POLITICS' EFFECT ON BOTTOM LINE

Published on .

Boycotters of French products weren't able to stop the first of eight scheduled underground nuclear tests in the South Pacific, but they have definitely sent a signal to French marketers.

Some French companies tried to distance themselves from their government's nuclear tests to avoid the growing boycott of their products around the world. Cosmetics giant Yves Rocher's ads in German, Scandinavian and Swiss publications expressed its opposition to the testing, and French consumer appliance maker Moulinex changed its label to "Made in the EU" from "Made in France" for products sold in the Asia/Pacific region.

Other French industries have taken a hit. Sales of French wine have fallen 50% since June 1 in Sweden, and about 40% in New Zealand and Australia, where some of the strongest boycott efforts have been centered.

The Australian government barred French companies from bidding for a $740 million air force contract to supply jet trainers and other equipment. Australian trade unions have refused to handle mail for French diplomatic missions, while other unions have instituted similar boycotts of French shipping and French building materials.

The French Chamber of Commerce is surveying its members to determine the extent of sales losses.

But French President Jacques Chirac's government remains unmoved-despite poll results which indicate his own citizens oppose the nuclear tests.

"I honestly can't believe that a boycotting consumer could imagine for a minute that the French government would alter a decision on national defense to increase sales of wine or handbags," said a Foreign Ministry official.

This certainly is not the first time a country's products have been boycotted for political purposes. And it is unlikely that it will be the last. Boycotts such as these presume that actions taken by a country's leaders can be affected by hitting that country's products. So far, there's little evidence this is true.

Still, as multinational marketers expand their reach around the world, they are opening themselves up to all kinds of political repercussions.

In India, a country where millions are hungry, small militant anti-Western groups have taken out their frustrations on a Kentucky Fried Chicken outlet in Bangalore and Pepsi bottles and posters in New Delhi.

Imagine if the U.S. was involved in a war as politically explosive as the Vietnam War was in the 1960s and 1970s. McDonald's, Coca-Cola, Microsoft-all might feel the heat in China, in Russia and elsewhere.

If marketers want to sell in this global village, increasingly they are likely to be forced to make politically-and even morally-based marketing decisions. That suggests that with ever greater frequency, successful global marketers must act as well as think globally.

In this article:
Most Popular