“Computer audio equipment maker Creative Technology Ltd. said on Wednesday it would spend US$100 million in 2005 to market its MP3 players worldwide, in a bid to wrest share from arch-rival Apple’s popular iPod. ‘The MP3 war has started and I am the one who has declared war,’ Creative Chief Executive Sim Wong Hoo told a media briefing, adding the United States would get the biggest share of the $100 million budget, followed by Europe and Asia,” Reuters reports.
“Singapore-based Creative is fighting to expand its share of the fast-growing digital music market as its computer sound card business declines. ‘I’m planning to spend some serious money — I intend to out-market everyone,’ Sim said at the launch of the company’s new five-gigabyte hard-disk, palm-sized Zen Micro player,” Reuters reports. “Creative is targeting a 40 percent share of the global MP3 market next year, up from 10 percent in the June quarter, Sim said. Apple held a 17 percent share in the June quarter.”
“‘We’re targeting (sales of) more than 1 million MP3 players a month in the current quarter and we are on track. It’s our target to beat iPod in this quarter,’ he added. Creative said it expected the MP3 player market to reach 30 million units in 2004, and more than double to over 60 million units by next year.”
Full article here.
MacDailyNews Take: 1 million players a month will not beat iPod in this quarter. Ain’t gonna happen. Apple’s internal estimates hover around 4 million units, so even if Creative did outperform and sell 1 million per month, they’d still be about a million units short. It’s best not to declare a war you can’t win. And, Creative’s going to “out-market” Apple? Sim Wong Hoo must be crazier than Steve Ballmer at a Microsoft Developer Conference.
Wishful thinking. With wide-spread rumors that Apple will also offer a flash player, Creative will need more then $100 million in advertising. Apple will certainly introduce new iPod models across the board at MWSF, in addition to the new ipodflash. I believe Apple is spending just as much in their iPod campaign.
Sim Wong who? Sounds like a Far East dictator. 3 words Whooie: not a chance.
This will only help Apple. As Creative spends their millions to get people aware of MP3 players and anyone planning on buying one for the first time compares the two and asks friends who already have taken the plunge with an iPod which is best. Even if Creative increases their sales, their advertising will just end up increasing iPod sales even more.
Would rather see rather than hear first. This approach is going to fail Cratives big time.
Sim Wong Hoo should understand that money isn’t everything in this game.
…sounds desperate to me!
little late…iPod is synonymous with mp3 player like Xerox is to copies.
I work for HP retail division and people come in and ask for iPod thinking all mp3 players are iPods. They end up buying an iPod anyway.
Hoo’s on first?
No brainer…
1. Walk into a Best buy and ask the sales person to do a live demo how to download music from a website and put it on an MP3 player. First, they won’t/can’t because they are not set up for a live demo. Second, you’ll get a huge sequence of confusing and impossible to remember click-on-this-then-go-here-click-on-that.
2. In an Apple store, the sales people will actually have you download a song from iTMS, using Apple’s account, onto one of the store’s iPods. (These people will connect and live demo ANYTHING in the Apple Store!) They did this for my father. Never having touched an iPod, he downloaded one of his favorite songs to the store’s iPod within 3 minutes. Simply, get your song at iTMS then plug in the iPod.
Only if Creative Technology’s products can be as simple as an iPod, will they have any chance at all.
…dann kann er gleich mir die kohle geben! dann ist es nicht ganz f�r umsonst!
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downtown crossing (in boston) is wallpapered with ipod adds, anywhere you look you see 10, at least. ads on tv ads in print, creative has a lot of catching up to do
Yawn.
Another wanna-be that thinks that the only reason that the iPod/ITMS has been as succesful as it has is because of MARKETING. That is the same way that Eisner thinks.
Eisner is a MARKETER, not an ARTIST; there is a difference. Eisner thinks that all you have to do is promote something aggressively enough and it will automatically make money. Walt Disney was, and Steve Jobs is, artistic by nature. One hawks, the other creates for the sake of making something beautiful.
Sim wong Hoo has made the mistake of thinking that all he has to do is outspend Apple in advertising dollars (just like REAL slashed its prices to $0.49 during a recent ‘promotion’) and that the effort will result in increased revenues for CREATIVE.
