs to put a high effort to make a new product that requires a new market, for example, Xbox products. Since Xbox company is well-known among gamers and sustains a huge market in gaming, Microsoft recognizes products' potential and always makes innovation on them. 2. MARKET SURVEY 2.1. DEMOGRAPHIC Gender 21 22 Male Female Based on the questionnaire result, 22 respondents are male, and the other 21 are female from 43 respond- ents. Age 31 2 37 < 18 18 - 25 26 - 35 > 45 Based on the questionnaire result, 1 respondent is under 18 years old, 37 respondents are 18 – 25 years old, 2 respondents are 26 – 35 years old, and 3 respondents are below 45 years old.

Income Level No income <RM 1000 4 RM 1000 - RM 3000 3 RM 3001 - RM 5000 > RM 5000 5 21 10 Based on the result of the questionnaire, there is no income for 21 respondents, there are 10 respondents that have less than RM 1000 income level, there are 5 respondents that have RM 1000 – RM 3000 income level, there are 3 respondents that have RM 3001 – RM 5000 income level, and there are 4 respondents that have more than RM 5000 income level. Empolyment S tuden t 8 Un employ ed S elf-Emplo yed 2 Employed Full Time 1 32 Based on the result of the questionnaire, 32 respondents are students, 1 respondent is unemployed, 2 re- spondents are self-employed, and 8 respondents are employed full time Which country do you live in? 1 15 27 Malaysia Indonesia Qatar Based on the questionnaire results, 15 respondents are from Malaysia, 27 respondents are from Indonesia, and 1 respondent is from Qatar.

Which residential area do you liv3 e? 16 24 Urban Sub-U rba n Rural Based on the questionnaire's result, 24 respondents are from an urban area, 16 respondents are from a sub-urban area, and 3 respondents are from a rural area. Education level No formal education 2 4 5 Secondary School 1 Dip loma/A- 9 Lev el/Fo undat ion/S TPM/M atr icul at ion Un dergr ad uate degree 22 Based on the questionnaire result, 2 respondents have no formal education, 5 respondents have finished secondary school, 9 respondents have finished Diploma/A-level/ Foundation/ STPM/Matriculation, 22 respondents have completed Undergraduate, 1 respondent have finished a degree, and 4 respondents have completed postgraduate. Do you own a Microsoft Product? 0 43 Yes No Based on the M, questionnaire results, 43 respondents have their own Microsoft product, and no re- spondents who don’t have their own Microsoft product.

2.2. PRODUCT SURVEY How long have you been used Microsoft products? 2 41 >1years 6 month - 1 years Based on the questionnaire result, 2 respondents have been used Microsoft products for 6 months – 1 year and 41 respondents have been used Microsoft products for more than 1 year. How often do you spend buying on Microsoft Product 2 22 19 Monthly Once a year >Once a year Based on the questionnaire result, 2 respondents buy Microsoft products monthly, 19 respondents buy Microsoft products once a year, 22 respondents buy Microsoft products more than once a year.

What is your purchase platform for buyinMicrosoft products? (you can choose more than one) Physical store 1 9 1 10 Direct buying from Microsoft website Uses Product Key + 11 Crack Online store From the laptop itself 21 12 Authorized Microsoft Partner From University's Facilities Based on the result of the questionnaire, 10 respondents buy Microsoft products from a physical store, 11 respondents buy from Microsoft website, 12 respondents use product key + crack, 21 respondents buy Microsoft product from an online store, 10 respondents buy Microsoft products from the laptop itself, 9 respondents buy Microsoft products from authorized Microsoft partner, and 1 respondent buy Microsoft products from University’s facilities. What is the Microsoft products that you normally use? (you may answer more than one) Microsoft Office 46 Personal computer or laptop 35 29 Gaming devices (ex: Xbox) 10 21 Communication platform (ex: 6 Skype, Bing, MSN) Microsoft Windows Personal computer accessories Mobile devices Based on the result of the questionnaire, 35 respondents typically use Microsoft Office, 21 respondents normally use personal computer or laptop from Microsoft, 6 respondents typically use gaming devices from Microsoft, 10 respondents typically use communication platform from Microsoft, 29 respondents normally use Microsoft Windows, 4 respondents normally use personal computer accessories from Microsoft, and 6 respondents normally use mobile devices from Microsoft.

