Microsoft Pushes Windows Phone Partners to Ramp Up Marketing Spend

Microsoft (NASDAQ:MSFT) has been pushing its hardware manufacturing partners to increase the marketing budgets for Windows Phone devices in order to boost sales figures. Microsoft’s CEO, Steve Ballmer recently admitted that Windows Phone device sales have been below expectations as Google‘s (NASDAQ:GOOG) Android and Apple‘s (NASDAQ:AAPL) take the lion share of the market.

Check out our complete analysis for Microsoft.

Microsoft Boosts Marketing Efforts to Increase Windows Phone Sales

Microsoft recently released the Windows Phone 7.5 Mango update for all devices and will be launching new dual core, LTE enabled smartphones soon. However, marketing is one area where it has been lagging behind the Android and iOS significantly. The company is pushing its manufacturing partners and carriers to increase marketing and advertising spend and also step up retailer incentives in order to boost sales of Windows Phone devices.

Besides Android, Windows Phone is now the only viable alternative for any smartphone manufacturer. We expect revenues from Windows Phone to increase going forward, but they will continue to have only a marginal impact on Microsoft’s stock price, which is driven mostly by the Windows and Office divisions.

As such the OS could be a major player in the future. Gartner’s estimates suggest that Microsoft’s Windows Phone will become the second most popular smartphone operating system by 2015, overtaking iOS, a prediction that has attracted many naysayers.

We currently have a $28 Trefis price estimate for Microsoft, which is about 5% above the current market price. Windows Phone and Xbox together account for only around 8% of the Trefis price estimate for Microsoft.

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