Why Europeans hate Wal-Mart and McDonald's.

Commentary about business and finance.
Jan. 13 2005 6:34 PM

Don't Buy American

Why Europeans hate American Express and Wal-Mart, but like MasterCard and Colgate.

Since the Iraq invasion, marketing types have fretted that the growing rift between the United States and Europe would hurt America's iconic global brands. When Coca-Cola's sales in Europe fell last summer and McDonald's reported flat sales in Europe, critics were quick to point out the potential damage.

But not all American companies suffer equally. That's the conclusion of market research firm GMI. In a December poll, GMI asked 1,000 consumers in Canada, the United Kingdom, France, and Germany whether they considered brands American—from "extremely" to "definitely not." They charted responses on the x-axis of this graph. GMI gauged their dislike of the brand, which is charted on the y-axis, and asked whether consumers' willingness to purchase American products changed as a result of foreign policy. (One-fifth of participants said yes.)

GMI reached a surprising conclusion: Some American companies are more American than others. And Europeans seem to hate some American brands to the extent they represent things they think they don't like about America. The firms in the upper right quadrant—where brands are considered both American and undesirable—include the typical ugly Americans: a cigarette company (Marlboro), a fast-food pusher (McDonald's), a polluting oil company (Exxon), and a putatively rapacious retailer (Wal-Mart).

The danger of Americanness is explicit when you compare MasterCard and American Express. They offer similar and unobjectionable services. But MasterCard is safe while American Express polls in the danger zone. "If you look at MasterCard/Visa, it is localized globally," said Ken Pick, director of global project research at GMI. Visas issued in Germany are linked to German banks. By contrast, American Express shouts out its American citizenship. "Companies that don't localize the brand are the ones that are going to be at risk of suffering in the long run," said Pick.

How is it that one of the most quintessentially American companies, Microsoft (for a few more hours the parent company of Slate), remains squarely in the insulated quadrant? "People found Microsoft extremely American, but they won't avoid it because there's little alternative out there," said Pick. (It's good to be a near-monopoly.)

Interesting points, all. But I don't think a simple algorithm of Americanness adequately explains the results. Take a look at the safe quadrant. It seems that Europe, the metrosexual continent, is willing to overlook national biases when it comes to personal grooming and pampering. Personal hygiene companies Gillette, Kleenex, Colgate, and Procter & Gamble all avoid trouble. So do apparel companies Calvin Klein, Ralph Lauren, and Estée Lauder. (Maybe the French think Estée is français?)

And what people say they'll do in polls and what they actually do in the marketplace are two quite different things. A lot of this discussion of product avoidance reeks of aspiration rather than action. McDonald's, America Online, Marlboro, and Starbucks rank among the brands European and Canadian consumers say they most want to avoid. But most Americans will tell you they definitely will avoid McDonald's, only to look up sheepishly when caught wolfing down a Big Mac. I've been resolving to switch from AOL for several years now. And Marlboro? Have you ever met a smoker who didn't swear on all that is precious and dear to her that she'd quit that nasty habit next week? Ditto for caffeine freaks. The rankings of these products have little to do with foreign policy and everything to do with inertia and the lure of nicotine, caffeine, and french fries.

In the end, however, some of the rankings defy rational inquiry. How is that Jack Daniels, with its u-r-American name, is considered less American than German-sounding Budweiser? And some of the other results make me think that the people polled are just dumb. Chrysler, which polls in the danger zone as very American and unlikable, is owned by a European company!



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