MKTG200 - Marketing Research Individual Assignment- Building Blocks Inside Out - Assessment Answer

Marketing Research

Case Scenario/ Task

Intel: Building Blocks Inside Out

The Intel Corporation (www.intel.com) was founded in 1968 to build semiconductor

memory products. It introduced the world’s first microprocessor in 1971. Microprocessors,

also referred to as central processing units (CPUs), are often described as the “brain” of a

computer. Today, Intel supplies the building blocks for the computing and communications

industries worldwide. These building blocks include chips, boards, systems, and software,

and they are used in computers, servers, and networking/communications products.

Most of Intel’s customers fall into two separate groups: the original equipment

manufacturers (OEMs) and the PC and network communications products users. The

OEMs manufacture computer systems, cellular handsets and handheld computing

devices, telecommunications and networking communications equipment, and peripherals.

The PC and network communications products users include individuals, large and small

businesses, and service providers, who buy Intel’s PC enhancements, networking

products, and business communications products through reseller, retail, e-business, and

OEM channels. Intel is an increasingly global company. Only 35 percent of its revenues

are from North America, whereas Asia and Europe comprise 31 per cent and 25 per cent,

respectively. Revenues for 2015 amounted to $55.4 billion (intel.com).

Intel has shown phenomenal growth as a company. Much of Intel’s success can be

attributed to innovation within its marketing department. This innovation was required to

overcome several obstacles. The main challenge Intel faced was trying to sell an

ingredient brand, which is a component of a larger product. Thus, there is difficulty in

reaching consumers who will never see your product and might not even know what it

does or why it is there.

Intel began marketing research in the 1980s because it was having difficulty with its

customers not upgrading from the 286 to 386 microprocessor. Marketing research showed

that this was due to a lack of customer awareness, and Intel set out to change that. It

conducted a small but effective advertising campaign. In fact, it realized that it had

inadvertently created a brand of Intel in the process. Because of the success of this small

campaign, Intel began to realize the importance of marketing and marketing research and

started to direct more effort and money on these areas.

Marketing research revealed that in order to be effective in its overall marketing campaign,

Intel would have to reach the consumers and convince them that what was inside the

computer was as important as what was on the outside. This became the key element of

the “Intel Inside” campaign conducted during the early 1990s. This slogan helped Intel put

a name with its products, and it helped it encompass several of its products under one

title.

Furthermore, marketing research showed that it would be most effective for Intel to cross market

with its technology partners. This would help consumers understand the products

that Intel helped develop. The company did this by including the “Intel Inside” logo in its

partners’ ads. It also helped fund these advertisements. A problem with including its

slogan in others’ ads is that Intel did not want to intrude on the commercials. Intel decided

to help make the small logo sink in by accompanying it with a jingle every time it was

displayed. This jingle has become extremely recognizable and synonymous with Intel’s

slogan. All of this helped Intel realizes its goal of increasing consumer awareness.

Longitudinal measurement of advertising effectiveness via marketing research revealed

that the “Intel Inside” campaign was very effective.

Intel’s next idea was to create a name for its microprocessor. This would help the

company to avoid using the numbering scheme, which was not patentable, and to find a

name that consumers could identify their processors with. After extensive marketing

research, Intel chose the name “Pentium,” which was found to generate positive reactions

with its consumers. Between 1990 and 1993, Intel invested $500 million in advertising to

build its brand equity. By 1993, 80 percent of people in the United States recognized Intel

and 75 percent had positive feelings about the brand. Most important, 50 percent of

consumers looked for the brand when they were shopping. By 1994, Intel had captured 95

percent of the microprocessor market, due in large part to its marketing efforts.

Intel’s market share for microprocessors slipped to about 80 percent in 2005 as a result of

increased competition from its main competitor AMD. On December 30, 2005, Intel

announced a major overhaul of its corporate and product branding, a move designed to

symbolize the chipmaker’s transformation into a supplier for products beyond personal

computers. The changes included a new version of the company’s blue logo—without the

lowered “e” that had long been a part of Intel’s branding—along with a new tagline, “Leap

ahead.” In 2009 to better align major product groups around the core competencies of

Intel architecture and manufacturing operations, Intel reorganized itself into nine operating

segments. The history of innovation has continued. In 2012, Intel introduced the IntelR

Xeon Phi™ Coprocessor, marking a new era in high-performance computing. The

increased competition causes Intel’s marketing research efforts to become more important

than ever as it attempts to preserve its dominant place in the market. Intel has been very

successful because of its focus on technology, marketing, and marketing research. Intel

still faces future challenges, including increased competition, the opening of new markets,

and the development of new products. Intel will continue to rely on marketing research to

meet these challenges.

