Gateway Targets iMac With New Ads

  |  August 26, 2002   |  Comments

The effort looks to promote the Profile 4 by attacking a smaller player, as PC sales remain lukewarm across the board.

Gateway Corp. is looking to take on Apple Computer in its bid to boost market demand for its PCs.

Poway, Calif.-based Gateway is looking to target Apple's popular iMac line of all-in-one PCs, which put the smaller manufacturer back on the map when it introduced the line in 1998. Despite commanding at best only 5 percent of the personal computer market, Apple, which has offices in Cupertino, Calif., spurred a design revolution with the iMac's sleek, candy-color plastic exterior.

Early this year, Apple revised the brand to incorporate a flat-screen monitor, and launched a slate of new spots created by longtime ad agency TBWA\Chiat\Day.

Now, Gateway is looking to an aggressive new ad campaign to convey that its new Profile 4 PC is slick and sophisticated as well, and that it compares favorably with the iMac on performance and price in addition to design. While the Profile 4 is being sold starting at $999 (with 128 MB of RAM and a 20 GB hard drive,) the Apple Store carries the iMac starting at $1,299 (with a 40 GB drive and 128 MB of RAM.)

The campaign's kickoff TV spot shows the Profile 4 literally jumping over several iMac computers, while listing how the Profile 4's strengths, such as access to more programs. The spot closes with, "Did we mention the Gateway Profile 4 costs less than the iMac?"

A magazine ad, meanwhile, will show the two PCs under the headline: "It's a close contest. Until you turn them on."

Gateway also commissioned tests showing that the Profile 4 was faster than the iMac in 3D video game performance, booting-up time, surfing the Web, and loading large files.

The campaign, which also will include an online portion, was designed by Gateway's agency of record, Siltanen/Keehn. (Chief creative officer Rob Siltanen, a veteran of Chiat\Day, actually spearheaded Apple's "Think Different" campaign of years past.)

Spending was not disclosed in the effort. Gateway said the television buy, which runs through September, should reach about 83 percent of adult Americans an average of 14 times.

"Since the debut of the first Gateway Profile computer in 1999, we've pushed the envelope with what can be done in an all-in-one PC," said Bart Brown, Gateway senior vice president of solutions. "Nobody can compete with the performance, functionality, style and unbeatable price of the Gateway Profile 4. And it runs Microsoft Windows and thousands of applications, games and software titles that the iMac can't run."

The news comes on the heels of Apple's Friday release of the its new operating system, OS X version 10.2, which is designed to be faster and adds new features.

In the past few months, Apple has been running an aggressive "switcher" campaign of its own -- targeting users of PCs based on Microsoft Windows. The ads, designed by Chiat/Day, criticize Windows-based PCs as being tough to use and prone to crashes.

Apple has not discussed whether the campaign has had a major impact on increasing its market share, but is likely to give hints on whether it has been a success when it next reports earnings, probably in October.

In any case, the new efforts by Gateway to take share away from the niche PC maker comes as the overall market for personal computers remains tepid. In July, Gateway posted losses of $61 million, or $0.19 per share, slightly wider than Wall Street expectations. Earlier in the month, Apple met lowered expectations of $32 million in profit, or $0.09 per share.

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