What are the most important features of Microsoft product meet your satisfaction? 31 11 User friendly Low Price 11 Great preformance 2 High Quality Various Functions 7 Single solution product 8 Attractive design Based on the result of the questionnaire, 11 respondents said Microsoft product is friendly, 11 respondents said they have a various function, 8 respondents said that Microsoft has a high quality, 7 respondents said Microsoft are great performance, 3 respondents said Microsoft is single solution product, 2 respondents said Microsoft has a low price, 1 respondent said Microsoft have an attractive design. How much you willing to spend on Microsoft products? 5 <RM100 3 15 RM100 - RM300 RM301 - RM500 >RM500 20 Based on the questionnaire result, 20 respondents spent RM100 - RM300 on Microsoft products, 15 re- spondents spent <RM100, 5 respondents spent>RM500, 3 respondents were pay RM 301 - RM500. What is your first reaction after Neutral using the product? Positive Very Negative 8 Very Positive 12 1 22 Based on questionnaire's result, 22 respondents' first reaction after using Microsoft product is positive, 12 respondents neutral, 8 respondents very positive, 1 respondent very negative.

How well does Microsoft 12 products affect your daily 34 5 life?1 0 10 18 14 (Not well) 1—2—3—4—5 (Very Well) Based on the result of the questionnaire, 18 respondents said Microsoft was very well for daily life, 14 respondents said Microsoft was well for everyday life, 10 respondents said Microsoft was neutral for daily life, 1 respondent said not well for daily life. How well does Microsoft 1 products suits in your daily 2 3 workflow? 4 5 10 6 15 21 (Not Well) 1—2—3—4—5 (Very Well) Based on the result of the questionnaire, 21 respondents said Microsoft was well for daily work- flow, 15 respondents said Microsoft was very well for everyday workflow, 6 respondents said Microsoft was neutral for daily workflow, 1 respondent said Microsoft was not well for daily workflow.

What is the main challenges you have ever experienced from using Microsoft product? 21 Too expensive 3 No any challanges for me 5 No single solution product 4 19 Too Complicated to be operated 3 Short time used product Poor data backup and recovery Outdated product solution Poor design Poor performance 51 Based on the result of the questionnaire, 19 respondents said the main challenges from using Mi- crosoft product is too expensive, 5 respondents said no single solution product, 5 respondents said low data backup and recovery, 4 respondents said short time used product, 3 respondents said too complicated to be operated, 3 respondents said outdated product solution, 2 respondents said poor design, 1 respondent said poor performance, 1 respondent said no any challenges. How would you rate the value of money that you have to spend on the Microsoft product? 4 19 17 Neutral Very Bad 21 Good Excellent Bad Based on the result of the questionnaire, 19 respondents would rate the value of money that they have to spend on the Microsoft product-neutral, 17 respondents said good, 4 respondents said excellent, 2 respondents said bad, 1 respondent said good

In the future what criterias of products you need from Microsoft? 3 2 Affordable product More innovative products 1 3 13 Free version products Multipurpose (one-solution for all) products User-friendly products 5 More features in one product so its easier to use Creative products design 4 12 Based on the result of the questionnaire, 13 respondents said the criteria of product they need from Microsoft is an affordable product, 12 respondents said free version products, 5 respondents said multi- purpose (one-solution for all) products, 4 respondents said more innovative products, 3 respondents said user-friendly products, 3 respondents said creative products design, 2 respondents said faster products, 1 respondent said more features in one product, so it’s easier to use 3. MARKETING MIX: XBOX XBOX is a video game brand established by Microsoft Cooperation. The marketing mix of XBOX includes product, place, price, and promotion. 3.1. PRODUCT Product is defined as an association of goods and services offered by a company to the target market to fulfill the needs and wants of customers. Product from XBOX includes both physical products and services. 3.1.1. PRODUCT CLASSIFICATIONS XBOX products are classified as consumer products. Consumer products are goods and services final consumers purchase for personal consumption. Consumer products include convenience products, shopping products, specialty products, and unsought products. 3.1.1.1. SPECIALITY PRODUCTS Specialty products a type of consumer product with exclusive qualities or brand identification for a significant group of potential customers willing to put a special purchase effort. Considered as specialty products, XBOX had a little comparison of brands and low-price sensitivity as the buyers will willing to purchase and pay more for the XBOX products based on their financial ability as long as the products can satisfied them. The price of XBOX products is high, between RM 1 000 to RM 4 000. XBOX products had also provided exclusive distribution in certain outlets per market area,, such as shopping mall and authentically distributor websites.

