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INTEL:BUILDING A TECHNOLOGY BRAND
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INTRODUCTION
Intel’s corporate branding strategy, which many credit for thecompany’s unparalleled success in the microprocessor industry duringthe 1990s, stemmed from a court decision. On March 1, 1991, U.S.District Judge William Ingram ruled that the “386” designation used byIntel for its microprocessor family was a generic description and couldnot be trademarked. Intel had been confident that the judge wouldrule in its favor, and the unexpected court decision effectivelyinvalidated Intel’s current branding strategy. This decision allowedcompetitors to use Intel’s established naming scheme, which couldhave been disastrous.Intel’s response was to develop a trademark name for itsprocessor family, the now-familiar “Pentium,” and launch a corporatebranding campaign designed to make Intel the first name inprocessors. Both moves proved to be enormously successful. Intelbecame one of the leading companies in the PC boom, enjoyingvirtually unchallenged market leadership through the 1990s. Problemsarose, however, as the PC industry slowed in the early 2000s. Intelfaced a future where the PC, which represented the core of thecompany’s microprocessor business, was no longer the essential toolfor the Information Age. Wireless telecommunications devices werebecoming increasingly popular, and they required different types of processors. The company had spent over three decades building the mostrecognizable brand in the PC microprocessor industry. Intel’s challengein the new century was to extend into innovative categories whilemaintaining the equity in the brand and its microprocessor leadershipposition. In response to this challenge, in 2006 Intel retooled its brandidentity, restructured its brand architecture, and launched an entirelynew branding campaign called “Intel. Leap Ahead.”
COMPANY BACKGROUND
Intel Corporation was founded in 1968 by Robert Noyce and GordonMoore. Soon thereafter, Andy Grove joined the firm and later becamePresident and Chief Executive Officer. Intel’s initial focus was theintegration of large numbers of transistors into silicon chips to makesemiconductor computer memory.In 1978, Intel introduced the 16-bit 8086 processor followed bythe 8088, the 8-bit bus version of the 8086 in 1979. Thesemicroprocessors were the first of the Intel “x86” line of microprocessors. At the time, Intel faced competition from a numberof companies, the most serious being Motorola with its 68000
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microprocessor. In response, Intel launched a campaign to make the8086/8088 architecture the standard in the emerging microprocessormarket. A critical milestone was IBM’s selection in 1980 of the 8088 asthe exclusive microprocessor architecture for its first personalcomputer. The success of the IBM PC placed Intel at the center of thepersonal computer revolution and established Intel’s x86microprocessor architecture as the de facto industry standard.Intel continued to produce chips with improved performanceover the next decade. In June 1988, Intel introduced the Intel 386 SXmicroprocessors, which became the backbone of IBM’s and othermanufacturers’ growing PC lines and positioned Intel for its explosivegrowth over the next five years. In April 1989, the companyintroduced the next generation microprocessor, the Intel 486processor. In 1990, Intel sold approximately 7.5 million 386 and 486microprocessors.
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Intel’s 1990 revenue from 386 microprocessor salesalone was estimated to be $850 million.
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As of 1990, Intel had $3.9billion in sales, representing a 360 percent growth in 10 years, and$650 million in earnings, representing a 570 percent growth in 10years. Intel microprocessors were found in almost 80 percent of all IBMand IBM compatible machines. The company, one of the largestsemiconductor manufacturers in the world, was recognized as theundisputed industry leader.
THE MICROPROCESSOR INDUSTRY IN THE EARLY 1990S
Since 1986, Intel had been the only supplier of 386 and 486technology. A number of competitors, however, had announcedintentions to market their own versions of Intel’s 386 and 486microprocessors in the latter half of 1990. The most serious threatcame from Advanced Micro Devices (AMD), who in October 1990announced its own version of Intel’s then hottest product, the i386 SX,called the AM386. In January 1991, two small semiconductors firms,Chips and Technologies and NexGen Microsystems, announced theirintentions to introduce 386-compatible chips within the year. Manycompetitors claimed that their 386 microprocessors would rival certainconfigurations of Intel’s i486 chip. Whatever their true technologicalcapabilities, Intel knew these chips could be named “386” or “486”and that it could do nothing to prevent such naming.
Intel’s Branding Issues
In the late 1980s, there was a significant shift in the general focus of the personal computer industry toward the mass-market, non-technical business, and home PC users. Recognizing this shift, Intelmoved from a “push” strategy to more of a “pull” strategy and beganto redirect a portion of its advertising efforts away from computermanufacturers to actual computer buyers. Until this time, the
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consumer’s choice of a personal computer was based almostexclusively on the manufacturer’s brand image, such as Compaq, Dell,or IBM. Consumers did not think about the components inside thecomputer. By shifting its advertising focus to the consumer, Intelhoped to create brand awareness for Intel and its microprocessors, aswell as build brand preference for the microprocessor inside the PC.Intel still considered the Management Information Services (MIS)community to be its primary buyer, but also recognized the growingimportance of the retail or “Circuit City”
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buyer, as a significant marketsegment and wanted a message that spoke directly to them.As the market and technology leader, Intel was always first tointroduce a new generation of products and establish the name andvalue of the new technology to consumers. With competing productscarrying the same or similar names, however, it became increasinglydifficult for Intel to differentiate its products from those of itscompetitors. As a result, consumers were confused about who made aparticular generation of microprocessor and what level of performanceto expect. Consumers were confronted with a product “alphabet soup”that made establishing a point of differentiation and a distinct brandidentity for Intel products increasingly difficult.In June 1989,
 
the company experimented with its first printcampaign targeted to the consumer. The $5 million campaignpromoted Intel microprocessors through its numbers—the 286 and386. The initial ad was an oblique but attention-getting print ad andoutdoor billboard that mimicked graffiti by spray painting over “286”and inserting “386 SX.” The tag line read, “Now, get 386 systemperformance at a 286 system performance price.” Within months,buyers began asking for personal computers with the Intel 386 SXchip. In 1991, the 80386 SX became Intel’s best-selling chip ever,shipping approximately 8 million units.
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Intel’s graffiti ad campaignsuccessfully had introduced the microprocessor to consumers, andmarket research indicated that an increasing number of consumersidentified with 386 and 486 microprocessor technology.
EVOLUTION OF INTEL’S BRANDING STRATEGY 
During the fall of 1990 and winter of 1991, Intel was involved in atrademark case with AMD to prevent their use of the “386” name in anew AMD microprocessor. A negative verdict would mean that in thefuture
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competitor could market its products under the samemarks used by
 
Intel. It would also mean that any computer makercould call a machine “386” without regard to the manufacturer whosupplied the chip. Concerned about the possible negative verdict andfeeling a general need to clarify strategy, Dennis Carter, vicepresident of Intel’s Corporate Marketing Group, began developing an
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