Conclusion

Marketing research has played a critical role in Intel’s phenomenal growth. Marketing

research was instrumental in developing the Intel brand, designing the “Intel Inside”

campaign, and crafting the new logo with the “Leap ahead” tag line. Continued reliance on

marketing research will enable Intel to enhance its image as a preeminent building blocksupplier inside out.

Questions

1. Discuss the role of marketing research in helping Intel devise the “Intel Inside” and

“Leap ahead” campaigns. Relate this to the marketing research process.

2. Intel would like to increase the preference for Intel chips among PC users in the

individual user as well as business user segments. Define the management decision

problem.

3. Briefly explain the relationship between management decision problem and marketing

research problem. Define an appropriate marketing research problem corresponding to

the management decision problem you identified in question 2. Also identify 4 relevant

research objectives.

4. What is “secondary data”? Discuss the role of the Internet in obtaining secondary data.

Give 2 URL’s for useful information sites and explain in 2 sentences how each site could

help Intel.

5. Define the target market in operational terms – 3 target markets for the qualitative

research and two for the quantitative research.

6. Discuss the role of qualitative research in understanding how businesses select PC and

network communications products. Which qualitative research techniques could be used

and why?

7. Explain the meaning of a “survey”. If a survey is to be conducted to determine

businesses’ selection criteria for choosing PC and network communications products,

which one survey method would you recommend and why? Describe 2 ethical issues that

Intel would need to address when conducting the survey.

1. Marketing research is a process that has helped Intel in linking with its customers by identifying their demands and it is only because of the marketing research that the company is able to make its unique position in the market. With the help of the marketing research the company got to know that there is lack of awareness among customers regarding processors and this is why company took decision to use jingles in the advertisement and it introduced “Intel inside” and this process reached till Intel introduced “leap ahead”. The process of marketing research starts with defining the problem and the marketing research team of Intel also did the same(Wible, 2011).Their problem was that their product was just an ingredient of main product and due to that customers were not aware of it. Thus, the lack of awareness was their problem and they wanted to address this problem at any cost. So after that they collated the data and the data revealed that maximum customers were unaware of the product of Intel and this is what the problem is. The process of marketing research has helped Intel in defining the objectives and on the basis of these objectives the company could capture huge market share by using “Intel Inside“to spread awareness. Secondly, the company used “leap ahead” after researching the market that its market share has been decreasing and it needs to come out with something innovative (Melanie, 2015).This is the innovative step that the company designed new logo and tagline and again captured its market share.

Figure 1: Marketing Research Process

Source:(Aghaei, 2014)

2. Intel is willing to increase the preference for Intel Chips among PC users in the individual user as well as business user segments and this is the management decision problem. This is because of the fact that till 2005, Intel has been working to target small users, large users and businesses, re-sellers, suppliers, etc. At this point Intel is facing competition from AMD and there are many new entrants in the market. Keeping in view market challenges and opening of new market it will be difficult for Intel to implement this decision(Strauss, 2012).The major problem of management decision is that shall it change its preference. The new decision shall be profitable as well as popular. The concern of management is that whether this customer segment will opt for it or not. The chips may be discouraged by the users that the company is targeting and in that case the company will have to suffer loss. The nature of management decision is action oriented and the decision needs to be oriented towards profit(Ali, 2013).Intel has called for overhaul change in its operating segments and with its decision it has identified majorly nine segments for operating. It is not an easy task to increase the preference for chips among PC users in the individual user as well as business user segments and this will take huge efforts and effective decision making on the part of the company.

3. Management decision problem is when the management needs to make decision about some aspects of the company. It basically takes place higher level management who are concerned with the profitability. On the other hand marketing research problem talks about the information that is provided by the marketing research so as to solve the problem(Ashworth, 2011).It may also be referred as the objectives. The relation between Management decision problem and marketing research problem is that the management gets information from marketing research problem to take the management decisions. The information provided by the marketing research helps the management in working out for the potential opportunities and thereby increasing the productivity. In this way management decision problem and marketing research problem are interdependent on each other(Haung & Sarigollu, 2012). The management decision problem here is the concern of management is that whether this customer segment will opt for it or not. The chips may be discouraged by the users that the company is targeting and in that case the company will have to suffer loss(Melanie, 2015).On the basis of this problem the marketing research problem is to find out the preferences of the consumers in PC users in the individual user as well as business user segments for Intel Chips. The information collected with the help of marketing research will help in management decisions.

