Brand Management Inside Intel Inside

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- The PC market has already matured and has reached stagnation.

- There is extensive competition in the industry and Intel’s market share was falling.

- There was an influx of cheap PCs into the market by competitors like Advanced Micro Devices (AMD), Texas Instruments, and Cyrix.

- PC market was a highly technologically driven market where consumers demanded for high technological changes and continuous advancements. So there was a need to continuously innovate and advance in technology to be at par or overtake the competitors.

- The competition in the PC market remained stiff not only at the low end market but also at the high end. For example in 2000 AMD had briefly threatened Intel’s technological dominance by being first to break the 1GHz barrier with a version of its Athlon chip.

Q4. How has the Intel’s advertising focus changed?

Intel initially tried a low cost experiment using billboard advertising in a single market. They began by covering billboards in Denver with a large 286 enclosed in a circle. They then splashed a big graffiti style red “X” over the numbers. After a few weeks, they added a large 386 enclosed in a circle. The 386 sat alongside the crossed-out 286, and the billboards promoted the fact that the 386 was now the same price as the 286 but with many more advantages.

Intel had two main motives:

- To create more advertising in the industry

- Get Intel logo on OEMs’ products

The Intel Inside campaign was launched to create an umbrella brand that could spand successive generations of products. Intel went for co-op advertising with OEMs. Intel’s OEMs would be able to accrue co-op advertising dollars on the basis of their purchases of Intel chips. These co-op advertising dollars couls be used to pay for up to half the cost of any advertisement produced by the OEMs as long as they put Intel’s logo in their ads and on their computers.

Q5. Should the company extend the “Intel Inside” branding campaign to other non-PC categories such as cell phones and PDAs?

Intel Inside campaign was perfectly successful in creating a brand identity of Intel not only in B2B industry but also in B2C industry, where customers felt that microprocessors are essential ingredient of computers. The campaign also helped us the form to associate with the brand, two attributes “Safety and Reliability”.

Now as the PC industry started getting stagnated in the years from 1999 to 2001 and competition in the microprocessor segment increased significantly. Till now, Intel was leading in desktop category having high market share. Now as the market has huge potential in high-end in high end cellphone category, the company started its business in this category by getting a tie up with “Microsoft” to develop “template” for cellphones using chips from Intel and software from Microsoft. Although Intel was little sceptical about taking the business in non-PC category they knew that in non-PC category using Intel Inside branding may produce good result for the following reasons:

- As the demand in high end cellphone was rising, Intel could use its brand identity which was created from PC product category to successfully take forward to non-PC product category.

- This would also Intel to retain two attributes “Safety” and “Reliability” intact with brand. These attributes along with proper marketing channels could help conquer in non –PC category. This move will not only generate trust in the product but it will also help establish name in other categories also which was lacking.

- Intel had high market share in desktop category but had low market share in the other categories. This could be attributed to the fact that they only had Intel logo marketed in the desktop category. So extending this branding throughout other market like cellphones, could give them a bigger push

- Mobile and PC market are technologically driven in nature. Both had regular technological upgradation happening in short spans. Consumers considered both the products as high end technological products. Extending the umbrella brand from one similar market to another would actually boost the sales and since the PC market is already stagnant it would be a good idea to extend their brand identity to the thriving mobile market.

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