Palm Ad Campaign Positions It as OS Supplier

Later this week, Palm Inc. will begin a $100 million advertising campaign whose goal, in addition to raising the awareness of Palm among non-digerati, is to position the company as the creator of the Palm OS and not as a hardware company.

The ads, which will appear on TV, radio, magazines, newspapers and the Internet, will showcase the Palm OS and the many applications it can run. They will feature shots of Palm apps in front of people and landscapes without any Palm hardware appearing at all. "We're repositioning ourselves as the leading mobile platform provider," said Satjiv Chahil, Palm's chief marketing officer.

Attendees at last week's Internet World got a preview of this campaign. Palm's booth was decorated with pictures of faces with Palm apps superimposed on them.

Currently, Palm gets about 90% of its revenue from hardware sales but in their last Annual Report said they expect licensing fees from such companies as Handspring to become more and more important to the bottom line.

The campaign also reaches out to people who aren't typical Palm buyers. They will appear in Vogue and O, the Oprah Magazine and other fashion and sports magazines. Liz Brooking, Palm's senior director of marketing communications, said, "We want to go beyond the affluent male demographic to reach a broader audience."

Do you think this is the best advertising strategy for Palm? Please give us your comments below.

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on the right track...

GregGaub @ 11/1/2000 11:40:08 AM #
I think their new strategy is a good one. Palm's have become more and more a tool for the ever-person. That is their market, plain and *simple*. By expanding that market, they help ensure their continuance in it. There's almost no way the PPC could take this same market. People in general have a hard enough time with desktop computers, the last thing they want or need is a pocket computer that's just as much of a pain (or more - YES, I HAVE A PPC!). Sure, the affluent white males of the world will probably continue to want bigger, better, faster pocket computers, but that's not as big of a market as people on these sites seem to think. In fact, it's relatively small compared to the millions of "normal" people who could find value in a simple computer that does what THEY need it to do, and do it reliably. Those people don't want to mess with checking their computer's processor to download the right version of software that only sort-of does what they need.
Anyway... rant mode off...
This is what I figured Palm would end up doing anyway, what with all the licensing they are doing with the OS.

-Greg

Put money into development, not advertising

I.M. Anonymous @ 11/1/2000 1:23:07 PM #
Personally, I think this is a waste of good capitol. Palm should put more money into extending the capabilities and functionality of the PalmOS, instead of ad campaigns. If they spent this advertising money on development, they wouldn't need to advertise so heavily to promote the Palm platform.

Where are the exciting new products? From what I've been reading, the biggest innovations from Palm and its licensees won't take place for another two years! What's going on here?

RE: Put money into development, not advertising
silfreed @ 11/1/2000 2:06:20 PM #
I would have to agree. I've owned a Palm IIIx for two years now, when I had the decision between a Palm V and mine. I decided for the 3 series b/c of it had more ram (wow, two megs extra!) and more support.
Now, two years later, I'm looking for something with more. I want multimedia support. I want to record voice memos. I want color. And I want enough ram to actually do something.

Where can I find that now? In a Compaq iPaq. And it seems inevitable that I will get one. Why? Because it has terrific application support? No. Because it is rock stable? No. Because it is faster with more features? Yes. I love my Palm, and if there was any way around it, I would buy another. But, I'll probably have to wait two or three years to get the features that are NOW available in a PPC.

I'm tired of Palm and Handspring nickle and dimeing us with 'oooo! 8 Megs of ram!', or 'oooo! 16 bit color!'. They need some real advances, or they're going to give up their market.

RE: Put money into development, not advertising
I.M. Anonymous @ 11/1/2000 2:26:09 PM #
I had the same feeling when looking at the Sony Clie'. What is the point of this thing? It offers nothing that you can't get in a Palm IIIxe, except for another memory format we DONT need. And it costs $400. I'm really feeling lost right now. I don't see where this platform is heading, and I don't think Palm knows either. They seem to sticking to what they've done over the past 5 years, but I don't think they can survive that way.

