Micron turns to TV as it takes on Gateway

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Micron Electronics this week starts its first national TV campaign, part of a brash--and seemingly longshot--plan to displace Gateway 2000 as the No. 2 direct PC marketer.

The company now commands less than a 2% U.S. market share for all PC sales, ranking it a distant third in mail-order sales and 10th in the PC market overall. Yet Micron outspent direct leaders Dell Computer Corp. and Gateway 2000 in U.S. print advertising in the first half, proving it's willing to pay to play.


Micron on Sept. 28 began an estimated $5 million network and cable TV brand campaign that will run through yearend, supplemented by an under $5 million business print effort lifted from the TV creative. TV will run on National Football League broadcasts; Major League Baseball playoffs and the World Series; and news programs. The TV campaign was created and placed by Trahan, Burden & Charles, a Baltimore shop hired last November. Micron places print media in-house.

Director of Marketing Pete Johnson vows Micron will spend $20 million on TV next year.


The brand ads are in addition to the estimated $30 million to $40 million Micron will spend this year on direct-response ads in magazines and newspapers. Micron typically spends 1% to 2% of revenue on such demand-generation ads.

In this year's first half, Micron spent $22.5 million in U.S. computer and business publications, estimates Adscope, a tracking service. Adscope said Dell, about five times Micron's size, spent $22.1 million, while Gateway, three times as big as Micron, pumped $17.6 million into print.

Gateway this month began an estimated $20 million-plus TV campaign from D'Arcy Masius Benton & Bowles, Los Angeles, and Dell last summer began a brand push on TV via Goldberg Moser O'Neill, San Francisco.


The direct PC market is booming as consumers and corporate customers buy into the low prices, strong service and latest technologies pushed by Dell, Gateway and Micron.

Red-hot Dell is pushing into the consumer market, while Gateway is both pressing beyond its enthusiast base into the broad consumer market and moving--with some hiccups--into business.

Micron, which emerged this decade as a favorite among PC enthusiasts, will use its brand campaign to build unaided awareness with business users. Alan Reisberg, exec VP-account director at Trahan, acknowledged Micron starts with "unbelievably low awareness" in business.

Three 30-second spots portray the sad plight of computer department chiefs who were fired because they didn't know Micron. The campaign is aimed at their bosses and other non-computer people who influence purchases.


"We want people who have a role in approving purchase orders or specifying brands to push a little bit back at" the computer department, Mr. Reisberg said. "We want to try to have these senior managers force a call and at least an investigation" of Micron.

In one spot, unemployed "Dave" combs a beach for coins. "I didn't know my company could have saved time and money buying Micron computers direct," he laments. "I had no idea Micron's a leader in price and performance . . . but my boss, he knew."

Micron and the agency acknowledge the risk: Computer people may resent the loser portrayal. But Micron bets successful computer managers will accept the tongue-in-cheek humor and see themselves as smarter than the guys who got the can.


The campaign is almost as brash and bullish as Mr. Johnson's projection: He bets Micron, with $2 billion in revenue, will displace $6 billion Gateway as the No. 2 direct seller within two to three years.

Copyright September 1997, Crain Communications Inc.

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