'Intel Inside' ignites mobile branding war

As the mobile computing wars heat up, chipmakers that supply the crucial components inside smartphones and tablets aim to grab more of the glory.

Not content to remain in the shadows of hot consumer brands like Apple or Samsung, chipmakers including Intel, Qualcomm and Nvidia, want consumers to get to know the processors that power their mobile devices. They hope to build brand loyalty in the process.

Intel is leading the charge by extending its hugely successful “Intel Inside” marketing campaign beyond personal computers. Launched in 1991, Intel Inside stickers turned commodity electronic components into premium products, and eventually became ubiquitous on laptops.

This year, the Intel Inside logo has appeared on the backs of smartphones launched in the United Kingdom, India and Russia. Intel 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.

“Without a doubt, my goal would be to have consumers walk into stores and have Intel Inside as a key driver of which phone or tablet they choose, just like we’ve done in the PC space,” said Brian Fravel, Intel’s head of branding.

It remains to be seen how many handset manufacturers agree to put the Intel Inside logo on their devices. The highest-profile smartphone maker so far to use Intel’s branding is Google’s Motorola Mobility, which launched the Razr i in London on September 18.

Until now, space on most smartphones has been reserved for the vendor, such as Apple or Samsung, and carriers like Verizon Wireless.

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.

Part of the reason the Intel Inside campaign has been unrivaled in the chip industry is that no one else can match Intel’s $2.1 billion annual budget for advertising and marketing. Intel helps pay for the PC makers’ own ads, as long as they include Intel Inside.

Big chip player

Since the 1990s, Qualcomm has been a major player in the mobile chip industry. For most of that time, advertising has been an afterthought for the San Diego-based company.

Most of Qualcomm’s marketing has been directed at a specific category of tech enthusiasts keenly interested in the components used in their devices. It has taken the form of YouTube videos, Internet ads and social media instead of TV commercials and other pricey campaigns.

In October, Qualcomm is set to start a new branding campaign, coinciding with the launch of tablets and other devices using its chips and Microsoft’s next-generation Windows platform. As part of the drive, Qualcomm will share advertising with manufacturers to showcase features of its chips, said Tim McDonough, a Qualcomm vice president responsible for marketing the company's Snapdragon mobile processors.

“You’ll start to see the Snapdragon brand appearing in a lot more places. But the key is having it appear in places where it has value to the user as a starting point. Right now, the consumer is saying, 'I'm ready for my next phone, I'm not sure what to buy, and I need some help,” McDonough said.

McDonough would not say how much Qualcomm plans to spend on advertising to counter Intel, which last year even paid hit Korean pop group Girls' Generation for TV ads and a single written for Intel.

Signaling its growing interest in creating brand awareness, Qualcomm renamed a professional football venue in San Diego "Snapdragon Stadium" for a few days last year.

And suggesting Qualcomm sees the PC industry as a model for its marketing, it hired a new chief marketing officer, Anand Chandrasekher, a veteran Intel senior executive, in August.

As much smaller Nvidia transitions to the mobile market, it aims to capitalize on game enthusiasts who are passionate about its PC graphics chips. Its well-oiled marketing department hosts tournaments and aggressively interacts with industry pundits.
Last year, Nvidia spent just $9.5 million on advertising, a sum that can't buy anything close to Intel's broad recognition. But it can help win loyalty from a narrow but influential group of young men.

Leveraging its popularity with game fans, Nvidia has created Tegra Zone, a collection of games optimized to work better on mobile devices using Nvidia’s Tegra processors. Ads for tablets like Google’s Nexus 7 boast of Nvidia’s punchy graphics. With stagnant PC sales, executives see mobile gadgets as the future. Annual sales of processors used in smartphones and tablets could hit $25 billion by 2016, compared with $9 billion last year, according to market research firm Strategy Analytics.

As formidable as the Intel Inside brand may be, extending it from PCs to a new world of smartphones and tablets has risks. Competition in mobile is fierce. If Intel fails to deliver the top performance that people associate with ‘Intel Inside,’ the chipmaker could damage its prized image.

“Putting an ingredient brand on the outside of your product should be like driving a sports car, something you want people to see you do because it's better,” said Andy Smith, a former Intel employee involved with ‘Intel Inside’ campaign.