USA: WAKE UP, UNCLE SAM. - The US has an unshakeable faith in 'universal products' such as Coca-Cola and McDonald's. But it can ill afford to ignore the European virtues of diversity and flexibility, argues Alan Mitchell.

Last Updated: 31 Aug 2010

The US has an unshakeable faith in 'universal products' such as Coca-Cola and McDonald's. But it can ill afford to ignore the European virtues of diversity and flexibility, argues Alan Mitchell.

What is it about the Americans? When it comes to building successful global brands, they seem to have a knack that we Brits - and other Europeans - can't emulate. A recent MORI poll of European businessmen for corporate identity consultants Henrion Ludlow Schmidt ranked three US companies - Coca-Cola, IBM and McDonald's - as 'exemplary' international brands way ahead of others, such as Mercedes and Shell. Likewise, US brands predominate in a global study of consumers' views of brand stature by ad agency Young & Rubicam. Among the top 10 are Kodak, Pepsi-Cola, Gillette and Colgate.

Britain's three biggest consumer brands - Coca-Cola, Walkers Crisps and Ariel - are owned by US corporations. And even as Far East brands continue their devastating assault on Western markets, the Americans continue to create new global icons such as Intel and Microsoft in computing and CNN, MTV and Disney in media and entertainment.

So what do the Americans have that 96e we lack? One simple factor is postwar history. While continental Europe was busy clearing up the rubble and Britain was distracted by the disintegration of its empire, the US was busy acting out its new role of global propagandist for capitalism. Brands like Coca-Cola, which had followed US troops around the world, now came to stand for a new global consumerist ideal, the 'American way of life'. America's vast home market also means mass-production and marketing's economies of scale really come into their own. Any brand that makes it big in the US has immediate global potential.

But the biggest factor is probably cultural. The Americans had attributes that fitted the postwar industrial world perfectly, argue Charles Hampden-Turner and Fons Trompenaars in their study, The Seven Cultures of Capitalism. From microprocessors to McDonald's burgers, Coca-Cola to superconductors, 'the American ideal is of the "universal product", reducible to parts and infinitely replicable. What is aspired to is the widest possible product appeal (universalism) combined with a manufacturing process that is reduced to simple steps (analysis) so that the parent company can manufacture wherever costs are lowest and sell to as many people as possible.'

In addition, through a history of management theorising, Americans have systematised this learning, says Steve Gatfield, Chief Executive at US advertising agency Leo Burnett's UK arm. 'They have tackled the business of building international brands as a management science. The Europeans and Japanese were never taught to systematise in that way.'

Other cultural traits help US global brand-builders, suggests Jim Williams, European strategy director at Y&R. 'While the Europeans live side by side with their differences, even relishing them, the Americans have a history of cultural assimilation - and they have been very successful at it.'

'Americans simplify, we complexify. They also have a natural optimism, fuelled by the American Dream, that the same fundamental human values are held everywhere.

And that's the basis for big global brands,' agrees Martin Glenn, marketing director at Pepsico-owned Walkers Snack Food.

So where does that leave European companies? There aren't any genuinely European firms - apart from the European outposts of US multinationals - argues corporate identity guru Wally Olins, because 'Europe is a series of countries deeply uneasy with each other'. But this could be a strength for European brands. While the Americans are very good at producing 'ordinary brands for ordinary people', Europe offers variety, distinctiveness, creativity, culture, fashion and luxury. Even though there will be a demand for 'ordinary' US products, market specialisation is one of Europe's advantages.

The drawback of US marketers' traditional approach to international brand-building is their assumption that 'if in any local market the mix isn't right, it's the local market's problem,' says Glenn. America's universalist approach could be reaching its sell-by date, agrees Y&R's Williams: his agency's ranking of global brands by 'vitality' not stature leaves European brands dominating the top 50 as names like Porsche, Ferrari, Rolls-Royce, Chanel and Christian Dior make their mark.

So even though their brands still dominate in Europe, the American corporate giants are having to learn to adjust. Now even Coca-Cola is beginning to target different ads to different cultures and McDonald's has accepted that not all restaurants can have the same garish look. Says Williams: 'European and American companies may be starting from opposite ends of the spectrum, but they're converging on the same point.'

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