Intel's Entry into Consumer Electronics - Trying a New Trade*



Case Code : CLCB017
Publication date : 2005
Subject : Consumer Behavior
Industry : -
Length : 04 Pages
Price : Rs. 100

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Key words:

Intel, Consumer Electronics, Sony, Panasonic, Brand Strategy, Brand Extension, neoBrands, Pentium III and IV, MP3 player and Digital camera


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The caselet, Intel's Entry into Consumer Electronics: Trying a New Trade, examines Intel's entry into new products and services. Intel, known for its computer chips, entered consumer electronics, but without much success. The caselet looks at the different opinions of marketing experts on the brand extension strategy activity carried out by Intel.


Consumer reaction during brand extensions
Reasons for a company going for brand extension
The need to assess the values associated with a brand


Intel, founded in 1968, had annual revenue of US$ 34.2 billion in 2004. The company is the world's largest chip maker. In 1998, Intel entered into the consumer electronics business manufacturing MP3 players and digital cameras. In order to bring in more revenue from areas other than the traditional Personal Computer (PC) processor business, Intel also

expanded to manufacturing hardware like web-surfing devices, network servers, and routers...

Questions for Discussion:

1. To what extent was Intel successful in leveraging on its image as a manufacturer of processors while entering into consumer electronics?

2. "The company in the early 2000s, moved out of the consumer electronics business." What were the reasons for Intel's failure in the brand extension that it undertook in 1998?