Foreign Policy Not to Blame for Your Brand's Reputation

An Ad Age Editorial

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American brands appear to be taking a beating both here and abroad, but before marketers start blaming U.S. foreign policy for sales slumps, they should ask themselves whether the real issues are poor products and mediocre or misleading marketing.

Two weeks ago, Ad Age's front page carried a story about Hasbro wrestling with the tricky issue of how to make a movie about GI Joe that would be acceptable to the rest of the world. Then, last week, we published a story about a GfK Roper study that found American brands losing popularity in many markets overseas -- Coke, Kodak, Colgate and McDonald's all took a reputation hit, according to the findings. Roper's logic, and the source of Hasbro's dilemma, was that the Bush administration's military sorties have turned the rest of the world against us and our products.

It sounds like a reasonable explanation for an American company suffering slowing sales in an overseas market, but broader examination of the success of American brands suggests it is flawed logic. American Express is having its best year ever, its stock having recently hit an all-time high. OK, so it only gets a third of its revenue from overseas, but that third is still growing rapidly, despite the clear declaration of the company's origins.

Bank of America is having a good run, too. And the growth of Marlboro, one of the most inherently American brands the mind can conjure, just prompted Altria to spin off Philip Morris International so that it can enjoy the fruits of flogging carcinogens to the developing world unencumbered by all that U.S. litigation.

Whatever you believe about American foreign policy under the current regime, it's far from the primary factor in the success or failure of U.S.-based companies. Good products from good companies that are well marketed still sell well wherever they're stocked. The bigger problem for many American marketers today is that they take short-termist shortcuts such as putting their valuable brand names on substandard products, as we've witnessed with Mattel's recent recalls. Almost as damaging, such marketers claim too much for their products, which leads to disappointed customers and the sense that they are arrogant. American brands should stand for quality and honesty, but in many cases, they simply don't. And that's one problem you can't blame on Dubya.
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