Analysis: 'Doing good' can be double-edged sword

US brands that assisted areas hit by the South Asian tsunami appear to be seeing an an improvement in the image stakes in the region.

Coca-Cola, which provided bottled drinking water, basic foodstuffs and medical supplies to victims, saw its brand image lift among 61 per cent of consumers polled by research company GMI.

Starbucks made an initial contribution of US$100,000 to international relief organisations Care and Oxfam, plus a donation of $2 per pound of Sumatra coffee sold last month, and won over 51 per cent of consumers polled.

The Bill & Melinda Gates Foundation, meanwhile, pledged an initial $3 million to non-governmental organisations to aid relief work and swayed 50 per cent of consumers in its favour.

GMI conducted the global survey of 20,000 consumers one week after the tsunami hit, measuring opinions on American multinational brands, corporate relief efforts and US foreign policy across 20 countries, including India, China, Japan, Malaysia and South Korea.

On average, nearly 60 per cent of consumers reported that American companies' tsunami relief efforts improved their impressions of US brands. In addition, 46 per cent of consumers indicated they would purchase more products from companies that had provided relief.

The uplift in brand sentiment comes as US brands tackle intensifying image problems. In recent years many have also had to bear the brunt of consumers' anger at US foreign policy to the point where GMI reports that one in five consumers consciously avoids purchasing American brands as a way of displaying discontent over recent American foreign policy.

The good news for US brands is that 56 per cent of consumers, who believe in hitting the nation through the wallet in a bid to bring about change, have softened their stance in light of the tsunami aid.

But is this upturn in brand sentiment likely to last or has the reputation of American brands fallen too far for it to be retrieved by a few goodwill measures?

Simon Anholt, co-author of Brand America: The Mother of All Brands, believes efforts may be too little, too late. "The problem is that once the image of a country has started to decline, international consumers tend to reject any data which doesn't confirm their negative prejudices. Bad news always travels further and faster than good, unfortunately: people always assume that bad news is more truthful than good, because it's something they're not supposed to know."

But consumers, argues John Woodward, regional planning director at Leo Burnett, are wise enough to separate business from government. He says most consumers are capable of distinguishing between the American lifestyle (which they aspire to) and the American leadership (which many despise).

"In most of Asia, there is little if any tradition of the sort of 'consumer activism' that makes buying a product a political act."

Most brands understand that one set of aid action isn't going to be enough to turn the tide. McDonald's, for example, supports charity efforts like Ronald McDonald House, while Coca-Cola runs projects such as Red Roof Schools for underprivileged children in the Philippines.

Others, meanwhile, are going further, joining groups such as Business for Diplomatic Actions, which works with government/branding officials to come up with ways to improve American's image abroad.

Woodward notes that it's important to address the pitfalls of corporate social responsibility (CSR), which at the end of the day can only add a halo of 'goodness', not counteract perceived 'badness' in the company's core offering. "In fact, if consumers have question marks over a company's core offer, they can quickly start to question the motives behind 'good' actions," he adds.

Branding specialists such as New York-based John Gerzema, chief insights officer at Y&R, agrees that localisation, actively participating in CSR and separating images from American foreign policies is key to acceptance.

"Because, ultimately, great global brands shouldn't feel French, British, American or Japanese, they should feel part of us," says Gerzema. "Consumers own brands, making provenance as important as global stature. Brands profit from this relationship and should take this contrast seriously, because it comes with the territory."

Industry watchers also agree that it's only a matter of time before anti-Americanism gives rise to brands such as Mecca Cola, Qibla and Zam Zam (which market themselves as anti-American and have had significant success in France and Germany) in Asia.

But, for now, the more pressing issue facing brands like McDonald's and Coke is tuning marketing strategies and products to tackle the health repercussions of a fastfood diet.

US AID: HELPING VICTIMS AND BRANDS

- Marlboro cigarettes (42 per cent) and McDonald's (29 per cent) were brands most cited as targets for boycott from a list of 35 global brands. They were also among the top brands identified as being 'extremely American' companies, along with Coca-Cola.

- Fifty-two per cent of consumers concluded that the US overall response to the South Asian tsunami tragedy was inadequate, with South Korea leading with 74 per cent.

- Thirty-five per cent of all consumers indicated that US foreign policy was the most important factor in formulating their image of America. Only three per cent of consumers indicated that US brands and products were most important in molding their impression of the US.

- Forty-six per cent of consumers said they would purchase more products from companies that had provided tsunami relief.

- Forty-eight per cent stated they would buy products in the future from those brands that had provided tsunami aid.