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Intel Inside Smartphones: A Brand Disconnect?

By Alan Brew

It is one of the world’s most recognized brands, but you can’t see it, few people can describe it or explain what it does. And yet it is in a class with Coke, Disney and McDonalds.

A few years ago, if you mentioned the word “microprocessor” to the average person, few knew anything about what it stands for and what it does — even though it was the brain that powered the computer. But today, many personal computer users can recite the specification and speed of the processor, just as car owners can tell you if they have a V4, V6 or V8 engine.

You can thank Intel for this. The awareness of Intel has grown along with the awareness of the chip, and today is associated with technology leadership, quality and reliability.

The huge brand equity Intel has built can be ascribed to the “Intel Inside” campaign. Launched in 1991, Intel Inside stickers turned commodity electronic components into premium products and eventually became ubiquitous on PC laptops.

In early 1992, the first TV ad appeared stressing speed, power and affordability. It used state-of-the-art special effects to take viewers on a sweeping trip through the innards of the personal computer before hovering over the campaign’s raison d’être — the then new Intel i486™ processor.

Along with the TV ads (made by George Lucas’ Industrial Light and Magic), Intel added a distinctive and memorable :03-second animated jingle (known as a signature ID audio visual logo), displaying the logo and playing a five-tone melody. Starting in 1995, the now-familiar tone helped cement a positive Intel image in the minds of millions of consumers.

Now, as the computing platform shifts more and more to mobile phones, Intel is attempting to repeat the trick with smartphones. Badly underestimating how quickly the mobile market would grow, Intel is flexing its branding muscle to try to catch up with competitors such as Qualcomm and Nvidia.

The Intel Inside logo has appeared on the backs of smartphones launched in the UK, India and Russia. The company hopes to bring the phone campaign to the United States next year, seeking a marketing advantage over rivals like Qualcomm and Nvidia, which are not as well known among consumers.

Back in the heyday of the PC, the Intel Inside branding campaign was an exciting innovation in a dull and undifferentiated industry. Even when Advanced Micro Devices had superior products, Intel still managed to out-sell AMD’s processors in the client space. However, times have changed.

Today’s smartphone market is different. It is heavily branded, and consumers are brand loyal. They do not really care if their smartphone has a Qualcomm chip or an Intel chip. They buy an iPhone, or a Samsung Galaxy. The phone is expected to be fast, to conserve power, and to have great software.

For emerging smartphone brands, with little name recognition of their own, partnering with Intel may be a no brainer. At the other extreme, Apple refuses to share branding with any of its suppliers.

There is also rivalry for mindshare from the carriers, such as Verizon and AT&T. Providers of operating systems, such as Google’s Android, also covet consumer loyalty — their logos sometimes appear briefly on screens when devices are turned on.

As formidable as the Intel Inside brand may be with its $2.1 billion annual budget for advertising and marketing, extending it from PCs to the new world of smartphones and tablets is not without significant risks. If Intel fails to deliver the top performance that people associate with “Intel Inside,” and it becomes associated with the lower end of the smartphone market that differentiates primarily on price, not brand, the chipmaker could seriously damage its prized image.

View the below Intel Inside Analysis.