Paul Colligan – The People And Business Of New And Social Media

Zune Is Microsoft’s Arch Deluxe … Almost

Posted by Paul Colligan on Thursday, December 14, 2006

Remember the Arch Deluxe?

Mmmmmm…….. Burgers ………

In May of 1996, McDonalds launched the burger everyone loves, the Arch Deluxe.

You don’t remember it? Let me remind you …

McDonalds realized they were doing great with the kiddies, but the more “sophisticated” burger consumers were heading other places.

Numbers don’t lie.

The Golden Arches actually hired Andrew Selbaggio, famous Chicago chef to help them out. He actually said in the process, and I quote, “I want people to realise we are not a factory, we are a restaurant.”

The problem was this … McDonalds is/was/remains a factory. You don’t go to McDonald’s for the food.

McDonalds spent 200 million dollars marketing this flop. And if you go into a McDonald’s today, you couldn’t get an Arche Deluxe, even if you had that 200 million bones.

I once heard it said (but can’t find a single reference online) that they could have purchased one of a dozen or so “high end” fast food chains for that money. Problem with that approach was that, to McDonalds, the brand was more important than the profit – because they thought the profit was in the brand.

And they were wrong.

Mark Cuban ran some very interesting numbers today on how Microsoft might have bought their way into Zune’s space. I disagree that the portable media player space is entirely about the music, but he makes some amazing points. In short, the question is this:

Is turning the IPod/PDA industry upside down worth $575mm a year ?

Could Microsoft have done this whole “our music player” thing different, if they weren’t so worried about making sure it was all about a Microsoft brand?

The Arche Deluxe wasn’t a bad burger. It contained more fat than anything else on the menu, but it wasn’t a bad burger.

It just didn’t make sense to their audience.

The Zune, people, is not a bad player at all. It contains more bloated features than anything else on the menu, but it isn’t a bad player.

It also, simply, doesn’t “fit” the market they are trying to sell it in. Either change the market, or change the player.

People who wanted a “better burger” were going to some place other than McDonalds – because that’s where you go when you want a better burger.

Microsoft tried to launch this sophisticated player (that ‘squirts’), all about the social, that could be tied into the branding of some very hip branding MBAs. The problem was they weren’t thinking about the end user, or the stockholder, or their previous partners (ask any “Plays for Sure” partner what they’re thinking about these days), or anything else important. They were trying to prove a point that, simply, didn’t need to be made.

Just like McDonalds and the Arch Deluxe.

Now, my title for this post ends with “Almost.”

The Zune is a far better media player than the Arch Deluxe was a burger. The interface is gorgeous and it beats the usability (the player, not the desktop software) of any other player than the iPod. If you just tweaked a few things, it could easily become a staple, a standard on the Microsoft menu. Right there on the board between Windows Mobile Phones and the Xbox, you could see the Zune, if they simply change a couple of things.

But this is more than a “add cool stuff in version 2″ kinda thing. You need some major tweaks on the core of this product, the approach, the marketing, etc.

How hard would these tweaks be? Not that hard at all – honestly. Zune is actually much easier to salvage than the Arch Deluxe. Simply read the blogosphere (the constructive part, not the token “Microsoft Sucks” blogs), and you’ll get a plan worth far more than whatever you paid the team who launched Zune.

The question is, will they make these tweaks so that the Zune “stays on the board” – or will Zune go the way of the Arch Deluxe?

Thoughts?

Technorati Tags: zune, ipod, mark cuban, microsoft, mcdonalds, arch deluxe