Mr. Hoo has a fundamental misunderstanding as to why the iPod/ITMS has been the #1, runaway best seller that it has been (I’ll give you a hint, Mr. Hoo), it’s NOT because of maketing. Figure the rest out on your own.
Did he go to the Rob Glaser school of marketing?
Creative declaring war on Apple. Wouldn’t that be like Rhode Island declaring war on the rest of North America – laughable.
I wrote about this guy on my blog this morning:
http://sonicinfusion.blogspot.com/2004/11/how-to-be-wanker-101.html
“Creative spend millions marketing its MP3 players”
MP3 player?
Oh, you mean a type of iPod.
The boy is not taking his medication. Has anyone called the nuthatch?
Wish I could waste $100 mil. This guy is about a year too late. He is bold now, but the weeping and knashing of teeth is coming.
It’s best not to declare a megahertz speed you can’t supply.
Oh man this Sim Woong Hung guy is absolutely hilarious..
Yeah.. I can just see all those Korean workers and engineers getting misty eyed at a Sim Woong Keynote… *rolls eyes.. no I’ve read about this guy before.. he talks alot about Creative’s brand equity (they make the Dell DJ) and how their brand equity lets them make commoditized mp3 players and slap other companies’ logos on them (not the Creative logo.. get it?)
Basically he knows nothing about Branding..
Moreover, he knows nothing about advertising.. you’re gonna outmarket Apple?
How does this sound.. “We’ll lower prices and take $100 million in losses just to sell more units than Apple”
Sadly, that might not even be enough.. On track to best Apple.. okay.. cuz.. last quarter they had a 90% share in the HD market..
Something tells me Creative isn’t wrestling with the same excess demand that Apple is.. and that may be the only (sort of) good news to report: no supply strains. hahaha
I thought Creative made WMA players.. I mean.. if you’re gonna differentiate yourself from the iPod (which plays MP3’s of course)
Chisco.. that is fucking sweet man.. glad to see that HP and Apple are working so closely together and able to help each other out! 😀 So cool to hear that!
If Creative is going to spend $100’000’000 for marketing, they will have to sell around 340’000 players just to get their money back. This will take them years!!
Just imagine Apple putting only $10 of each sold iPod into marketing, they would be able to spend a million per month, or $12’000’000 a year…
So, the question is: how much of Creative’s marketing campaign is secretly funded by M$?
Sim wong Hoo has made the mistake of thinking that all he has to do is outspend Apple in advertising dollars (just like REAL slashed its prices to $0.49 during a recent ‘promotion’) and that the effort will result in increased revenues for CREATIVE.
———-
The funny thing is this may get them revenue.. of course shareholders want to hear about PROFIT, not revenue.. but here’s where the mistake is: eating a loss in one market only works if you can make it up somewhere else.
You know where Creative wants to make it up? In the future.
They’re hoping that by slashing prices, they’ll have (put any drinks you have down.. swallow all your food before you read this) brand loyalty like Apple.
*shakes head.. slashing prices towards a brand religion… yeah.. just like Dell..*pffft
sorry: 10 millions a month and $120M/Year
(it seems I’m not better in mental arithmetic than those guys at Creative)
man I just hate this guy so much, i have to post again!!
for anyone who’s seen Team America World Police:
“Sooooo RONERY, Sooo Ronery….”
The fact that the iPod has become the cultural phenomenon that it has, has nothing to do with the amount of money spent on marketing. It was the right product at the right time. There were plenty of other DMPs on the market when the iPod took off, but none of them had the style or ease of use to catapult the product to cultural icon. Creative can’t buy that. It’s like the perfect storm of promotion. Apple’s marketing was part of it, but it also became very stylish to be seen with an iPod, and that’s not something you can buy. This type of popularity will never happen again with a DMP. Probably what will happen is that over the next year or so the iPod fire will burn out and the market share will become more evenly distributed, but I think the iPod will always hold the lion’s share because it blows away it’s competition.
Good luck Hoo. you’re gonna need it!
Hope springs eternal�but thats one heck of a leap of faith!