Some US companies approach Europe with the view their U.S. style is their brand. Conversely, others go to great lengths to adapt. Both routes have their advantages and disadvantages and both types of US brands learn that the best route depends on how the local European countries perceive the brand, the product or service category.
For example, the NY Times recently quoted Fred Gehring, the Chief Executive of the all-American brand Tommy Hilfiger. Notably, Hilfiger produce two distinct collections - one for the United States, one for the rest of the world. Gehring said “It could save us a lot of expense producing just one collection - and the way the economy is now, that has appeal.” He added; “But it would cost us a lot in terms of sales. There are too many differences between Europe and America. We would end up with a compromise that isn’t good for either territory.”
The Tommy Hilfiger brand is a European success story. Revenues from the company, headquartered in Amsterdam, now outpace those of the U.S. business.
And it’s not just about product. There can be significant differences psychologically, culturally and business-wise. In general in the U.S. everything is concentrated and consolidated. Whereas in Europe, there is often a need for a decentralised approach. This can result in numerous outlets and order books filled with thousands of relatively small customers. In addition, for some sectors speed to market is crucial, technology is a good example. For these types of American brands, who are used to going to market in a week, discovering in Europe the same process takes, on average, 6 weeks, can be a real culture shock.
Some U.S. Brands also have to consider adapting their products. For example Brooks Brothers, another U.S. icon, realised the need for a Europe-specific operation soon after the opening of its flagship store on London’s Regent Street. Its European styles are cut closer to the body than those produced for the U.S. and its stores have a boutique look and feel.
Whereas; for The Gap, who for some time tailored its operation for Europe, in the last year the company has reworked its European strategy. It folded its European design division in London and, by August, Gap stores worldwide will be stocked entirely with collections designed in New York. They want a global perspective on the brand across all countries.
Recent events have also forced U.S. brands to have to come to grips with the world’s perception of their country. This has resulted in Americans having to be more apologetic about America than before.
Today, there is a new optimism for American brands. American broadcasting deserves much of the credit for this. Following on from the success of series such as Friends, series such as Sex in the City and Mad Men have helped to catapult the attraction of “a bite of the Big Apple” to front of mind awareness.
A further example is Desperate Housewives which has played a pivotal role in transforming the European view of American suburban life by appealing to European emotions. It achieved this, with outstanding success, by spicing up the story lines, glamourising the characters and locating them in a highly romantic, stylized New England village.
“Today’s Mad Men are doing very well in Europe” Terry Arnold, Head of Business Development for Nexxus states. “they have latched on to the importance of European marcoms experience and expertise in areas such as local market research, channels to market, digital marketing, web site optimisation as a way to avoid costly mistakes and ensure their brand really connects with their European customers”