A hundred million bucks buys a lot of guys in metallic bunny suits, as US consumers will discover this fall when Intel launches a fourth-quarter media blitz unlike anything ever seen from a company that doesn't even sell goods to the general public.
The leading chipmaker - whose customers are PC makers - is laying the ground for its mascots to become a cultural icon, through a US$100 million ad campaign for radio and TV ads, Web banners, and print buys in way low-tech magazines like Martha Stewart Living and Vanity Fair. The advertisements all feature the Santa Clara, California, company's trademarked disco-dancing BunnyPeople. Intel introduced the silver-suited technicians with happy feet in a Super Bowl spot in January.
Of course, Intel, which commands 80 percent of the microprocessor market, has the money to spend. But why is it engaging in such an expensive bout of brand-building?
The obvious first goal is to promote its chips to the technologically unsophisticated masses who will soon be shopping for PCs this holiday season. "The guy walking into CompUSA to buy a $999 PC might not know Intel from anything," explained Kate Delhagen, a senior analyst with Forrester Research. "Intel is in a mindshare battle for consumers who are buying machines at cut-rate prices, some of which have other chips in them."
Intel is also trying to stimulate demand for its newest chip, the Pentium II, which succeeds the Pentium MMX, introduced during the Super Bowl.
"Intel is a master at using advertising to seed the market for chips it wants consumers to buy," said Bradley Johnson, technology editor at Advertising Age. "In 1989, they realized that the market was stuck with 286 chips, and it had factories spitting out 386 chips that no one wanted. So it went to end-users to convince them to buy 386 chips. That strategy worked, and now Intel wants the market to move to Pentium II."
The fall campaign, which will also run in magazines like Glamour and Self, is geared more toward women than previous Intel marketing efforts. "Women are increasingly becoming a more important target for us, and we're finding that television and consumer magazines are a great way to reach them," explained Ann Lewnes, Intel's director of worldwide advertising.
Some question the wisdom of Intel continuing to pour ad dollars into a very broad-based consumer branding campaign, rather than focusing on computer trade publications. "You don't influence computer buys the way you influence a car purchase," said Sheila Craven, president of AdScope, an advertising tracking service for the high-tech industry, who questions the idea of TV advertising for Intel. "It's a whole different mind set, she said.
Craven counts some of the second-tier chipmakers among her clients, and advises them not to conduct big consumer branding campaigns, but rather to focus on the business marketplace. "That's where the real money is," she said.
But Intel's strategy is to maintain its hold on the consumer PC market through non-stop trumpeting. John White, the worldwide creative director at Salt Lake City, Utah, ad agency EuroRSCG DahlinSmithWhite, which has handled Intel's account since 1990, pointed out that the challenge is to get people to care about the components that go into their PCs.
"Intel has to work extra hard to get any mindshare," White argued. His agency is working to develop the BunnyPeople characters, for which, incidentally, Intel has secured a trademark and may soon begin to merchandise as a toy - in the same vein as memorable pop culture figures as Ronald McDonald and the Michelin Man.
Forrester's Delhagen explained that Intel's desire for icon status is part of a widespread "attempt to build brands that are going to last 100 years." Brand equity will be increasingly important to Intel as other chipmakers get better at emulating its products, but more importantly she added, "tomorrow's marketing battles will be fought around technology brands."
And as the competition heats up, consumers will get to decide whether Intel's high-priced brand-building can turn the BunnyPeople into the next Pillsbury Doughboy, or tomorrow's Spuds McKenzie.
