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Consumers Reluctant to Switch to Vista

Harris Interactive has recently released a study of US consumers' intentions about purchasing Microsoft's new operating system, Windows Vista. Last December the number saying that they would wait till upgrading was 31 percent, however the latest figures in March have more than doubled to 67 percent.

The Harris Interactive poll asked consumers about their intention to upgrade or switch their primary home PC to Windows Vista within the next 12 months. Of those surveyed 60 percent of the 2 223 adults said Vista would have no impact on when they would make their next PC purchase.

Reluctant to make the switch to Vista

Before Vista's consumer launch in late January, the number of people aware of Vista was a mere 47 percent of those surveyed, compared with 87 percent post-launch. This indicated Microsoft's marketing had been very effective in raising Vista awareness, however sales remained low.

Milton Ellis, vice president of Harris Interactive Technology Group, said in a statement, "In order to generate that 'Wow' factor, Microsoft will have to put forth a value proposition that will move the majority to the upgrade category in the years ahead. Vista promised better performance, reliability, security and a revolutionary user interface-but it appears consumers looking to upgrade are not ready to buy into the promise, whereas new computer buyers will want the latest and greatest."

Microsoft's marketing problems with Vista occur as a result of people buying differently in an established market than a growth market, and also as a result of Microsoft finally meeting a worthy competitor: itself.

For most people, Windows XP is going to be good enough. Windows XP is a great product, supported by lots of applications and hardware. Web 2.0 has provided new ways for consumers to extend the value of XP, without having to jump to Vista and without the hassles associated with switching.

The maturity of the PC market and Windows XP have both contributed to the dismal sales figures of Vista. While Vista is easier and more pleasant to use, the operating system isn't exceptionally better, like it's touted to be.

Whenever a new product enters the market to displace an existing product, it must offer a significantly better experience. DVDs rapidly replaced VHS tapes because the experience for consumers was so much better, in terms of picture quality, durability, navigability and usability. HDTV and big-screen TV sales are also high for similar reasons. In contrast, high-definition DVDs are better than standard DVDs, but are not significantly better, which has led to their slow uptake. Similarly, Vista is also undergoing a slow transition, since somewhat better is not good enough.

With increasing Vista product awareness, it's a bad sign that the number of people "not sure" about upgrading diminishes and the number planning to stick with what they've got dramatically increases. The goal of marketing is to increase awareness so that people will buy the product, not choose to stay with what they have.

Vista's increased awareness and decreased intention to upgrade is a reflection of Microsoft's poor marketing efforts. The fact that more consumers are choosing to stick with Windows XP means that the more people learn about Vista the less interested they are in it. Either it's a marketing problem or something more fundamental.

Unfortunately for Microsoft and its partners, the latter reason may emerge as the main reason. Given that Microsoft is competing against its own very good product and most people already have PCs, Vista needs to be more appealing than Windows XP and the user benefits have to be made crystal clear.

Microsoft has instead increased complexity by introducing confusing new versions, adding features like UAC (User Account Control), and requiring extensive hardware or software application updates. The depth of the problem is also illustrated by the confusion over Windows Vista Capable and Windows Vista Ready. Another hurdle for consumers is actually purchasing Vista. Consumers must choose from four versions: Business, Home, Premium and Ultimate. This increased complexity risks making Windows Vista less appealing than Windows XP.

Even though consumers may not be rushing out to purchase Vista, the operating system will no doubt succeed eventually, simply because Microsoft holds a monopoly. However, it is in best interests of Microsoft and its partners that Vista succeed sooner. In order to fulfil this Microsoft must provide consumers with much better and clearer reasons to switch to Vista. Only time will tell if marketing is enough to fix this problem and turn Vista awareness into consumer sales.