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How Kin Became Microsoft's Worst Failure

The Microsoft Kin has now eclipsed Bob and Zune as Microsoft's worst failure, a boner so bad that it's been canceled only six weeks after it was announced. Sales estimates for the Kin range from only 500 devices sold in the first six weeks to "fewer than 10,000" (from the New York Times.) The "fewer" quote sounds like PR weasel-speak, so I'll bet the 500 figure is probably closer to the real number.

That's truly abysmal, when you consider that the Kin was offered through Verizon and there are around 300 Verizon stores scattered throughout the U.S. That's less than 2 units per store on average. No wonder Microsoft gave the product the post-haste axe.

Anyway, the reason I'm posting about the Kin is that it's a perfect example of how the best branding in the world is a complete waste of money if the customer experience (including the sales process) isn't up to snuff.

Kin's brand marketing campaign made perfect sense. Microsoft wanted Kin to seem more plugged into what's happening with young adults (their target market) than the iPhone. They therefore decided to emphasize social networking, both through the name (which points at relationships rather than gadgetry) and throughout the Kin marketing materials.

The tactical execution of this concept bordered on brilliant. The company's ad agency launched a "this is what Kin is all about" video that featured attractive Millennials doing something with their Kins that bluestocking Apple would never tout: the Kin ads pointed out that the Kin would be a great phone for sexting -- the sending of lewd personal pictures to friends via smartphone:

The sexting angle immediately got the baby-boom establishment's shorts in a twist, which should have been fabulous news for the Kin, because this one of those cases where you WANT to get a negative reaction in order to create more buzz. (There's nothing more likely to attract consumer attention than people complaining about sexual content.)

One could quibble about details of the campaign. The campaign could have done without Microsoft marketing's reflexive biz-blab (i.e. "next generation of the social phone" -- bleah!). But the fact remains that the Kin had a fair shot to become the Lady Gaga of the smartphone world. All except for one thing. The customer's experience with the product sucked.

First, the pricing did not match the product. The Kin was offered at $50 and $100, with cell phone contract, but you also had to buy a $30 a month data contract. But the Kin lacked the ability to run apps. Why would anyone pay smartphone prices for a phone that can't run apps?

Second, the product was deficient. If you're going to position a product as a smartphone, it needs to be, uh...., smart. The "smarts" in a smartphone mean the ability to customize it with apps. You'd think the company that invented Windows would get this.

Third, the sales channel wasn't committed. According to the New York Times, Microsoft employees who visited Verizon stores found that the sales reps were recommending Android-based phones and steering customers away from Kin.

In other words, Microsoft had brilliant brand marketing right out of the box, but in the end it didn't mean diddly-squat.

For the sake of argument, suppose Microsoft had offered the Kin, not as a smartphone, but as a regular cell phone with easy-to-use social networking features. And then priced the Kin so that it was free with a 1 year contract, with a certain amount of free data time (they would have had to subsidize Verizon to do this, but Microsoft's got deep pockets.)

Then, rather than posting corporate videos hinting at sexting, Microsoft starts shooting out press releases denying that the Kin phone was intended to be used for sexting, with specific links to YouTube videos showing exactly what people should NOT be doing with the Kin.

The Kins would be flying off the shelves.

Microsoft should have been focusing on product development, partner development, and channel development -- and left the branding to the customers. That's the way it's done nowadays.