Handspring really isn't much better. All they have done is offer a Palm clone with a proprietary expansion format that uses modules that cost more than the base unit itself. The MP3 players cost nearly $300. Yatch!

As for the iPAQ/Pocket PC...I'll wait for the prices to come down a little bit before I would consider getting one. But I don't see how I will be able to resist getting one if we don't see anything radically new from Palm or its partners next year.

RE: Put money into development, not advertising
Lucky Dragon @ 11/1/2000 4:08:32 PM #
Palm has to consider not only what you "power users" want, but what most consumers (most of whom
aren't electronics enthusiasts) think is important. Thus a PDA with all the latest bells and whistles
that costs $400-$500 is going to seem like a colossal waste of money to a businessperson who just
wants something to replace their paper scheduler. If you want to play MP3s and watch movies on
your PDA, go buy an iPAQ and quit whining about Palm's lack of support for those activities. But no-one
who just needs an organizer (90% of Pam's target market sector) is going be able to justify buying a
PDA that costs more than your average stereo system or DVD player. By the time the price of the
color screens and fast mobile processors drops enough to make them attractive to the average consumer,
I think you'll discover that Palm has caught up with the PocketPC crowd in terms of power and multimedia
features.
I gave a Palm IIIx to my mother for her birthday last year, and she doesn't care that it has a B/W display
and only 4 Mb of RAM or a processor that's not state-of-the-art. She's just delighted not to have to carry
a paper address book and organizer around whereever she goes. The Palm weighs less, is smaller and has
enough memory to store her addresses, appointments and the entire NKJV version of the Bible with plenty
of space left over. She'll probably be using it for the next 4 years or so, if it lasts that long and never
even consider using it to play MP3s or watch video.
Criticizing a Palm for it's lack of multimedia features is like comparing a car to a plane and criticizing the car
because it can't fly. Cars aren't designed for the enthusiast but for the consumer, so they're mass-produced
and incorporate only those features that the vast majoity of people will need in order to keep the cost down,
while airlplanes are much more expensive and more difficult to use safely, but offer features unavailable in a
more economical mode of transportation.


RE: Put money into development, not advertising
pneutin @ 11/1/2000 5:02:41 PM #
couldn't have said it better

RE: Put money into development, not advertising
I.M. Anonymous @ 11/1/2000 8:50:57 PM #
Um, no. That would be the deathknoll of the Palm. Good marketing will increase revenue and increase number of Palm owners; increased revenue means faster development and cooler technology. Increased number of Palm owners means independent software developers will have a larger market and increased incentive to create and upgrade their software. Everyone wins.

I could list all of the failed technology products that I really enjoyed using which failed because they weren't marketed correctly, but I won't because it would probably fill the server up.

So here's a few:

Amiga, OS/2, GeoWorks for PC, DR-DOS, DesQview, 3DO, and once at near-death, Macintosh.

Today, I sit on a Windows PC because Commodore, IBM, and GeoWorks didn't put enough effort into marketing their superior technology. So the average, uninformed consumer (those would be people who don't read websites like this one, for example), used Windows because they thought it was the only thing or the best thing out there.

It's sad but true: people only buy the stuff that's most heavily promoted, regardless of whether or not it's the best product available. (another example: do you _really_ think people listen to Britney Spears or the Backstreet Boys because they're great musicians?) No one researches technology purchases unless you're in the technology field, and it's naive to expect that people are going to start now. Think _broad market_: Palms should be as ubiquitous as wallets are, and the only way they'll get there is with great marketing.

I really enjoy using my Palm; it's the first computer since Amiga that I actually enjoy using. I'd hate to see it disappear for the same reason that Amiga, OS/2, and GeoWorks did: poor marketing.

I don't think they could spend enough money on marketing, in fact. Marketing gets people to use your product, and having lots of people use your product gives you money. It's pretty hard to go out of business or run out of development funds when a zillion people use your stuff.

