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Advertising & Branding summary

Case: Inside Intel Inside

Big question: “is Intel planning to extend its ‘Intel Inside’ brand campaign to other product

categories, such as cell phones, PDAs (Personal Digital Assistant), and so forth?” 

  “Intel Inside” campaign was more than 10 years old, and it succeeded in creating one of 

the most valuable brands in the world.

  Pamela Pollace’s, vice president and director of Intel’s worldwide marketing operations,

primary responsibility to protect, sustain and build brand equity

  Risks by extending the brand they would be exploring uncharted territory. Also, if this

happened, they would be diluting the brand in some way. The cost of it would be

damaging the brand equity they’ve been working on so hard.

  Intel: business of microprocessors, (silicon chips) a central processing unit that controls

processing of data in PCs, servers, workstations and many other electronic devices. They

represent from 20% to 40% of a PC’s manufacturing cost. They had short product life

cycles

  Appearance of Apple (without Intel chip) Intel immediately set out to become the

leading chip supplier in this market. 1980 Intel secured a contract with IBM Personal

Computer, gaining 70% share of the market.

  Chip 386 first microprocessor that could operate multiple operating systems

  Slow adoption of this last chip. People wanted the previous version (286)

  They wanted to prove if the problem was that end users weren’t aware of the product

differencesmarketing experiment – market research: problems they found:

1. 

Computer buyers believed the 286 was capable of doing everything they neededto; so they didn’t had the need to upgrade it 

2.  Concerns that software used with their 286 wasn’t compatible with 386

  Challenge: change perception low-cost experiment using billboard advertising in a

single market; at the beginning they had the 286 number crossed, and then they had the

386 number enclosed in a circle. They also said 386 was the same price as 286 but with

more advantages (“Red X Campaign).

  Results: sales of 386 began to pick up; customers changed their buying plans as a result of 

the 6 week campaign.

  The problem even though this was successful, it wasn’t going to work with other

products that had to be introduced every other year.  Solution to create an umbrella brand that could span (abarcar) successive generations

of products.

  Answer Looking for umbrella brand names – they chose “Intel. The Computer Inside.”

Problems with Original equipment manufacturers (OEM).

  They ended up designing a co-op advertising program with the OEMs. In the program,

Intel’s OEMs would be able to accrue co-op advertising dollars on the basis of their

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purchases of Intel chips. Also the OEMs had to put Intel’s logo in their ads and on their

computers. The logo said simply “Intel Inside.” 

  There 3 goals:

1.  Create more advertising in the industry

2.  Get their logo on OEMs products

3.  Get consumers to pay more attention to microprocessors

  300 OEMs signed under this program.

  The co-op ads were supplemented by Intel’s own advertising campaign 

  All Intel’s advertising were designed to explain why having “Intel Inside” was important;

the 2 attributes they wanted for people to associate were safety (reliability) & leading

technology.

  94: Introduced Intel Pentium processor under the “Intel Inside” umbrella.

  “Animated jingle” – five-tone melody played at the end of every radio & tv co-op

advertisement.

  “Bunny People” characters – 1997 Super Bowl – immediate hit

  Intel ranked the 6th

most valuable brand in the world

  With the competition, they had to double up on its R&D investment (2 generations of 

chips at the same time)

  1994: small crisis with a minor flaw in the new Pentium processor - they replace all

  2002: marketing team was working closely with the technology teams. “Now, after

marketing teams do market research on consumer needs, they talk to the technical folks

to see how to turn those consumer needs into product features.” 

  For this period, the company’s brand image didn’t change. The core values of the brand

remained the same. Advertisements became more and more creative.

  Pentium 4 chip was considering to offer outstanding performance for digital mediaapplications; Intel had focused much of its Pentium 4 processor advertising on digital

media. Ads were controversial because they were featuring the Blue Man Group. This

generated controversy; however Intel’s marketing dept. believed this group represented

creativity, innovation and simplicity.

  Going back to the initial question, Pollace says: “Intel did not dominated these non-PC

markets the way tit did the PC market. However, it did maintain a respectable presence in

these markets with its StrongArm processor, which was used in several popular handheld

computers. Although, the co. had experimented with putting the Intel brand on other

devices in the past, but it had retreated from these efforts when it had become apparent

that the co. could not make returns in these markets commensurate with the level of returns from the processor business.

  More generally, it was not clear that consumers would respond to any kind of “ingredient”

branding campaign in these categories