Anti-Americanism and the Lure of Le Big Mac

The Economist (subs req’d) recently ran this article about the effect of anti-Americanism on the European sales of American-based brands. An empirical examination by political scientists Peter Katzenstein (Cornell) and Bob Koehane (Princeton) reveals that far from suffering ill effects of anti-Americanism following the US invasion of Iraq, US-based brands are prospering in Europe. Indeed, the actual sales reflect a sort of “boycott gap” between what consumers say they will do and how they actually act. According to the Economist:

That sales of firms closely identified with the United States have not fallen overseas is, in some ways, surprising. Messrs Katzenstein and Keohane cite a December 2004 poll, conducted by Global Market Insite, in which thousands of consumers in eight countries (Canada, China, France, Germany, Japan, Russia, Britain and the United States) were asked two questions about 53 American companies: would they avoid American products because of recent American foreign policy and military action? And to what extent did they see particular companies as “extremely American”? Overall, 20% of European and Canadian consumers said they were consciously setting out to avoid American products.

The firms most vulnerable to consumer boycotts included American Airlines, United Airlines, General Motors, Wal-Mart, CNN, American Express, McDonald’s, Coca-Cola, PepsiCo and Marlboro. Nike was not far behind. Immediately after the invasion of Iraq, several press reports trumpeted boycotts of American goods in Europe.

The Katzenstein/Keohane study showed no discernible effect of this expressed anti-Americanism or on the boycott movement to sales during the period:

They studied the revenues of three big American-based consumer-products companies –and three of their European competitors–in Europe and the Middle East between 2000 and 2004. The American firms were Coca-Cola, McDonald’s and Nike. The three European firms, Adidas-Salomon, Cadbury Schweppes and Nestle, were chosen because they compete in the same industries. As Messrs Katzenstein and Keohane note: “If anti-Americanism had a significant impact on sales, one should find US-based firms’ sales falling in 2003-04, when anti-American views rose sharply in Europe, compared to 2000-01…This fall in the sales of American firms should occur both in absolute terms and relative to the performance of European firms.”

In fact, the opposite happened. Between 2000-01 and 2003-04 all six firms increased their European sales. American companies also grew at least as fast as their European rivals.

To what can this boycott gap be attributed? The Economist concludes that European customers can draw a distinction “between President Bush and a Big Mac.” Or perhaps, as they suggest, it is because US-based brands adopt better marketing strategies to counter the anticipated boycott behavior. More likely, in my view, is the fact that these global “American brands” hardly seem so American anymore. Similarly, Nestle, which owns the venerable “American” brands Libby and Ralston-Purina, and Cadbury Schweppes, which owns Dr. Pepper and Snapple, hardly seem “European.” Whom do brand boycotts against global corporations hurt? Local bottlers and distributors? Manufacturing workers? Management and shareholders? And what is the nationality of each of those affected parties?

The efforts of some Americans to boycott French products in the wake of French opposition to the US invasion of Iraq ran into this problem of distinguishing products. (Is the Jerry Springer show really French?) They also failed to have any effect on sales of French brands in the US. At a time when Anheuser-Busch still ends its advertisements in the U.S. with the tagline “Anheuser-Busch, St. Louis, Missouri,” but is acquiring beer companies in China with great speed, is there really such a thing as brand “nationality?”