Thursday, January 28, 2010

AMD - Market Targeting

Market Targeting is the process of analyzing each market segment's attractiveness and selecting one or more segment to enter.

In the computer processor market you have only two choices, Intel or AMD. AMD has always been the underdog, struggling to turn a profit for over 3 years now due to battling Intel with inferior products but at the same price points. In 2009, AMD decided to change their strategy to combat its rival, choosing to capture the budget oriented consumer over the power users. AMD lowered the selling prices on their new 45nm CPU’s, the Phenom II and Athlon II, and put their focus on the $150-and-under market segment. For example, you can find a quad core CPU for under $100 with AMD while with Intel quad cores start at $160 dollars. With AMD’s new focus on the lower price points and with the help of the economic recession and consumers becoming more frugal, AMD was able to capture some market share as well as finally being able to turn a profit in the last quarter. AMD opened up 2010 with another batch of “bang for the buck” processors which shows that they’re still riding on their wave of success with their strategy and believe that dominating this segment of the CPU market is what will make the company rise from the ashes.

- Frank Luong – Section G

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