It may be time for U.K. and European  companies to reassess cultural assumptions regarding their communications within the United States.  We are witnessing a profound shift in demography and attitudes, perhaps more profound than the election of our first baby boomer president, Bill Clinton.  The returns in the South Carolina Democratic primary held no surprise in terms of the black vote; it was strongly in support of Obama.  But the fact is that younger voters, those 30 and under, were also swayed by his subtlety of intellect, and messages of hope and inclusion.  Super Tuesday primary results, which have propelled Obama to the lead toward the nomination held plenty of surprises to political pundits and pollsters alike.

As baby boomers move into retirement, they grab headlines for their purchasing power and staying power – and do remain a force in our market and politics.  But they are akin to a setting sun.  If you take an intermediate to long term view, as significant brand owners must, their influence and interest in current affairs and setting trends is waning.

The America of 10 years from now will be a very different place than it is today.  Teenagers of 2008 will be advancing their careers (and those now in their 20’s and 30’s will be running the show).  This cohort is more eco-conscious and service-oriented, and less biased than any generation before it (those who grew up in the 60s may bridle at that suggestion, but it is fruit of their struggle, not a discount of it).  They also understand that the world is a much smaller place than it ever was, and this creates opportunities for brands to extend their transatlantic marketing reach; this generation will be more open than any before it to becoming global consumers and citizens.

So what inspired this post?  As someone who became aware during the latter years of the civil rights movement,  I can’t help but be moved by images of a black candidate for President of the United States standing in front of series of mostly white audiences celebrating a series of stunning electoral victories. 

While I am moved emotionally, the context for Swelled Head readers also is striking.  Thinking larger, many of the U.S. leading men in Hollywood also are black.  Wesley Snipes, James Foxx, Will Smith, Denzel Washington, Samuel L. Jackson, Morgan Freeman – these men lead many of the largest grossing movies.  They set trends and make money for producers of their movies.  Their endorsements, paid and unpaid, move markets (think Ray-Ban and “Men in Black”).

Black executives loom large in financial services and entertainment as well (although still under represented as a percentage of the U.S. population, they are influential).  The Oprah Winfrey Network will extend Oprah’s power and influence further into television.  The presidents of American Express, Time Warner, Aetna, Sears and Symantec also are black.

The fact is that America is becoming the melting pot it promised to be.  We aren’t color blind, but are becoming color-neutral.  Role models are defined more by what they do and say rather than their ethnicity.  And this trend is accelerating.

So what about your marketing?  Are you selling to the new America?  Does your advertising that targets teens and those under 30 relate to the way they see the world?  Do you embrace a more inclusive worldview, or are you “traditional?”  And by traditional, I mean stubbornly adhering to “the way it is done,” or “we’ll educate those Americans,” two paths to sure disaster for transatlantic brands.

Yesterday, Eos Airlines announced that it had filed for bankruptcy, with a complete cessation to flights. A little over a year ago, SwelledHead posted about the then emerging new breed of all-business class airlines. First came MAXjet and Eos, followed a few months later by Silverjet.

As transatlantic marketing professionals, we had to wonder about the possibilities for this trio. Did the all-business class business model make commercial sense? Who had pitched the price/service equation right? How would the major carriers react to a different type of competitor?

For expert insight, we turned to Henry H. Harteveldt, Vice President & Principal Analyst, Travel Research, at Forrester Research. He looked right past the self-acclaimed “better service at a lower price” promise, citing utility as the fundamental factor for long term success.

For most business travellers, the majority of whom don’t reach into their own pockets to pay for the seat, the big advantage of the major carriers is flexibility in the service. BA, Virgin, United and American have many flights leaving each day, so missing one really isn’t much of an ordeal. Moreover, all have major international feeder networks of their own and/or through partner airlines (these factors make Lufthansa’s all-business class offering workable). MAXjet and Eos started out with a single daily NY-LON departure. Even after boosting this threefold, it just wouldn’t be enough to meet the needs and expectations of seasoned business class flyers.

To reiterate Harteveldt’s words: “Part of the challenge for Eos, MAXjet, Silverjet and L’Avion [a French member of the all-business class cohort], is that you need to reach a critical mass to provide the utility the traveller needs. JetBlue would be nothing if it hadn’t expanded beyond its initial routes… its impact would be de minimis. The brand has to offer utility to its customer… must represent value and meet emotional and rational needs.”

Taking MAXjet as an example, he continued: “They haven’t mispriced the product, but missed opportunities. Perhaps they would have been better off not adding other airports, but greater frequency to London and new routes from JFK to destinations such as Paris, so it represented greater utility from New York… then added flights to Las Vegas and California to add utility for domestic and international travellers.”

