Intel is a leading chip producer with a global market presence. However, in the recent years, the company has changed its business model to shift it from PC centric to data centric. These changes have proved profitable for the brand and it has started showing in the form of growth in revenues and profits. The company is enjoying faster growth. As a leading technology brand, Intel makes heavy investments into research and development. The company is exiting its non-core businesses to grow its focus upon the core businesses. The market leading position of Intel is a result of its consistent focus upon quality of products. This also gives Intel its pricing power. However, competition in the market has kept growing which has led to a need for higher investment in R&D and marketing.
This is a marketing mix of Intel analyzing the four P’s including Product, Place, Price and Promotion.
Intel manages its business through the following operating segments :
Client Computing Group (CCG) • Data Center Group (DCG) • Internet of Things Group (IOTG) • Non-Volatile Memory Solutions Group (NSG) • Programmable Solutions Group (PSG) • All other.
However, CCG and DCG are its only reportable business segments which is because the other operating segments do not make it to the quantifiable threshold.
Intel has a large product portfolio that includes a large range of products from processing to transfer as well as storage and data analysis. The company has brought a large range of innovative solutions for its customers including individuals and enterprises. Its products like gaming CPUs can be sold to the consumers directly or can be integrated by the customers into their end products like notebooks and storage servers. Some of these products can be combined like FPGA and memory with Intel Xeon Processors in a data center solution to enable incremental synergistic value and performance.
Intel’s broad product portfolio includes:
In the CCG category, Intel is a leading provider of platforms for notebooks, 2-in-1 systems, and desktops, including high-end enthusiast PCs. IN the DCG category, intel is a leading provider of data center platforms. Apart from that Intel also makes and sells components and software for embedded products as well as NAND flash memory products. In the PCG category, Intel is a major provider of programmable semiconductors and related products, including FPGAs and SoC FPGAs.
The platform products by Intel include a CPU and chipset, an SoC, or a multichip package that processes data and controls other devices in a system. These products are used mainly in the products and solutions sold through CCG, DCG, and IOTG.
The accelerators by Intel include Silicon products which can operate on their own or are used with Intel processors in a system, like the FPGAs, visual processing units (VPU), and Mobileye EyeQ SoC.
The boards and systems by Intel include server boards and small form factor systems like the Intel NUCs.
Connectivity products by Intel include cellular modem, Ethernet controllers, silicon photonics, fabric, WiFi, and Bluetooth.
Intel’s memory and storage products include SSD, persistent memory, and memory components.
Now, that the company has moved beyond being a PC centric company to data centric company it has expanded its product range to include end-to-end solutions, scaling from edge computing to the network, the cloud, and the emerging field of AI and autonomous driving. In this way, the product range of the company has grown a lot in the recent years.
Intel’s business is spread globally and its products reach its customers either directly or through the businesses it serves. The company also has its offices and employees in 46 countries. Intel has its headquarters in Santa Clara, California, United States. The company ahs 6 wafer fabrication sites in locations including Oregon, Arizona and New Mexico (USA) as well as Israel, Ireland and Dalian in China. Apart from these facilities, it also has 4 assembly test manufacturing locations globally. The company sells its products directly to the individual consumers as well as enterprises. These products are sold using both online and physical channels.
In terms of pricing, the company has used a variable pricing strategy. The pricing of products is decided upon the basis of demand, production costs and several more factors. The pricing and margins of Intel vary across its products and market segments. This happens due in part to marketability of these products as well as differences in their features or manufacturing costs. Its platform product offerings range from lower-priced and entry-level platforms, like the ones based on Intel Atom processors, to higher-end platforms based on Intel Xeon processors. The adjacent products by Intel also generally have significantly lower margins than the higher-priced platform products. Based upon demand for these products, the prices and profit margins of Intel can shift upwards or downwards. If demand for the higher-priced platform products decreases and that for the lower-priced platform products increased in any of Intel’s market segments, or if the market share of adjacent products increases, Intel’s gross margin percentage may decrease. The company prices these products, keeping in mind, demand, marketability as well as the needs of the various market segments.
Intel uses both traditional and digital marketing channels for marketing and promotion of its products as well as creating demand. the company works to increase brand awareness and create demand through both direct marketing as well as co-marketing programs. However, the company ad several of its products already enjoy high recognition. The Intel Inside logo and the large family of Intel processor is already well recognized in the world of computing. Apart from that the company also uses digital advertising and social media and television promotions for marketing and customer engagement. The other channels that the company utilizes for promotion of its brands and products include consumer and trade events as well as press relations. the key focus of its market communications is on higher performance ad efficiency as well as other factors like connectivity and communications. Intel also runs cooperative programs like the Intel Inside program in which many of its customers are also participants.
Intel Annual Report 2018