PC or Not PC: Micron Answers the Question with an E
Charting the future of public relations
Holmes Report
CEO

PC or Not PC: Micron Answers the Question with an E

Competitors had written Micron off, while media had authored its obituary. Wall Street was polishing the company’s headstone. Customers and employees lacked inspiration.

Paul Holmes

Like actor Bill Murray in “Groundhog Day,” Micron Electronics, Inc. (MUEI) was having the same bad day … every day.  The Boise-based company was, by all accounts, considered a niche personal computer (PC) manufacturer, whose claim to fame was product reviews.  Perception among key audiences was that the direct-to-customer seller made solid, high-performance beige boxes. 
 
In 1999, the Boise-based vendor ranked in the top 15 in global sales among PC makers; it was in third place among direct-to-customer PC sellers -- far behind Dell Computer Corp. and Gateway, Inc.; it admitted failure in the home PC market and launched an exclusive focus on the business customer segment; and it fell on its face in an initial attempt to lead the PC industry into the Internet services sector.  Consider the following responses to its underwhelming e-services ventures:

  • July 20, 1999: Micron Electronics acquires regional ISP Micron Internet Services (MIS) from parent-company Micron Technology, Inc.  Bob Lewis, columnist with InfoWorld, described the move as “just plain bizarre.”
  • July 6, 1999: Micron Electronics acquires Los Angeles-based HostPro, a Web hosting company.  The announcement falls flat.
  • July 9, 1999: Micron Electronics launches “micronfreeware” -- a half-baked publicity plan to piggy-back onto the technology industry’s “Free PC” fad.  The “Free PC” movement lasted for a New York minute; Micron’s program lasted one month. Smart Reseller’s Steven J. Vaughan-Nichols had the following to say about Micron’s program:  “Free is just too costly for most of us;” and “There’s only one little problem: There’s nothing free about it.”
 
As a result, by August 1999, the high-tech hardware manufacturer was suffering a low-tech, slow-go identity crisis.  Competitors had written it off, while media had authored its obituary.  Wall Street was polishing the company’s headstone.  Customers and employees lacked inspiration.
The Weber Group and Micron Electronics embarked on a 12-month campaign that reversed the negative and limited perceptions of the company’s business strategy; generated significant new sales volume, protecting the company’s investment of more than $210 million; and garnered first-mover advantage in the Web hosting market.
 

PLANNING/Objectives
 

  • Enhance the corporate image by reinventing Micron Electronics as an innovator in e-services.
  • Position Micron executives as visionaries in the “beyond-the-box” e-services arena, particularly Web hosting.
  • Turn skepticism among financial and industry analysts and media into support and enlist them as allies.
  • Drive sales of Micron’s e-services – primarily Web hosting – products and services.
 
PLANNING/Strategic Approach
 

Weber and Micron took a strategic approach to breathe new life into the company’s image, ensuring that the new positioning pulled through all written, spoken and visual communications. To successfully launch Micron’s campaign, TWG had outlined five strategic objects including:
Work closely with advertising to re-brand the corporation as micronpc.com (at the time, “dot-com” valuations were skyrocketing).
 
Introduce and articulate the “Subscription Computing” industry model – a total computing solution that blends the best of the Old World markets with New World technology and pricing schemes.
 
Four pillars of “Subscription Computing”: Web hosting, e-commerce, connectivity, hardware and hardware services.
 
Customer benefits: configure-to-order computing services and solutions, one monthly bill for all services, flexibility (per seat dial-up/dial-down configuration), single point of contact for all computing services.
 
Work closely with investor relations department to establish MUEI’s e-vector:  “Web hosting is a core business.”
 
Leverage CEO’s in-your-face reputation.
 
Reach beyond traditional PC-industry mediums to influencers in the Internet and Web hosting industries.
 
EXECUTION
 
In late 1999 and throughout 2000, Weber and Micronpc.com implemented the following integrated program to ensure flawless execution and extend reach to new and traditional audiences:
 
Integrated Outreach
 
Setting the Table: To ensure clear message pull through in launch coverage, the team conducted a bi-coastal pre-briefing tour with industry analysts and media who covered the PC and Web hosting beats.
Talkin’ ‘Bout a Rev-oo-lu-tionnn: To equip Micron’s 2,400 employees with appropriate messages and turn them into enthusiastic evangelists, the team held an “IT revolution” event at Boise Center for all employees. 
CEO Joel Kocher, draped in a Micronpc.com-branded black leather jacket and perched upon a Harley-Davidson hog, commenced kick-off remarks with, “It’s the revolution … this is the opportunity we have been waiting for to change the world!”
New York, New York: Launch e-services strategy at financial analyst breakfast – again inviting traditional PC industry analysts, as well as Internet and Web hosting market watchers.
Emphasizing Execution.  The team conducted two additional bi-coastal media and analyst tours with e-services media throughout the year.
Step Up to the Podium.  The team implemented a two-tiered, targeted speaker’s program to reach the Web hosting industry targets (sales) and business/financial targets (valuation).  Secured speeches included: Spring Internet World 2000, ASP Forum 2000, SUPERCOMM 2000 and BusinessWeek CEO Forum.
 
EVALUATION
 
Media Results:
Subscription Computing Launch:
Held 25-plus pre-briefings with targeted industry analyst and media.
Posted more than 30 “Day One” media hits with coverage in top-tier daily, weekly and business publications including, USA Today, The Wall Street Journal, Associated Press, Reuters, Bloomberg, Industry Standard, Computerworld, PC Week, Internet Week, Business 2.0, Forbes Digital Tool, C|Net, PC World, Upside, Network World, Business Week, and PC Magazine.
In-studio CEO interviews appeared on Fox TV News: The Cavuto Business Report and CNBC: Power Lunch.
Additional broadcast coverage appeared on CNNfn: Digital Jam, CNNfn, as well as local TV coverage in the state of Idaho.
Ongoing Results: 
Within a 30-day launch period Micron coverage appeared in an additional 25-plus “continuing coverage” articles, bringing the launch window coverage to nearly 60 targeted media placements.
Eight CEO and CWO Q&A profiles regarding Micronpc.com e-services in publications such as Investor’s Business Daily, Interactive Week, Information Week and MC Magazine.
 
Positioning Results
One-third of the day one stories included the word “Subscription” in the headline.
Wall Street Journal -- “Micron Electronics Shifts Sales Strategy to Monthly Computer Subscription Fees”
CNN.com -- “Micron sets new strategy, PC maker to spend $210M on ‘subscriber computing’ initiative”
Industry Standard -- “Subscribing to Your Computer”
21 articles (from October 1999 – May 2000) included the word “hosting” in the headline.
InformationWeek --“Micron Boss Touts Web And Applications Hosting”
 
Business Results
The ongoing e-service campaign enhanced Micron’s reputation and produced a significant boost to sales and revenues, reflecting a much broader and deeper market acceptance.
Micron’s stock price hit a 52-week high -- more than doubling at the peak of the e-services campaign.
Micron customer subscription numbers increased from 17,000 in Q1 2000 to 34,000 in Q2 2000 to 57,000 in Q4 2000.  This growth represented a subscription increase of 235 percent over the year.
Micron’s revenue for its Internet access and Web hosting services grew from $4.1 million in Q1 2000 to $11.4 million in Q4 2000 – a revenue increase of 178 percent.

Article tags
Technology
comments powered by Disqus