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The Intel Inside case discusses
one of the most successful marketing campaigns of the 20th century. While
the case focuses on a decision faced by Intel’s VP of Marketing, Pamela
Pollace, about whether to expand the Intel Inside campaign to new product
lines, it also provides an in-depth discussion about the strategic benefits
that effective marketing can provide.
The Intel Inside campaign began
in 1989 when Intel realized that people didn’t fully appreciate the
important role that processors play in PCs. In the 1980s, most people knew
very little about how computers worked and did not consider processor speed
as an important characteristic in making computer purchasing decisions.
To help educate consumers and
build Intel’s brand, Intel developed the innovative Intel Inside campaign.
In exchange for putting the Intel logo on computers and in advertisements,
Intel agreed to pay for half of the advertising costs for computer
manufacturers. The campaign was hugely successful and helped make Intel one
of the most valuable companies in the world.
In 2002, Intel had almost 80%
market share in the PC processor market. However, the company was facing
challenges. AMD was a lower-cost competitor that had been steadily growing
its share. Further, the tech sector was in a major recession, and PC sales
growth had slowed significantly.
The central decision of the case
is whether Pollace should expand the Intel Inside campaign (by this point
more than 10 years old) to new product categories like cell phones and
PDAs. The campaign had been tremendously successful, and Intel did not have
anywhere near the market share dominance in mobile devices that it had in
PCs. However, Pollace was concerned that Intel was so closely associated
with PCs that she was unsure whether the same campaign could even work in
mobile.
In reality, outside of the case,
Intel did not aggressively pursue the Intel Inside campaign for mobile.
While it’s impossible to know “what could have been,” in hindsight this
does look like a missed opportunity.
The case takes on increased
meaning from our current point in time. Since 2002, the computing world has
been rocked by the advent of the smartphone, and Intel has not been
anywhere near as successful with these devices as it was in the PC market.
Indeed, Qualcomm—a chip manufacturer that barely factors in the original
case—is now the clear market leader in mobile device processors.
The Intel Inside case prompts us
to imagine the success Intel could have enjoyed if it had applied the same
aggressive marketing to mobile devices as it did to PCs.
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