Zune 2.0, High Visibility in Sears and Wal-Mart Not Enough

By Richard Menta 1/18/07

The last couple of days I found large endcaps for the Microsoft Zune portable player in two of Americas largest retail chains. I smacked into the first one with my shopping cart on Sunday at Sears, because my attention was diverted by a large plasma set. There were two Zune players on this very visible and strategically placed endcap surrounded by several Microsoft accessories for the player.

Then today at Wal-Mart I saw another Zune endcap. This one had three Zune players in each of the three available colors and the endcap was just as large and visible as the one displaying the entire iPod line. The visibility of the Zune also dominated all the other DAP makes sold at the store from Archos to SanDisk. Such visibility usually breeds success.

SanDisk Sansa Shaker is available on Amazon

So tell me, with such ideal product placement how come the Zune portable is such a marginal competitor in the DAP arena?

It certainly isn't because Microsoft is not spending money, such endcap placement is pretty expensive. The Zune also had a huge buzz going in the weeks prior to its deployment, with plenty of press and advertising. Unfortunately, the returns for such a significant effort were poor. Sure, the digitally savvy have disected and evaluated the virtues and faults of the Zune ad nauseum, but the average Wal-Mart shopper hardly falls into this group. Normally, endcap placement works quite well at attracting the average consumer. We could blame it on the iPod's aura, but in a more modest display at Wal-Mart was the second best selling player line, the SanDisk Sansa. The Sansa's sales numbers may be dwarfed by the iPod's, but they are still pretty good and well ahead of the Zune's. It's telling that SanDisk has found success with a marketing budget much smaller than either Microsoft's or Apple's.

So what really is the root of Zune 1.0's flat reception? All I can think of is good old word-of-mouth, a concept that has grown with importance as the Internet has grown in influence. Word-of-mouth on Apple and SanDisk products are mostly very good. Word-of-mouth on the Zune is mostly mediocre.

If Zune 2.0 is to succeed it better be damn compelling, because just throwing money into a marketing machine is obviously not enough. Make it compelling and solid word-of-mouth will follow. The introduction of a 16GB flash unit would be compelling. Considerable loosening of the WiFi restrictions placed on Zune 1.0 would also help. In the end, the next Zune must become much better at serving the desires of the consumer as opposed to the strategically confused whims of the record industry. You don't have to be a student at Warton to figure that one out.

Maybe Microsoft will do things better the next time around, both in designing and marketing their player. As for Zune 1.0 it looks like that unit will only find success in another visible endcap at these stores - the $50 clearance bin.

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The Wi-Fi Sansa Connect is available on Amazon

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