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INTEL Knows Best? A Major Marketing Mistake - Online Essay

INTEL Knows Best? A Major Marketing Mistake


INTEL Knows Best? A Major Marketing Mistake
Problem Statement
When Thomas Nicely, a mathematician at Lynchburg College in Virginia, first
went public with the fact that Intel's new Pentium chip was defective Intel
admitted to the fact that it had sold millions of defective chips, and had known
about the defective chips for over four months. Intel said its reasoning for
not going public was that most people would never encounter any problems with
the chip. Intel said that a spreadsheet user doing random calculations would
only have a problem every 27,000 years, therefore they saw no reason to replace
all of the defective chips. However if a user possessed a defective chip and
could ...

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main contention was that it
puts its customers first, and Intel was failing to do this.
Intel's handling of this defective chip situation gives rise to many
questions. During the course of this paper I will address several of them. The
first of which is how did a company with such a stellar reputation for consumer
satisfaction fall into the trap that the customer does not know best? Secondly,
what made this chip defect more of a public issue than other defective products
manufactured and sold to the public in the past? Finally, how did Intel recover
from such a mistake? How much did it cost them and what lessons can other
companies learn from Intel's marketing blunder so that they do not make the same
mistake?

Major Findings
Intel is spearheaded by a chief executive named Andrew Grove. Grove is a
"tightly wound engineering Ph.D. who has molded the company in his image. Both
the secret of his success and the source of his current dilemma is an anxious
management ...

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had managed to achieve brand recognition. "Once
the products were branded, companies found that they could generate even higher
sales by advertising the benefits of their products. This advertising led
consumers to regard brands as having very human personality traits, with one
proving fundamental to brand longevity -- trustworthiness." Consumers
readily identified a quality, up to date computer as one with a Pentium chip and
the 'Intel Inside' logo stamped on the front. This "push" marketing strategy of
Intel totally dominated the market, thus forcing the Pentium chip to the
forefront of the computer market, all at the expense of the cheaper 486. This
"push strategy" of Intel ...

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INTEL Knows Best? A Major Marketing Mistake. (2006, December 15). Retrieved December 23, 2024, from http://www.essayworld.com/essays/INTEL-Knows-Best-Major-Marketing-Mistake/57150
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"INTEL Knows Best? A Major Marketing Mistake." Essayworld.com. December 15, 2006. Accessed December 23, 2024. http://www.essayworld.com/essays/INTEL-Knows-Best-Major-Marketing-Mistake/57150.
"INTEL Knows Best? A Major Marketing Mistake." Essayworld.com. December 15, 2006. Accessed December 23, 2024. http://www.essayworld.com/essays/INTEL-Knows-Best-Major-Marketing-Mistake/57150.
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PAPER DETAILS
Added: 12/15/2006 09:29:56 AM
Category: Computers
Type: Premium Paper
Words: 1773
Pages: 7

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