3.1.2. PRODUCT ATTRIBUTE Product attributes the features that the product will offer in terms of noticeable or unnoticeable. Product attribute includes product quality, product features, and product style and design. 3.1.2.1. PRODUCT QUALITY Product quality is the capability of a product to perform in its functions and compete among com- petitors in the perspective of durability, reliability, precision, ease of operation, and repair. XBOX video games console pays attention toto the product quality in delivering video games console that enables gamers to enjoy gaming experience through high video resolution, 720p, 1080p, and 1440p (XBOX Series S and X ). 3.1.2.2. PRODUCT FEATURES Product features are a competitive tool for differentiating the company’s product from competitors’ products by developing higher-level models. XBOX tends to differentiate their products from their com- petitors, such as Sony Entertainment that introduced PSP, PSV, PlayStation, PS2, PS3, PS4, and PS5 in the customer's minds by introduced XBOX video games console that have features that support Windows PC hardware that enable gamers and developers to build and run their games in PC besides playing audio CD and DVD unlike video games console by Sony Entertainment that built-in customize hardware solutions. 3.1.3. BRANDING Branding is defined as a combination of name, term, sign, symbol, and design that purposed to recognize goods or services of one or a group of sellers and differentiate them from their competitors. Branding is essential to increase product value. XBOX using the logo in their products with the words “XBOX” and a round shape on the left of the word “XBOX” and at the same time, there is a “X” inside the round shape. Logo of XBOX from 1999 – 2021 3.1.4. PACKAGING The packaging is an idea of device and create a container or wrapper for a product. Besides contain- ing and protecting the product, packaging also plays a critical role in attracting potential customers and

improving customers' points of view through beautiful and practical packaging. XBOX package their XBOX video games console in an attractive hardcover box in order to protect their products from any physical damaging and dust during the time display and transportation. The colors for packaging the XBOX video games console are green, white, black. Brand Features Age re- striction Instruction Producer Figure 3: Xbox Packaging 3.1.5. PRODUCT LINE Product line described as a team of closely associated products due to their similar function, deliv- ered to same customer groups, marketed through the identical types of outlet or fall within given price ranges. Console Games Services Software Controllers

Xbox Video Games Xbox Live Xbox Family Set- Xbox Controller Xbox 360 Xbox One Network Games Xbox Games tings App Xbox 360 Con- Xbox Series X and S Store (Xbox Live troller Marketplace) Xbox 360 Kinect Xbox Smart- Xbox One Ki- Glass nect Xbox Game Pass Xbox Series X Cloud Gaming and S Controller Content filter Table 3: Product line 3.1.6. PRODUCT LIFE CYCLE (PLC) Product Life Cycle (PLC) is described as the course of a product’s sales and profits over its lifetime. The product life cycle, product life cycle consists of 6 steps: research and development, introduction, growth maturity, saturation, and decline stage. PLC Stage Product Characteristics Research and De- Xbox games: Resident Evil ●Gameplay and new trailer are launched to attract more potential customers velopment Village for Xbox Series X ●No profit as the product is currently in development Introduction Xbox Family Settings App ●Products are frequently modified to ful- Xbox Series S and X fill customers satisfaction and require- Xbox Cloud Gaming ment ●Slow sales growth ●A huge amount of expenses required to distribute and launch promotion to at- tract potential customers and increase awareness among the market regarding the existence of the products through social media, fairs, and exhibition

