Hard Drives by J. Wallace & J. Erickson, Pages 242-245
The promotional campaign for Word was part of an aggressive sales approach by Rowland Hanson, the newest member of the Microsoft management team. Before he arrived at Microsoft in early 1983, Hanson was vice-president of marketing for Neutrogena Corporation, which made soap and other products. He had also been marketing manager for General Mills. Why not market software like the cosmetics industry marketed soap, he suggested, and provide some free samples? Hanson knew nothing about computers, but he did know a thing or two about soap and marketing.
Gates' decision to bring in an outsider to the computer industry reflected the growing emphasis he placed on marketing. Microsoft was in the midst of it's transition form being a language and operating system company to one selling applications in a retail market. It was not enough just to develop good software--Microsoft had to make customers want to buy it, too.
"If you think about it," said Hanson, "who understands brands better than the cosmetics industry? Look at the halo around Clinique or Neutrogena. These companies are brand dominated. If their brand isn't strong, then nothing else matters, because there isn't reality to cosmetics. Soap is soap."
Word was originally going to be released as Multi-Tool Word, a continuation of the Multi-Tool application product line that was to follow Multiplan. Hanson suggested a different product-naming strategy. It was important for a product to be identified by its brand name, he pointed out. Microsoft had to get its name associated with its products, just like Neutrogena.
Hanson later elaborated of the concept in this way: "If you look back at some of the old articles that were written in the industry, you'll see the word 'Multiplan' but no 'Microsoft' associated with it. That was because Multiplan was a stand-alone name. It started to take on its own meaning, beyond Microsoft, just like WordStar. People who wanted a word processing program knew the name 'WordStar,' but they could not have told you MicroPro was the company that made it."
Hanson wanted to make Microsoft the Sara Lee of the software industry. Everyone knew the Sara Lee brand, regardless of whether they were shopping for apple pie or pound cake.
"The brand is the hero," Hanson said. "People start to associate certain images with the brand, and that becomes much more important than any single product. What the consumer goods companies realized years ago was that the products come and go. You are going to have a product and it's going to rise and fall. But if you can create a halo around a brand name and create equity in a brand, when you introduce new products under that brand halo, it becomes much easier to create synergy, momentum...We decided that we needed to make Microsoft the hero."
Gates immediately saw the logic of Hanson's argument. As a result of Hanson's efforts, the Multi-Tool names were thrown out. Taking their place were Microsoft Word, Microsoft Plan, Microsoft Chart, and Microsoft File.
The strategy worked as Hanson had hoped. Word became known as a Microsoft product. Unfortunately the first version of Word for PC was a fairly mediocre program, and reviews were mixed. Word was widely criticized for being too technical and difficult to learn. Sales, while healthy enough to put Word into the top 100 of best-selling software products on the market, were below expectations.
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