So, kudos to Palm for having the foresight to increase the longitivity of the platform with a solid marketing plan that will increase revenue so Palm can keep developing new products or develop them faster. It's great to see them avoid the mistake that has killed 'technologically superior' platforms like Amiga, OS/2, and GeoWorks in the past.

RE: Put money into development, not advertising
I.M. Anonymous @ 11/2/2000 9:33:12 AM #
and that's why YOU don't run a successful, multi-billion dollar corporation.

Think about it. You have a big pile of money. and a smaller pile of money is given to you every month. If you spend money on development, then sure, you end up with a better product but your BIG pile has become much smaller and the small piles coming in every month aren't enough to keep the BIG pile from getting smaller!

INSTEAD, spend money from the BIG pile to market and attract MANY more consumers. The monthly small piles become larger piles to the point where you can now spend money on development but your original BIG pile isn't getting smaller!

GEEZ! it's common business logic. get it? Sorry to all for the 'simple' example but some people obviously haven't studied anything more complex than running a sidewalk lemon-aid stand.

Micorsoft is HUGE! Let's get Palm up there before we start criticizing Palm for not producing or behaving like Microsoft (which i'm SURE glad they aren't....i'm a stockholder too.)

As a Palm owner and a stockholder...

reidjazz @ 11/1/2000 5:28:01 PM #
...I would have to echo similar comments made here. Palm needs to get moving *NOW* (read: NOW) on delivering on more than just the "simple" approach to handhelds. Yes, I agree that for most users, the simplicity is what drew them to a Palm Pilot (and believe me, I really love my IIIx--it helps me keep my life organized!). But there is an ever-growing group of us that have a need for more than just 8 megs of RAM and the dim monochrome or even color display currently offered on Palm devices (and if you've ever seen the display on an iPaq, you know what I mean). Palm, it's time to move forward with something truly innovative, that meets the needs of ALL of your user base. Here's hoping that I can continue to be a Palm loyalist, in good conscience.

Nice

Tony Lucero @ 11/1/2000 7:11:01 PM #
It seems like a good idea. I know that my confidince with Palm goes up knowing that they supply the OS for even big names such as Sony.

What a joke

I.M. Anonymous @ 11/1/2000 8:49:01 PM #
Palm better hope Microsoft doesn't do an ad comparing Pocket PC applications to Palm applications or this ad campaign is going to blow up in their face. This is just further evidence to me that Palm has nothing up their sleeve.

RE: What a joke
I.M. Anonymous @ 11/2/2000 12:40:04 AM #
You people are nuts.

A: The whole reason Palm is awesome is because it gives people like you and me the ability to deveelop and share sortware - and it provides the OS. If they had a team of lets say 20 developers, would that limit the software output? Instad there are tens of thousands of people who have access to all the tools and software they need.

B: They need advertising. They need people to know that the Palm isn't an exspensive caculator & address book.
-Seething Hebrew, NYC

RE: What a joke
I.M. Anonymous @ 11/2/2000 12:40:04 AM #
You people are nuts.

A: The whole reason Palm is awesome is because it gives people like you and me the ability to deveelop and share software - and it provides the OS. If they had a team of lets say 20 developers, wouldn't that limit the software output? Instead there are tens of thousands of people who have access to all the tools and software they need to develop and customize their Palms.

B: They need advertising. They need people to know that the Palm isn't an exspensive caculator & address book.
-Seething Hebrew, NYC

Now that's pretty funny...
I.M. Anonymous @ 11/2/2000 2:24:43 AM #
That is in fact what the whole purpose of the Palm OS was originally designed for. To be a calculator, address and todo book. Just like in the early 80's DOS was simple and very useful, so was the Palm OS 5 years ago..But today.. their vision is limited.. I admit that the ad compaign is a good idea to get public awareness, but Microsoft can easily do the same thing with out even a dent to their budget.I like Palm..and after reading the many posts above, I can even agree to much of the "simplicity" approach Palm is taking (even thought I personally dont like it). But you have to admit it would be nice to have the "option" to go beyond 8 megs of memory, and even something as dumb as a built in voice recorder would be nice, for those users who truly live and die by the Palm and are the power users of Palm. I don't know about anyone else, but I see that more practicaly then sticking this OS in a car as palm is planning to do.