Growth Xbox Game Pass ●Sales increasing from year to year Maturity ●Profits increase Saturation Xbox One, Series X, S Sys- ●Wider distribution in handhelds and Decline tem Software mobile phone ●Increasing in research and development ●Continuously improve and add new features and performance Xbox Live ●Brand awareness, customer service, and differentiation in features required to maintain the product in the market ●Many competitors Xbox ●Price is stabilized at lowest Xbox 360 ●Microsoft company decides to eliminate Xbox One Xbox X the product due to issues: Xbox One S ●Technical problems Xbox 360 SmartGlass ●Rising of new technologies on a video games console Table 4: Xbox Life Cycle 3.2. PROMOTION Promotion in the marketing mix includes advertising, public relations, and sales strategy. The pur- pose of promoting is to show consumers why they need the promoted product and why they should pay the certain price of the product to purchase them. By taking Microsoft Xbox 360 sales as an example, it can be seen that Microsoft conducted a multi- tude of promotional activities. Most Xbox advertisements are done through their websites which could be easily accessed by their players worldwide. Besides that, they also broadcasted globally several advertise- ments globally, leading to their product being widely known. The Xbox 360 was launched on MTV and then at the Electronic Entertainment Expo (E3) with fully detailed information about their product. This approach resulted in that their product successfully sold out upon release. Microsoft also uses other mar- keting strategies such as advertisements on magazines and banners, and they even do an online contest on their website with exciting rewards for their customers. Next, the Xbox logo itself is one of the promotional marketing strategies. The logo is very distinctive and never changing, which created a stronger brand recall. Not only that, but Xbox 360 also offered several online games that can be played by various individuals

across the world, leading to a word of mouth marketing. All these promotional efforts helped keep Xbox sales going. This has concluded the whole Xbox marketing mix. 3.3. PLACE Every company needs to maximize its potential sales to increase sales for the company itself. In this marketing mix, the place is defined as a distribution channel that refers to the location where a product is available and purchased through the online store or physical store. 3.3.1. ONLINE STORE The online store is where buyers and sellers meet virtually, so they make transactions online. At first, people don’t like the idea of the online store because they can’t see the product in real life but only the picture of i. Still, as time goes by, some people don’t have time anymore to go to the shopping mall to buy things they want or need, and nowadays people tend to become lazy to go to the store and buy some products. This opportunity is taken by Xbox company to market their products through the virtual or online store Xbox company makes its website to sell its software products that XBOX players need when they want to play a game with it. With regular traffic on its pages, Xbox company has a large number of online sales. The company make a cooperation with e-commerce or another online store such as Flipchart and Amazon, not only collaborate with another online store the corporation establishes a collaboration with several delivery service providers to provide timely deliveries to operate its online operations, so when the XBOX company has an enor- mous amount of buyer that buy a new product of it, the time taken from the corporation to the client won’t take too much time. 3.3.2. PHYSICAL STORE Physical store is a traditional shopping method where buyers and sellers meet in real life, or they meet face to face even though it’s a conventional method of shopping, people still trust this method to buy products because they can feel the unique experience when shopping in the physical store and physical store can assist customers in decision making so there’s no regret in the future. Xbox products over 500 retailers around the nation have their goods available. It follows an aggres- sive marketing strategy where it aims to provide as many retailers as possible with its products. This means that its goods in various parts of the world are readily available to customers. Not only retailers 3.4. PRICE Price is the amount of money charged for a product or service. It is the sum of all the values that consumers give up to gain the benefits of having or using a product or service.

