Marketing Superpower

The world’s consumers are American – they wear Levi’s jeans, Nike runners, have Kellogg’s cereals for breakfast, McDonald’s burgers with Heinz ketchup and a Coke on the go, while listening to Dr Dre and Katy Perry on their iPods; they play Call of Duty on their Xbox, use Microsoft Office at work, Facebook at home, Google to answer questions, visit Disney theme parks on holiday, and over the weekend they watch Pirates of the Caribbean XVII or whatever number we’re at, charged on Visa, Mastercard, or American express.

So here’s a question that Just Marketing is fond of asking: why? Why do the world’s consumers crave American brands?

Chew on your Wrigley’s for a moment.

Here’s three hypotheses in the form of questions:

Do American brands dominate because they are really, really cool? Quite possible.

Or do they dominate because they benefit from the largest domestic market of affluent consumers in the world? That’s also a hypothesis worth considering.

Or do they dominate because the United States has marketing savvy that no other country can match? Also likely.

In fact, it could be all three. But over the next couple of decades, the markets are going to test each of those hypotheses, as the dominoes fall, in sequence.

Let’s start with the last one. Yes, there is a marketing culture in the United States that is unique and unparalleled. The marketing industry, marketing know-how, marketing infrastructure, and the marketing machine in the U.S. are unmatched anywhere else on the planet.

But in an increasingly global marketplace, American marketing services are for hire. Companies anywhere, from any country, can access that unique know-how and the marketing infrastructure, as long as they’re willing to pay for it. And increasingly, they are. So when Samsung of Korea was ready to spend $200 million a year to build a global brand, the company hired the New York-based team of the marketing powerhouse, the WPP Group. Access to marketing know-how is equalized in a global world.

Our next hypothesis is that over the past 120 years or so, American brand builders have had the advantage of a large, affluent, domestic market. No other country had as affluent or as large a domestic market. This gave American companies huge economies of scale to develop new products and brand concepts. So products and brands were first built for the U.S. consumer, and then adapted and sold to the rest of the world.

But projections show that the within a couple of decades, given current growth rates, the largest affluent domestic market will be in China, not in the U.S.

Already China is the largest market in the world for mobile phones, for cars, and for many other products. And not just popular down-market products. The average size of the television screen sold in China is larger than that in the U.S.

As domestic consumption in China booms, products and brands will be developed for China first, then sold elsewhere. General Motors sells more than four times as many Buicks in China than it does in the United States. So the Buick Regal 2011 model for the U.S. market was designed in China, and was launched there back in 2009. How long before Chinese companies catch on that their products, and their brands have the local economies of scale that can give them global appeal? How long before global consumers tune into the economies of Haier washing machines and refrigerators; Geely cars; and Li Ning shoes?

Which brings us to the hypothesis that consumers around the world love American brands because they are so cool. And this is so true – they are very cool -- because they are embedded in a cultural tableau that is cool – Hollywood, the music industry, and television shows watched around the world present American brands as part of a very cool and alluring lifestyle. Americans are presented as winners, and American brands are an inherent part of that winning streak. Watch almost any American movie, and you will notice two constants: the American flag, and carefully placed brands.

But is that changing too? American values remain very attractive, especially in relation to the alternatives out there -- even if the misguided Iraq foray, the financial crisis, and Wikileaks may have crimped Superman’s invincibility somewhat. But any more such blows, and he may start looking positively Clark Kent-ish. That would not be good news for American brands at a time when other countries are attempting to conjure up a winning and cool image of their own. 

The Beijing Olympics were a huge exercise in creating cool context for Chinese brands. Does Li Na’s win at Roland Garros this year mark the beginning of something that consumers around the world will take notice of, and want to emulate? Will the teams at the FIFA world cup in Qatar be wearing Li Ning rather than Nike? Will the fans be drinking Wahaha Future Cola? Will the billboards be advertising Bank of China and Bao Steel?
Check out the video of Argentina's 2004 Olympic basketball team in a Li Ning commercial.

Building one global brand is a huge task. Building an entire brandscape, and the rich tapestry of a cultural context in which they are embedded, as American brands have done globally over the past 120 years, is monumental. And the edifice is robust. So it is unlikely that that will be supplanted any time soon. 

But others sure are trying.

Each of the three hypotheses will be tested in the coming decades…so we’ll have our answers soon enough.

How’s that Wrigley’s doing?

most recent           table of contents

Photo credit Just Marketing can by Jared Breski