Great news. Now your sister will understand too...

Cutting Crew 2 @ 11/1/2000 10:34:23 PM #
A number of the posters here have seen the same blaze of light I did when I read of the advertising plan. Excellent! Marketing drives awareness, preference, and ultimately, traffic & sales. With the spate of MS advertising attempting to put down Palm, a solidly positive, nondefensive campaign will reassert their positioning in the mind of the "every-person" out there.

The many Palm developers will be thrilled with this: after all, Palm has not done much to acknowledge that the Palm is more than a "connected organizer" up to now. The "Visor is ..." campaign from Handspring is in this same vein--stressing the flexibility of the system in addition to the solid foundation of ease-of-use.

Now, if Handango and PalmGear could get their software search and sort systems figured out so that looking for a reasonable app didn't induce eerie recollections of lycos searches from 4 years ago...

I think creation of a consumer brand is exactly what is needed next. The word of mouth has already carried Palm deep into the culture (Dilbert, Letterman, etc.) so that the populace is primed to receive a message relaying the "brand promise" of Palm. Based on Palm's 2 billion dollar annual sales run rate expected inthis quarter, 100 million is a reasonable figure, too. There is still plenty of money to spend on Palm@Palm research, development tools improvement, and platform support services like the new Developer's Nation program.

I look forward to the future.

Whatever...

Eston @ 11/2/2000 6:33:04 AM #
Okay, bad fiscal move. 90 percent is based on the hardware. here's the models we all want to see:

Palm IIIr - a palm with a reflective color LCD like the game boy color.
Palm Vc - palm vx with a IIIc's screen.
Palm VIIc - a vii with a color screen
Palm X - a Palm with MP3 audio, voice recording, a 320x240 color 16-bit screen, a headphone jack, wireless internet capabilities, and a compact-flash slot like the PPC.

When will Palm realize that Microsoft's PPC threat to their economy is large? Time to step away from obscurity, Palm. You need to be able to have your OS support the budget-minded users as well as the power users. I had an HP Jornada 548 and got rid of it for this Vx because Palm was on the rise. Maybe Microsoft's PPC is the evil empire to Palm, but it is eye candy compared to what's up now. Try new hardware, Palm. Not your OS.

RE: Whatever...
I.M. Anonymous @ 11/2/2000 5:49:07 PM #
People don't seem to understand that Palm is actually 3 seperate entities!

Palm Device - these guys make hardware and LICENSE the OS from Palm Platform (below)
Palm Platform - these guys own the OS and the software and LICENSE it to multiple LICENSEES such as Palm Device, Handspring, Sony, Nokia, Motorola, Symbol etc
Palm.net - these guys own the Palm.net service, and everything that revolves around it

So the advertising is specifically the Palm Platform guys getting some limelight - 'bout time too. People need to realise that Palm are more than just hardware - and that it's the software that actually makes it all tick!

Good move guys - I applaud it, as both a Palm device owner (multiple licensees), and as a Palm stock holder.



IdeaAdvisor.com's Opinion

Ed @ 11/2/2000 11:55:35 AM #
Here's an editorial about Palm's ad campaign in Read Audio format:
http://biz.yahoo.com/oo/001101/43228.html
Basically, the writer thinks Palm is a bit premature with this move, considering that licensing accounts for only 10% of their revenue.

I disagree but the editorial is interesting.

---
Plenipotentiary
Palm Infocenter

Nope, wrong move.

I.M. Anonymous @ 11/2/2000 3:42:08 PM #
If palm wants more users to use their products, they should focus on product / software development. People shouldn't need to be convinced by advertisments, they should be convinced from seeing other people using their products. Bottom line - if they have a good product - people will use it.

