Intel Launches a Huge Advertising Campaign : * Technology: The $250-million blitz is aimed at cutting down the competition and selling its next-generation 486 microprocessors.
Intel Corp., the top maker of the microprocessor “brains” of personal computers, has launched an unprecedented $250-million advertising campaign to bolster its name recognition and competitive brawn.
Intel wants to be the Nutrasweet of sweeteners, the Dolby of sound and the Teflon of frying pans--key components of quality products. But analysts called the costly high-tech campaign a gamble.
“I think it’s money down the drain because (computer) manufacturers don’t think Intel gives them a greater selling advantage,” said Michael Murphy, editor of the California Technology Newsletter, based in Half Moon Bay, Calif.
“The public, unfortunately, is either too unsophisticated to listen, or it listens to what trade journals say, not ads,” he said.
The campaign is the first by a U.S. semiconductor company to target a mass audience.
Industry analyst Tom Willmott of the Aberdeen Group in Boston said Intel needs to take aggressive marketing action to sell its next-generation microprocessors because of increased competition for its older components.
“Whether a campaign like this can be effective, I don’t know. But it’s clear the time for Intel to flex its muscles is upon us,” he said.
In April, Advanced Micro Devices Inc. introduced a line of mimic 386 microprocessors that beat Intel for speed, setting off a patent and copyright infringement legal battle with Intel. In September, Chips & Technologies Inc. also introduced 386 microprocessors the company developed on its own.
As Chips and AMD gain market share, Intel continues to dominate 386 microprocessor sales, which account for about half Intel’s $4-billion annual revenue. Some 85% of International Business Machines Corp.-compatible personal computers have Intel microprocessors, which control PC functions.
Intel’s new 18-month advertising campaign is aimed at cutting down the competition, increasing Intel’s name recognition and selling its next-generation 486 microprocessors, which have more speed and power.
“We want to create a brand image so the consumer feels he or she has something predictable when they buy a computer,” Intel Marketing Director Dennis Carter said.
Carter said Intel wants to educate customers about why they should upgrade to 486 machines, which are faster, able to run more complex software programs and easily upgradable. An industry shift from 386 to 486 would also likely hurt the competition, which doesn’t have 486 microprocessors.
“We’re driving the technology so fast that it’s very difficult for some consumers to keep up,” Carter said. “We want to help consumers make intelligent choices.”
The campaign continues an effort the company began in 1989 to have PC makers put “Intel Inside” stickers on machines to create brand loyalty. In fact, Intel is asking computer companies to pick up half the tab of the advertising campaign, and so far 240 computer makers have agreed.
AMD spokesman John Greenagel said the rival wouldn’t follow Intel’s lead.
“Our customers aren’t interested in promoting a product that has value added by somebody else’s component,” Greenagel said. “And all the advertising in the world won’t make up for having an inferior product.”
Intel’s worldwide advertising campaign will focus mainly on print ads, but Carter said Intel is considering television spots as well.
The cost rivals some top ad spenders in the nation. Philip Morris Inc. led with $646.5 million in the first half of 1991, according to Leading National Advertisers in New York. General Mills Inc., No. 10 on the same list, spent $200 million during the first six months of the year.
