The recession appears to be over, in the tech segment, at least. For instance, last week Intel reported a 400 percent jump in first-quarter profits, to $2.4 billion, and a 44 percent rise in revenues. Such gains come at a time when consumers increasingly view laptops (and desktops, too) as a “necessity” and not “luxury accessory,” said Deborah Conrad, Intel’s newly minted chief marketing officer. (Conrad, who previously headed up the company’s business partnership with Apple, this month succeeded Sean Maloney, who is now co-general manager of the Intel Architecture Group.) In an interview, Conrad, who, in the ‘90s also oversaw marketing in the Asia-Pacific region for Intel, discussed why big business tech sales are bouncing back, why there’s still demand for innovation in a downturn and how the company is using digital and social media to help drive sales in-store.
Brandweek: After last week’s earnings, is it safe to say that you’re seeing demand for tech products pick up?
Deborah Conrad: You go back a year, back to when the economy [was at its lowest], and we were all bracing for the worst. But the one thing that struck us was demand for chips we make that go into consumer-oriented computers and laptops did not slow down. What that signaled to us was that a computer is now as essential as any other appliance or important utility around your home. It’s not a luxury good anymore. I hate to say this, but if your refrigerator breaks, you go and get a new one; if your computer breaks, you do the same thing. You don’t wait three months if you drop it in the parking lot and it falls apart. You get a new one. In the consumer space, that really carried the demand through this last year, and it’s become quite strong going into 2010 because computers are truly essential items now. In addition to that, last year, not surprisingly, large businesses stopped buying [computers]... Now, as we look into 2010, with the economy getting better, the big business market is starting to heat up again.
BW: Why does the “Sponsors of Tomorrow” campaign play up innovation rather than specific products?
DC: We realized that the difference for us, as a company, isn’t to just talk about what we make. We make computer chips; we make the best in the world, hundreds of millions of them in a year; and people know that and expect that. But the real difference is how we make our chips and who makes them, so, we’re celebrating the engineering culture and the fact that we’re a little quirky and the stuff that we work on today isn’t the stuff that people consume tomorrow. It’s the stuff you’ll consume five years from now. It’s really a way to bring ourselves to life and humanize the brand and emotionalize it in a way we’ve never tried before.
BW: But don’t you think consumers are looking more for value these days?
DC: What we find is consumers are really, really smart people and they definitely are looking for value. In some cases, they are looking for a good deal, but what we’ve learned through two decades of marketing to consumers in the communication and technology space is what they really care about is performance and making sure they get the most for their money. But they really want to buy the best they can afford. So, one of the things we will continue to highlight is that we are a company that continues to deliver the best performance for the dollar—the best price performance, if you will— for a consumer. The way we express that is, as we’re talking about our hero products—the core processor family—we talk about the fact that when you have [that processor] in your computer, you get something called “smart performance,” which means it adapts to you and your applications.
BW: As in?
DC: Say you’re working on something that is video intensive or [a project] in Photoshop, where the computer has to work extra hard. There’s a feature in the chip called Turbo Boost where it adjusts to increased performance as you need it so that you’re not looking at an hourglass or a pinwheel as the computer is chugging away.
BW: There’s a social media frenzy going on right now. What’s your philosophy with respect to entering this space?
DC: We don’t look at it as a thing unto itself and say, “Let’s have a social media campaign!” If we’re launching a new product, it’ll have earned—and paid—media as well. We’ll use social media to reach people who might have an increased interest in the product. For example, giving them early access to information and allowing them to have a more direct relationship with us.
BW: Where do you see social media playing a bigger role?
DC: [At retail.] Consumers go on a journey when they set out to buy something. They do their research, and they ask friends and people they know who are experts. Much of our work over the past year has focused not just on educating them about the category but also on helping them through that process. That’s where our digital marketing kicks in and really has to work harder because the next step of that journey has to do with the rise of retail. So, after you do your research, you go to the store. But if we don’t [train] the people who are selling the product, we can actually lose a sale. And I don’t mean lose a sale like they don’t buy something, but they might not be comfortable buying what we think they should. So, we’re using digital and social media to help people as they go through that research process online, and we’re working with big and small retailers—to train their sales force—so that they’re there to help consumers at that point of purchase.