RE: Nope, wrong move.
pneutin @ 11/2/2000 5:40:00 PM #
i think that is a very naive view because as of now, (i'm not sure if this is true of all locations, but it certainly is true for where i live), only "technogeeks" have a Palm or other PDA and use it in public where others can see. Of course the average non-technogeek consumer will assume it's just another technogeek gadget that will not interest nor benefit them in the slightest way. But if Palm embarks on this ad campaign and proves to the average consumer that they don't have to be a technogeek to find a Palm PDA useful, then they too will go out and purchase a Palm, then tell their friends about it, and blah blah. So you see it's not so simple as having a good product means big sales. You have to convince a consumer that your product is indeed good and is right for them.

palm now-pocket pc later

Dirk Bliss @ 11/2/2000 6:23:31 PM #
I replaced my paper organizer 6 months ago with a palm IIIxe. The palm did what I needed for $250. At the time, Pocket PC's cost twice as much and Microsoft had a bad rep regarding WinCE. If I needed to replace my Palm tomorrow, I'd probably buy an IPAQ. They're beautiful, fast, and more capable than my trusty Palm. Palm has to catch up if they want my business a second time.

Who cares

~What~ @ 11/3/2000 8:51:51 AM #
What is the problem. Palm has the best OS. Why wouldn't they advertise that fact.

Money is not the issue

I.M. Anonymous @ 11/3/2000 7:10:53 PM #
A lot of posts have focused on the $100 million figure, saying it is a bad fiscal move.

Don't forget that Palm has a huge war chest from it's IPO -- 900+ million dollars!

This ad campaign will barely dent it. More ads means more sales, more sales means more developers, more developers means more applications, more applications means more sales...you get the idea...

RE: Money is not the issue
I.M. Anonymous @ 11/3/2000 11:07:41 PM #
Unfortunately the ad campaign will be useless. Everyone knows what a freaking palm pilot can do. Wow. Lets show people using one. WHO HASN'T SEEN SOMEONE USING A PALM DEVICE?

That Chahill guy drove apple into the ground and left right before they made a comeback, coincidence, I think not. He was director of marketing and made MORONIC commercials that made most people go: what the hell would I want a mac for? They emphasized ZERO of the reasons why anyone would want to buy a mac and he'll do the same dynamic job for the palm platform.

I'd say the number one reason that palm is making any money right now is that the devices are so fragile that people go through them quickly and have to buy another. Most people I know buy 1 palm a year as opposed to a computer which is more like 1 every 2 or 3 years because palm screens break so easily.

If there's any money to be made by advertising, it would be by Compaq who makes such an amazing iPaq handheld that makes even a color palm look silly. Of course the demand for the ipaq is so high right now that ads would only make the backorders longer...

Palm needs LESS ads and MORE development. If they're going to bet the company on the os, they're going to LOSE eventually unless they do something real soon.


RE: Money is not the issue
I.M. Anonymous @ 11/3/2000 11:07:41 PM #
Unfortunately the ad campaign will be useless. Everyone knows what a freaking palm pilot can do. Wow. Lets show people using one. WHO HASN'T SEEN SOMEONE USING A PALM DEVICE?

That Chahill guy drove apple into the ground and left right before they made a comeback, coincidence, I think not. He was director of marketing and made MORONIC commercials that made most people go: what the hell would I want a mac for? They emphasized ZERO of the reasons why anyone would want to buy a mac and he'll do the same dynamic job for the palm platform.

I'd say the number one reason that palm is making any money right now is that the devices are so fragile that people go through them quickly and have to buy another. Most people I know buy 1 palm a year as opposed to a computer which is more like 1 every 2 or 3 years because palm screens break so easily.

If there's any money to be made by advertising, it would be by Compaq who makes such an amazing iPaq handheld that makes even a color palm look silly. Of course the demand for the ipaq is so high right now that ads would only make the backorders longer...

Palm needs LESS ads and MORE development. If they're going to bet the company on the os, they're going to LOSE eventually unless they do something real soon.


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