Lava gets 'Intel'ligent; launches Xolo

Lava and Intel have come together to launch Xolo, the first smartphone powered by an Intel processor. afaqs! analyses the implications of this association for both players from a brand perspective.

Proving tech-cynics wrong, chip maker Intel has successfully entered the mobile space by partnering with Indian handset player Lava Mobiles to launch Xolo X900, the first Intel-based smartphone.

A television commercial titled 'Blink' highlights speed as the core brand proposition of this offering. From a brand as well as media spends perspective, the ad is a co-branded piece of communication.

Though the film makes no mention of brand Lava, it is common knowledge that it is one of the parent companies of Xolo. Given this knowledge, for those who never thought they'd say the words 'Lava' and 'Intel' in the same breath, it is a bit hard to take in.

Is this why the name Lava was deliberately kept out of Xolo's ad? Sunil Raina, business head, Xolo, Lava International tells afaqs! that consumers of high-end smartphones like Xolo have needs and aspirations that are very different from those of consumers of Lava. This, he explains, was the thought process behind not extending the Lava brand name into the Xolo ad.

An odd marriage?

In the past, we've seen different combinations of brands in such co-branded ads. Some feature brands that lie on slightly different rungs as far as popularity or pricing is concerned and some feature more or less equally placed brands.

Consider the recent ads for
Apple iPhone 4
, in which Aircel and Airtel played respective cameos. Experts saw this as an opportunistic move on the part of the telecom players as being associated with Apple was deemed to have a positive rub-off effect on their own brand value. Conversely, recall
the recent ad for Mercedes-Benz
, in which Vic Gundotra, senior vice-president, engineering, Google, speaks about the car's collision system that saved his life - both brands involved are colossal in their own right. It is the same with the
Nike-iPod 'Tune your run' campaign
; both brands are of similar stature.

What is, however, remarkable about the current Lava-Intel association is that the two brands lie on opposite ends of the spectrum, with one being a low end offering compared to the premium appeal of the other. While we've seen less premium brands take potshots at the giants, surreptitiously riding on the halo of the very brands they mock, a deliberate association between brands as far apart as Lava and Intel, makes brand analysts sit up.

"A brand like Intel will certainly have a rub-off effect on anything it is associated with. For us, Intel brought technological superiority, which is the message being conveyed in the ad," Xolo's Raina says. However, from 'odd marriage' to 'interesting experiment' experts have many names for this. afaqs! delves deeper to find out what each partner stands to gain or lose from this union.

Too far for comfort?

Co-branded communication is usually a complementary meeting of equals and some experts feel that the disparity between the two in this case is far too vast. "In co-branded communication, one brand may tend to be slightly stronger than the other, but there should be some synergy between the two in terms of the segments their target audiences lie in," explains Naresh Gupta, managing partner, Bang in the Middle, and strategic planner, according to whom the present tie up is all too skewed.

He feels that one of two scenarios can pan out: While Xolo may benefit from the association, it may even risk getting lost under Intel's strong shadow. People will watch 'that Intel ad' and buy 'that Intel phone', not 'that Lava or Xolo phone'. Further, this may just slide into a 'lose-lose' situation as "Lava consumers may not be familiar with Intel and Intel loyalists may see the Lava branding on Xolo and walk away."

Xolo riding on Intel's charm?

Risks aside, Xolo is in a favourable position. Prima facie, Xolo appears to benefit from this association on more than one level - from a product point of view it marks mother brand Lava's foray into the smartphone space with Intel's promise of speed and from a brand point of view, it barely takes an expert to point out that it gets to piggyback on the premium halo that accompanies Intel.

Xolo will not be the first brand to benefit from Intel's aura. History testifies for the fact that the famous Intel logo has sold many an unbranded computer in India. Speaking about the classic 'Intel Inside' campaign that has been around for years, Ramanujam Sridhar, founder, brand-comm, points out that Intel has been involved with co-operative advertising or 'ingredient advertising' -- where consumers' attention is drawn to something that's inside a brand -- for years.

The Xolo ad also signs off using the characteristic 'Intel Inside' statement. "I see similarities here," he says, "Lava stands to receive a positive rub-off from Intel." This rub off is not limited to just a boost in Xolo's brand value; rather, this association with Intel is deemed to have a positive impact on Lava's own growth story from an organisational standpoint, too.

Intel reaching out to the masses?

Look a little further and Intel's potential gains become visible, too. Firstly, by infiltrating the high volume mobile market in India, one that it has been vying to enter for a while now, Intel has ensured that it is at the right place at the right time. From a category perspective, Intel has made a smart move by shifting focus from PCs and laptops to smartphones, say mobile experts.

Extending this thought, R Sridhar, innovation coach, IDEAS-RS, says, "Intel has always been a component to something; a value-add or support function. Intel never went into selling directly to the consumer. It was classically B2B. Given the kind of mobile penetration in India, this could be Intel's way of going B2C and marketing directly to the end user."

Of course, one may argue that knowing the name of the chip-maker is hardly a consumer-relevant piece of data because the lay smartphone user's purchase decision is based more on factors like the price, features and other usage-related benefits than on the technological nitty-gritty.

Another theory suggests that Intel has deliberately partnered a weaker brand, so that it can call the shots in marketing or promotion-related activities.

Sridhar of IDEAS-RS says, "Often, for a powerful brand, starting with a clean slate or with a brand that is currently not so high profile, leaves more room for negotiations. This is sometimes better than trying hard to manage two strong personalities." Going by this logic, one can conclude that had Intel picked an equally strong brand for this mobile foray, consumers would've faced a conflict of imagery.

This is akin to picking a 'moldable' or malleable marriage partner so that it becomes easy to dominate the relationship.

Then again, Intel may have picked Lava due to sheer dearth of choice as most of the premium handset brands are already working with other chip providers in the market. But that's another story altogether.