Thus the objectives of the marketing research on the basis of marketing problems are as under:

• To collect the primary as well as secondary data related to the individual user.
• To analyze the opinion of the individual user and business users using suitable tools.
• To determine the popularity of Intel chips among in PC users in the individual user as well as business user segments
• To establish the reasons of non-preferences of Intel Chips by PC users in the individual user as well as business user segments

4. Secondary data is referred to the data that is already available. It is a type of quantitative data that has been collected by someone in the past other the user. Thus, using secondary data saves time as well as efforts of the user of the data. There are number of sources of secondary data like internet, newspapers, magazines, articles, journals, government records, etc. (BMJ, 2000).The most significant source of secondary data is internet. There are so many websites that can help a company with secondary data. The most relevant websites that can help Intel in secondary data are as below:

• Gallup Organization:gallup.com – It will help Intel in searching poll results, societal trends, special reports and social audits. This will help in knowing the trends for Chips as well.
• Forrester Research (Forrester.com) – This will help in Intel in knowing latest trends in technology industry. It also tells about the predictions in technology industry.

5. Target market is defined as a specific group of customers at which the service or product is aimed. Defining the target market is the first stage of a marketing strategy. The target market is decided on the basis of product and an estimation that a particular target market is most likely to buy services and products offered by the company(Jones, 2008). Target market is also affected by the marketing mix strategy of a company that comprises of elements such as price, product, promotion and place. The major characteristic of a target market is that they share similar age, lifestyle, income, etc. (Kang, 2014).Target markets are also separated into two major parts that are primary target market and secondary target market. A company defines its target market so as to focus on a particular group of customers and so that it shall achieve its marketing goals in an efficient manner. It is not possible for a company to target everyone because of the reason that every product has its specification and it is meant for a particular segment of individuals and it will only be bought by that particular segment(Devers & Frankel, 2000).The target market can be for qualitative research as well as for a quantitative research.

Three target markets for qualitative research are as follows:

• Technical enthusiast in the age group 20 – 25 years.
• Buyer Persona for computer chips
• Preferences of customers with income group 10k to 20 k per month for microprocessor.

Two target market for quantitative research

• Differences in the opinion of males and females in software companies
• IT companies
• 6. Qualitative research helps in knowing the perception and behavior of consumers and this is why it will also help in understanding how businesses select PC and network communications products. Qualitative research is a kind of exploratory research that will help Intel in finding broad methodological approach encompassing several other research methods(Kelly & Richard, 2000). With the help of qualitative research it will be known that what the behavior of business is when they select the PC and network communications products. Qualitative methods help in examining all the significant details such as how and why of decision making of a customer and undertake an in-depth study of it(Haung & Sarigollu, 2012).With its in-depth exploratory nature it helps in understanding the human behavior for a particular course of action and why they have selected that particular course of action is also ascertained by qualitative research.

The most significant and most common method of qualitative research is interview technique. This is the technique that helps in obtaining the opinion of the businesses as to how do they select PC and network communication and what are the factors that affect them. The semi structured or structure interview can be used to for this purpose. The reason behind using this technique is that it will help in knowing a lot of information about PC and network communication preferences of the business. Except for this, it is less time consuming and easy to use tool for qualitative research which provides significant research.

7. Survey is a term that is used to define a brief interview or a discussion with an individual regarding a particular topic. In this manner it is used to refer to the activity of collecting information about something by a researcher(Jones, 2008). It is an attempt by the researcher to know about the opinion and perceptions of individuals in a detailed manner. If a survey is to be conducted to determine businesses’ selection criteria for choosing PC and network communications products, the most suitable method would be interview. The reason behind using this method is that it will help in knowing the in-depth aspects of the behavior of business executives when it comes to choose PC and network communication products(Kelly & Richard, 2000).It will provide all the dimensions of their criteria and on the basis of that the company can make further decisions about the product. The reason to go with interview method is that it will not limit the data to some extent rather the respondent will have choice to speak about any aspect they want to speak upon. In this manner it will give all the expected information in an efficient manner. Interview method of survey is quite easier and less costly than that of other methods of the survey. While using this method of survey Intel may have to deal with several ethical issues when conducting this survey(Kevin, 2012).The first ethical issue may pertain to the anonymity of the respondents who will participate in the research. The second ethical issue will be to obtain prior permission from the respondents and respect their willingness to participate in the survey. Thus, Intel is required to take care of these two ethical issues while conducting the survey(Stella, 2010).