Global branding in the 1980s was influenced by a famous 1983 Harvard Business Review article, "The Globalization of Markets." The article argued that companies should leverage the "economics of simplicity" and sell standardized products around the globe. The benefits were lower costs and consistent customer communications.
That approach lost favor. Companies found that messages that resonated with South Americans fell flat in Europe. The "least common denominator" approach also shrank opportunities for differentiation.
So the next generation of branding in the 1990s focused on the so-called "glocal" approach. Companies would centralize production, research and technology, but localize marketing, distribution and PR to accommodate cultural and geographic differences.
Now another article—"How Global Brands Compete"—in the September issue of Harvard Business Review may presage the next generation of branding. Based on results from focus groups involving 1,500 urban consumers, age 20 to 35, in 41 countries, the article argues that many popular brands have largely lost their nationalistic connotation.
Coca-Cola is not an American brand, L'Oreal is not a French brand, and Samsung is not a Korean brand. Rather, they are global brands. They are symbols of a global culture created by the Internet, travel, music and other influences that easily seep across borders.
Global brands have three dimensions:
- They signal quality. "Made in USA" or "Made in Japan" no longer carries as much weight as an individual brand reputation for quality.
- They represent positive international attributes. Apple says cool, no matter what country.
- They represent vehicles for social responsibility. Consumers demand more from global brands, which helps to explain why McDonalds has been so heavily criticized for its labor practices in the UK and Nestle's infamous sales of tainted baby formula in Africa continue to damage their brands.
Another aspect of the study identified four consumer segments: global citizens, global dreamers, antiglobals and global agnostics.
Some 55% of respondents were global citizens who saw global brands in terms of quality and as guardians of consumer health, the environment and worker rights. Global dreamers, constituting 23% of respondents, were consistent admirers of global brands. Said one Costa Rican, "Local brands show what we are; global brands show what we want to be."