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Inside Intel Inside

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Case 4 Inside Intel Inside
What was the original motivation behind Intel’s decision to launch the Intel Inside branding campaign? What factors have accounted for the success of the campaign? From a consumer perspective, how does the Intel inside logo affect your PC buying decisions?
Intel was a market leader in PC Microprocessor industry. Due to evolving new technology and intensifying competition, sustaining technological lead was of utmost priority in 1990 for Intel. They had threats from growing powers like AIM (Apple, IBM and Motorola) tie ups in 1991. To counter this competition, Intel doubling up their R&D. There were simultaneous development of products of 2 generations going on. The other competitors could not catch up with Intel’s speed of development of new products. In 1997, Intel encountered loss of market in < $1000 PC market. This segment was fast growing. AMD was a major player and gained market share in this segment. Intel did not want to lower their price because this would affect their brand equity as well as reduce their bottom lines. So they countered by introducing another product that they positioned in entry level segment. This kind of product differentiation allowed them to gain leadership in that market without diluting their brand image. They also lowered price of their older product to compete directly with AMD.

Their product 286 was a big success in the market. But 386 processor sales did not pick up even 3 years after launch. This was mainly because the users were not able to appreciate the differences between a 286 and a 386 as a product. But Intel was in a position to push for sales because their next product in pipeline was about to be launched. Intel on verge of launching 486 chip. Then they conducted an experiment to find out whether there was a positive correlation between awareness levels and sales. They conducted the

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