American Brand Dominance: In Jeopardy?

The 90s were a golden era for both brands and the US. For US citizens, it was the Clinton era and the greatest decade in a golden century of unparalleled fiscal growth.

It was also a remarkable period in the history of branding. It was the decade that saw the revitalisation of Coca-Cola and its return to the top after its mistakes in the cola wars of the 80s. It opened with Microsoft developing its Windows line and ended with it being acknowledged as a global branding marvel. The decade witnessed Intel pulling off the branding coup of the century by turning boring old microprocessors into the key component brand in one of the most lucrative markets the world had ever seen.

As these three notable examples suggest, the rise of the US and the rise of brands were not entirely independent. Rather, the two grew symbiotically.

In this year's Interbrand survey of the world's most valuable brands, 30 of the leading 50 brands were owned and operated from the US. It may well be the biggest economic power in the world, but the US' relative share of the phenomenon that is branding far exceeds even this position.

There are many reasons for this imbalance in branding power. US marketers are trained at powerhouse schools such as Harvard, Wharton and Stanford to build brands brilliantly, while European counterparts rely on creativity and 'gut feel'. But perhaps a more obvious explanation for the supremacy of US brands can be found in their brand equity. Every brand possesses unique brand equity, but for many powerbrands, one of the sources of that uniqueness is brand heritage.

Originally a brand was a sign of production. It was a mark burned onto cattle by Vikings - brandr means to mark or burn in Old Norse. Brands originally were a sign that a product had been made by a certain person in a certain place and with certain ingredients. It was only relatively late in the evolution of consumer culture that 'brand' became a consumer word.

Now we have no idea who or where most of our branded products come from.

But we know what they signify about us when we consume them. True powerbrands, however, retain a link to their origins. Brand expert David Aaker once called brand heritage "the silver thread of authenticity".

In the 20th century, and especially the 90s, it was therefore no coincidence that brands forged in the US became the most powerful. The combination of strong US brand heritage and proficient marketing management ensured a US hegemony in the Interbrand league tables.

Now, as the US' global dominance is questioned, the presence of a strong US brand heritage may soon present itself as a hindrance, rather than a help. My old Dean, Professor John Quelch from Harvard, certainly thinks so. He has suggested we are about to witness "the emergence of a consumer lifestyle with international appeal that is grounded in a rejection of American capitalism".

The era of brand has begun, but the next ten years are likely to witness a rapid relocation in the origins of the next generation of powerbrands.

Sponsored By: Brand Aid

Comments

[LPH]

We may well be about to witness "the emergence of a consumer lifestyle with international appeal that is grounded in a rejection of American capitalism". But your old Dean first said this 5 years ago - have we seen a decline in US dominance over the past few years? Or evidence yet that this tide is truly turning? As (arguably) the leader in the current economic downturn, it's likely that we might also lead a decline in the "badge" status of brands, but whether international appeal will be the driver of this or not seems open for debate.

[Derrick Daye]

LPH,

Good point - what will the future hold? What we do know is in the past 5 years 7 US owned and operated brands have fallen out of Interbrand's top 50. What does this indicate? Open to debate for sure.

Derrick