3.4.1. FACTORS AFFECT PRICE DECISIONS Price decision is a company or firm should consider all the cost include fixed and variable cost to produce the product. However, there are other internal and external factor affect the price decision. 3.4.1.1. INTERNAL Microsoft uses a marketing mix strategy to promote their Xbox in the market. Price is not only a tools Microsoft use, the s to market their Xbox but also coordinated with place, promotion, and product. It can help to market their Xbox effectively. 3.4.1.2. EXTERNAL Microsoft use competition strategies and prices for price decision. Competition is one of the im- portant factors for price determination. Microsoft considers the price, value, and strength of competitors for price decisions. 3.4.2. PRICE STRATEGIES Microsoft uses a various pricing strategies such as cost-based pricing, customer value-based pricing, competition-based pricing, and more. Microsoft uses competition based-pricing for Xbox. Microsoft and Sony compete with each other to try to keep their brand which is Xbox and PlayStation, in the market. They advertise their product to stand out in quality and features. Microsoft strategized to release its Xbox 360 in 2005, earlier before the PlayStation 3, which is released in 2006. The Xbox 360 old model was sold at varying prices from RM 1212.86- RM 1940.60, depending on the internal memory size and variant. Along with price Microsoft always improve the quality and features of the product. For example, Xbox series S and Xbox Series X ,are more powerful and features than Xbox 360, which is released in November 2020 in the US. 3.4.3. NEW PRODUCT PRICING STRATEGIES Microsoft uses market-skimming pricing for Xbox. Price skimming is a pricing strategy in which a firm charges a high initial price and then gradually lowers the price to attract customers. Microsoft set Xbox 360 price less than the cost of making it. The Xbox One was priced higher than the PS4 when it was first released. Microsoft products often start at a high price and continue to decrease until the company finds the best price for the market. 3.4.4. PRODUCT MIX PRICING STRATEGIES Product bundle pricing occurs when two or more products and services are combined and priced together. Microsoft uses bundle pricing strategies for Xbox, which combines 19 games include Halo and Project Gotham Racing. The advantage of bundle pricing is consumers or customers prefer to buy products in the group.

Microsoft uses optional product pricing that sells the base product with low price but sells comple- mentary accessories at is optional product pricing that sells the base product with low price but sells com- plementary accessories at a high price. This strategic use by Microsoft to market their Xbox. 4. EXECUTIVE SUMMARY 4.1. MARKET FACTORS AND TRENDS Our company discovered that culture, marketing, media, technology, and economics would become the major factors in our market trend for the next 10 years. We will start to change our focus from public existence to personal social circles to gain private social trust among customers. Nowadays, tracking and targeting customers become the a challenge due to strict rules and regulations in the country. Hence, we tend to form a friendly platform that allows, us to track and target potential customers different from an advertisement that we did previously. We will combine live streaming services into TV and improve retail search. 4.2. PRODUCT AND SERVICES We’ve launched new services for our customers by introducing Microsoft Advertising Community to ensure marketers have a platform to deliver ideas, ask questions, and obtain information from peers besides provide supports through Microsoft Advertising Specialists. On top of that, we introduced our first wireless earbuds – Surface Earbuds that have 24-hour battery life with high expectation to sustain our place in the market dominated by Apple’s Air Pads. In conjunction with increases the house working, Microsoft introduced new Surface hardware – Surface Go2 and Surface Book 3 as PC usage is increasing and people spend more time at home under the pandemic Covid-19 lockdown. 4.3. CUSTOMER BASED AND MARKETING ACTIVITIES Our target market is large IT companies, including IT shops, manufacturers, resellers, and distribu- tors. We do our marketing campaign through direct sales. We provide our products and services through OEM, which set up our software in their devices before resell; big global enterprises and organizations include public-sector institutions through Enterprise Agreements and Enterprise Services contracts, dis- tributors and resellers, Internet service providers, application developers. 4.4. FINANCIAL PLANNING AND PROJECTIONS We earned USD 1 billion for the next four years in new technologies and innovation in the climate solutions. USD 50 million in AI for Earth to speed up innovation by giving AI in the hands of those working to address sustainability challenges directly. We also offer USD 20 million to invest in digital skills. 4.5. OBJECTIVES AND STRATEGIES In conjunction with the world responding to Covid-19, we will perform our responsibilities to ensure our employees' safety, seeking to protect the health and well-being of communities by operating and provid- ing technology and resources to our customers to help them do their best work while remote.

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