AMD’s brand value surpasses Intel’s for the first time

It’s a ‘dog bites man’ story because, for the existence of the two companies, Intel’s brand value has ranked among the highest in the world, consistently outstripping AMD. Under the leadership of Intel’s then-CEO Andy Grove, its former CMO Dennis Carter significantly increased this value by creating constructs such as the Bunny People and using a generous marketing budget to generate significant interest in Intel’s products.

However, like many C-level executives, Carter did a poor job of training his subordinates. The result was that decades later, Intel’s huge brand advantage was eroded. Finally Kantar Brandz Report AMD ranked 41st and Intel 48th on the list of 100 most valuable companies. Apple is first and Nvidia is sixth. Let’s talk about how this happened, what it means for AMD and Intel, and why the underlying problem could be dangerous for the entire PC and server industry.

We’ll close with my product of the week, the Hyundai Ioniq 5 N Electric SUV. For a fraction of the cost of expensive, high-performance cars or SUVs, it has impressively good performance and is more fun than a Tesla. It is probably the fastest fast hatch on the market today.

Intel Inside: A Marketing Legacy

Intel Inside was a program that my wife ran for a while, and it was one of Intel’s most powerful resources. You’d have a hard time naming another brand asset anywhere near the name recognition that Intel had before.

Most of us don’t know which companies made the processors in our appliances, electric cars or EV engines, although we should really care who made the batteries, because they are not created equal. If asked, Tesla drivers don’t even know who made their batteries, even though Tesla has uniquely revealed that they come from Panasonic.

This recognition did not happen overnight. It was the result of a massive effort undertaken by Dennis Carter during most of the 1990s. Except for Apple under Steve Jobs, most tech companies invest less in marketing and often hire engineers as CMOs who have no deep understanding of the job.

This marketing support was an incredibly powerful advantage for Intel as related to brand value considerations. For example, Apple’s enviable position as the number one brand is directly indicative of its market success. However, McDonald’s number five rating and current financial performance may be an exception to that rule.

It reminds me of a story my grandfather told me when I was young. It was about the Wrigley Company and its founder William Wrigley Jr. He was on a steam engine powered train in the early 1900s. At the time, Wrigley was the top confectionery company in the industry. Wrigley had a young assistant with him who, like many new employees fresh out of school, thought his degree made him an expert.

In an attempt to show his intelligence, the employee asked Wrigley why he spent so much money on advertising, since he was already number one in the industry. Wrigley looked at him and asked. This train is traveling at about 60 miles per hour, why don’t they stop putting coal in the engine?

The point was that marketing is not just about acquiring leads; It needs to be maintained.

How AMD Overtook Intel

AMD is anything but a marketing powerhouse, but under CEO Lisa Su, the company has been extremely good at execution. Its products have been trouble-free and met or exceeded expectations AMD is making strategic acquisitions to close the competitive gap, not with Intel but with Nvidia and focusing on AI.

AMD has not traditionally been a top brand, but its consistent execution has helped it maintain and grow its value over time. Intel’s brand value has declined due to a lack of funding and an unusual level of focus on component marketing.

If you look at the Kantar report linked above, aside from Nvidia, which has become synonymous with AI, the first brand, like Intel, is a component brand Qualcomm, which is valued at 40th place, tied with AMD at about 41st. Qualcomm has that lead thanks to recent marketing efforts to boost the visibility of Snapdragon and its new PC offerings.

That’s one reason why most of these brands on this list rank in the 40s Market Development Fund (MDF) programs are not working now

These programs were unique in paying OEMs to market products that included parts from the MDF funding vendor. However, over time, OEMs started using MDF to supplement margins and cut marketing with little or no pushback from supplier vendors.

This diversion of funds crippled the programs. Despite Intel investing more in these programs than any other vendor, vendors are not spending dollars as intended, resulting in minimal demand generation or discretionary benefits for Intel. Instead, these funds became unnecessary discounts for the vendors receiving them, causing programs to fail across the board.

In Intel’s defense, it is doing better and is at the center of efforts to build US chip manufacturing capacity. Still, I think it needs a return to the kind of effort Dennis Carter did with Intel Inside and the Bunny People marketing campaign to restore its once impressive brand glory.

Wrapping Up: Technology’s Big Marketing Problem

Engineers run tech companies and are not known for their people skills. Like sales, marketing is about people skills but at scale.

Windows 95 was the most aggressively marketed technology product in history, but it also showed that Microsoft didn’t understand marketing. Although the program was hugely successful, it refused to be repeated because support could not handle the resulting huge volume.

The right thing to do would be to fix support. Instead, it collapsed and eliminated the people who drove Windows 95’s success. A few years later, it did the same with the group that pushed the Xbox success, which is partly why the Microsoft Zune and Phone were such failures.

After Dennis Carter left Intel, subsequent CMOs destroyed Bunny People and virtually eliminated the value of Inside Intel. They did not understand the need to protect and build the huge brand value that Intel once enjoyed. Every C-level executive should be an expert in their field, not a transplanted engineer treading water.

I think the entire tech industry is learning this the hard way. Dell recently improved to 81st place in the Kantar Brandz report. Lenovo, HP, and HPE didn’t even make the list. Tech isn’t the only industry showing the effects of under-marketing. The highest-ranked automotive brand is Tesla, at 26, the only US car company to make the top 100.

I first saw this car the other day while watching a drag race in it IONIQ 5N And its closest competitor, the Tesla Model 3 Performance. What attracted me was that the Hyundai was not only faster, but also a lot more fun to drive.

Interestingly, I once berated the now former CEO of Ford because he wasn’t learning enough about this “fun” thing from Tesla, and I suggested that if he didn’t solve it, he’d be out of a job soon (and he was). .

The Hyundai Ioniq starts at just under $70,000 but packs a ton of performance. It has up to 641 horsepower, a drift optimizer that actually works, a boost button, and it accelerates to 60 in 3.25 seconds.

The only downside is that the car has a range of about 220 miles. It’s fine around town and for the drag strip, but not great if you want to take it on a trip. It had decent simulated engine noise and realistic simulated shifting, which added to the fun, and its fast hatch design made it more practical than most performance cars.

CarWow running The Ioniq 5 N is up against a $300,000 Lamborghini Aventador SV. The Lamborghini wins but only by a car length, and it costs about 5x the Hyundai. Granted, Hyundai was overmatched, but in another Race seriesHyundai takes a variety of high-performance cars and does them extremely well (I feel sorry for the Porsche GT3 driver).

I still love my Audi e-tron GT. Sadly, no drag racing with my car, but it does 0 to 60 in 3.6 seconds (the new model is faster at 2.9 seconds from 0 to 60). So, Hyundai will beat my 2022 Audi too. Right now, the Hyundai Ioniq 5 N is the most fun electric car available at a reasonable price, setting a new standard for electric car success, so it’s my Product of the Week.

Maybe Ford, GM, and Stellantis can learn from Hyundai what they apparently didn’t learn from Tesla: fun selling!