US brands losing shine as Iraq sours sentiment

By JULIE MIDDLETON

Declining global respect for American cultural values is having a serious effect on the image of United States brands such as McDonald's, Coca-Cola, Nike and Microsoft, a worldwide study of consumer attitudes has found.

According to a report in Britain's the Guardian newspaper, the number of people who like and use US-branded products has fallen significantly over the past year, while brands perceived to be non-American have remained relatively stable.

The survey, by New York-based NOP World, questioned 30,000 people outside the US between January and March - a period marked by the growing difficulties for American forces in Iraq.

The survey covered Australia but not New Zealand. And although no similar research exists here, some local market researchers are seeing a swing from big brands, many of them associated with the US, to local brands.

From 1998 until 2002, NOP found that brands such as McDonald's and Coca-Cola were notching up healthy annual growth.

But last year NOP found that the growth in popularity of all major consumer brands, including those from Europe and Asia, had stalled.

Over the past 12 months the positive trend has reversed, with US products hardest hit.

NOP says the number of non-American consumers who "trust" Coca-Cola fell from 55 per cent to 52 per cent, while the McDonald's rating slipped from 36 per cent to 33 per cent.

Nike slipped from 56 per cent to 53 per cent and Microsoft fell from 45 per cent to 39 per cent.

"It's not like there's a massive boycott," says NOP managing director Tom Miller. "Instead, it seems to be an erosion of support. It is clearly a warning sign for brands."

Jeremy Todd, group account director for research company Colmar Brunton in New Zealand, says: "We believe ... that big-name global brands are going to start struggling, or at least taking hits, from more local or regional brands.

"This impacts on products and services. For instance, there is a trend towards people going back to the local butcher or local greengrocer, rather than the supermarket.

"It is a sign of people in New Zealand ... becoming more conservative and more local and community and New Zealand-focused."

Mr Todd and Dave Mansfield, the business director of Auckland market researcher TNS, say that the local swing is probably fuelled more by the threat of terrorism and a feeling that the outside world is frightening, rather than specifically anti-American sentiment.

But Mr Mansfield adds that as the survey took place before allegations of abuse of Iraqi jail inmates by American soldiers, local consumers with anti-US attitudes could find their sentiments hardening further.

When people were asked about brands associated with honesty, says the Guardian, Coca-Cola was found to have declined from 18 per cent to 15 per cent, and McDonald's, Nike and Microsoft logged similar falls. Says Colmar Brunton's Mr Todd: "The sample size they're talking about is huge, making those small shifts significant."

The total number of consumers worldwide who use US brands was found to have fallen from 30 per cent to 27 per cent, while non-American brands remained stable at 24 per cent.

The survey found the percentage of consumers who believed honesty was an important attribute of American culture was found to be below 50 per cent in France, Italy, Germany, Spain and Turkey.

In Germany, only 31 per cent believed honesty was an American attribute, and in Saudi Arabia just 23 per cent thought so.

Mr Mansfield says he "would not be surprised if brands started trying to distance themselves from 'typical' American values".