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Iraq war bites into US
business
By Jim Lobe
In addition to the human and financial
costs of the war in Iraq, the Bush
administration's foreign policy may be costing US
corporations business overseas, according to a new
survey of 8,000 international consumers released
this week by the Seattle-based Global Market
Insite (GMI) Inc.
Brands closely
identified with the US, such as Marlboro
cigarettes, America Online (AOL), McDonald's,
American Airlines and Exxon-Mobil, are
particularly at risk. GMI, an independent market
research company, conducted the Internet survey
with consumers in eight countries from December
10-12. One-third of all consumers in Canada,
China, France, Germany, Japan, Russia and the
United Kingdom said that US foreign policy,
particularly the "war on terror" and the
occupation of Iraq, constituted their strongest
impression of the US.
Twenty percent of
respondents in Europe and Canada said they
consciously avoided buying US products as a
protest against those policies. That finding was
consistent with a similar poll carried out by GMI
three weeks after Bush's November election
victory.
"Unfortunately, current American
foreign policy is viewed by international
consumers as a significant negative, when it used
to be a positive," according to Dr Mitchell
Eggers, GMI's chief operating officer and chief
pollster. "Some American brands become closely
connected to their country of origin and are
quintessentially American," he added. "They
represent the American lifestyle, innovation,
power, leadership and foreign policy."
Empire is bad for business
Whether the US foreign policy under Bush
is affecting the sales of US corporations overseas
is being hotly debated by advertising and public
relations firms, as well as the companies
themselves. Last month, Kevin Roberts, chief
executive of advertising giant Saatchi &
Saatchi, told the Financial Times that he believed
consumers in Europe and Asia are becoming
increasingly resistant to having "brand America
rammed down their throats".
Simon Anholt,
author of Brand America, has also predicted a
consumer backlash against US foreign policy. He
recently told the British trade magazine Marketing
Week that four more years of Bush's foreign policy
could have grave consequences for US companies'
international market share.
"There have
already been casual protest brands, such as Mecca
Cola, which are primarily political," he told the
weekly. "But things are now moving beyond that.
For instance, German restaurants are beginning to
refuse American Express cards. This is new
territory."
Other analysts have been
skeptical, arguing that recent declines in sales
in France and Germany by McDonald's, Coca-Cola and
Marlboro were due far more to other factors,
including flagging economies in both countries or
a simple failure by companies to adapt rapidly
enough to consumer tastes.
But the new
survey, as well as the one taken by GMI last
month, suggests that the unpopularity of US
foreign policy may indeed be playing a role, at
least for companies that are either strongly
identified with the US or are perceived as having
similar characteristics as its foreign policy.
"American companies are accused of
aggressiveness and arrogance because they insist
on imposing the American way of doing things on
their international markets; they are inflexible,"
according to Allyson Stewart-Allen, co-author of
Working With Americans, a business
bestseller published by Prentice Hall in 2002.
She argued that the more US companies
distance themselves from their US identity, the
better they will survive in the international
marketplace. "US companies abroad now need to
focus on adding yet more value and repositioning
their brands to consumers in the intensely
competitive global village in which they compete,"
said Stewart-Allen.
"The more aligned they
are with those customers - regardless of their
US-created DNA - they'll win." American companies
need to focus on alignment with international
markets and embrace their market differences and
idiosyncrasies.
The survey cited 40
US-based companies and asked consumers who said
they were trying to avoid buying US brands to rate
each one of them by how closely they were
identified with being "American", and whether or
not they deliberately avoided buying their
products.
The survey then plotted each
company's position on a quadrant divided into
"safe" and "insulated" squares at the bottom and
"at risk" and "problem squares" at the top.
Those deemed "safe" or "insulated"
generally were either not seen as particularly
"American" (Visa, Kodak, Kleenex and or Gillette),
or they apparently lacked real competition
(Microsoft, Heinz and Disney).
Visa was
the single-best performer: only 17% of consumers
identified as intending to avoid US brands thought
that it was "extremely American", and only 15%
said they intended to boycott it. Fifty-four
percent said they had used Visa at least once in
the previous month.
"Problem" companies,
on the other hand, included those that more than a
third of boycotting consumers said they intended
to avoid, and more than 40% of consumers said they
considered to be "extremely American". On that
scale, Marlboro was found to be the most
problematic. Sixty percent of respondents said
they avoided the product, while two-thirds said
they considered it to be "extremely American".
Only McDonald's had a higher "American" score, at
73%, but only 42% of respondents said they avoided
the Golden Arches.
In contrast to Visa's
performance, 48% of boycotting consumers said they
would definitely avoid using American Express; 64%
said they thought the company was "extremely
American" and only 2% reported using it during the
previous month. Other problem brands included
Exxon-Mobil, AOL, American Airlines, Chevron
Texaco, United Airlines, Budweiser, Chrysler,
Barbie Doll, Starbucks and General Motors.
The latest poll found that more than
two-thirds of European and Canadian consumers have
had a negative change in their view of the US as a
result of US foreign policy over the past three
years. Nearly half believed that the war in Iraq
was motivated by a desire to control oil supplies,
while only 15% believed it was related to
terrorism.
Nearly two-thirds of European
and Canadian consumers also said they believed US
foreign policy is guided primarily by
self-interest and empire-building, while only 17%
believed that the defense of freedom and democracy
is its guiding principle. Half of the entire
sample said they distrusted US companies, at least
in part because of US foreign policy. Seventy-nine
percent said they distrusted the US government for
the same reason, while 39% said they distrusted
the American public.
Fully 87% of German,
84% of French and 71% of British respondents had
negative feelings toward President George W Bush
himself. Moreover, British, French and German
consumers all felt that the cultural values of the
other two countries were closer to their own than
"American values".
(Posted with permission
from Foreign Policy
in Focus) |
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