While the better service at a lower price model worked well for some customers – typically the principals of smaller firms who travel frequently but are more price sensitive – MAXjet and Eos missed or were unable to fulfil the real demands in transatlantic air travel.

Where does this leave the remaining incumbent? Silverjet is still running at a significant loss, according to its last published results. While this is acceptable for a business that is still in its start-up phase, the current downturn in economic conditions will not be creating favourable conditions. While Silverjet may be able to pick up business from passengers forced off Eos (it has arranged a clever deal to honour tickets of Eos passengers), with just two NY-LON daily departures it is still not fulfilling the needs of most business class traffic. The situation does not look good.

That’s not to say that the major carriers have won the war. The battle still rages, but on a different front, from low cost carriers. The first of these is Zoom Airlines, a Canadian carrier that also plies the NY-LON route. A relaxation of the rules governing transatlantic air travel, the “Open Skies” agreement, may see more of this sort of competitor take to the air. Or maybe such a major change will see the large airlines reduce their prices against each other, squeezing out Zoom and any other such pretenders. There can be little doubt that the transatlantic airline business is a tough one.

If you were to put money on one that might succeed where others have faltered, Tesco would seem a safe bet. When it comes to achieving bounteous growth, both at home in the UK or overseas, the supermarket-and-almost-everything-else giant has demonstrated over and over that it’s got what it takes.

Yet, it too may be coming under the same terrible spell. The marketing director of Fresh & Easy, Tesco’s US convenience store enterprise, has hinted on his blog that all is not well. Simon Unwins has revealed that three months of review will take place before any further expansion, with analysts saying that results have been less than was hoped.

While Fresh & Easy could well be proving problematic for its parent, Swelledhead would not yet put its equally distended neck on the line and say that Tesco in America is doomed. Though history does not bode well, the company has boomed under the leadership of CEO, Sir Terry Leahy. Much of the success under his tenure has been found outside of the UK, where Tesco has shown an ability to adapt to local markets – a failure of the same being the undoing of foreign ventures at many other British retailers.

The Sunday Telegraph, the British newspaper which broke this story, reports that Unwins claims Fresh & Easy is simply taking a breather from its rapid expansion and is bedding down its operations. A potentially worrying sign is the news that Tesco is moving the CEO of its thriving Thailand business, Jeff Adams, to “work alongside” Tim Mason, the CEO of Fresh & Easy.

While the hiatus may indeed be unintended, and a bit of an internal shake-up somewhat disconcerting, to summarise it as the beginning of the end does seem a little premature. The UK lacks overseas success stories and has this lack of confidence is evident not only through failed international expansion, but a willingness to roll over to almost any foreign takeover. Tesco appears to be making sensible choices to keep things on track, and an eventual triumph would be a welcome shot in the arm for all British retailers with an eye beyond Blighty.

Read the original Sunday Telepgraph article here.

Juicy Couture is unavailable in the UK (except perhaps for a small level of importing into boutiques), but its designs bear many cultural hallmarks of its isles. Take, for instance, the company’s logo, with its crown and rampant ‘scotty’ dogs. Typography that plays on the style of Old English manuscripts. Men’s wallets embossed with a crest that could have been stolen from Her Majesty. And a signature line of chav tracksuits of which Burberry would be proud.

What caught my eye this morning was an ad in the New York Times for the company’s new male fragrance, Dirty English. Its visual mix of a traditional bottle shape and crest, combined with characteristic scally chains and sovereign rings, makes for a heady and impacting blend of urban styles. Quite how this emerged in La La Land is something of a wonder.

It just goes to show the potency of American Anglophilia, here at its most subversive in retail terms. Quite splendid, innit?

Click here to view the Juicy Couture website.

Click here for the entry on Juicy Couture in Wikipedia.

The value of a brand can be huge. Especially when you own an historic, storied high-end name. Like  Ferrari.

The Italian sportscar maker is fiercely protective of its identity, and understandably so. Having to deal with fakes built in back street garages in Thailand is bound to make you a bit touchy. Even so, the legal threats against a British Ferrari owner seem a little heavy-handed.

Dan Cawley of Manchester, England, is coming under pressure from the manufacturer for customizing his 360 Modena into a stretch limo. Apparently the inclusion of an additional centre section means the car no longer has the right to wear Ferrari badges. The company has given him 14 days to remove them, or face the consequences in court.

Brand identity matters, but is this really such an infringement? Swelledhead thinks the negative publicity this story will generate isn't worth the brand protection it seeks to gain.

More details here.

Citroen's ad for it's latest mid-sized family car, the C5, uses every stereotype in the book (well, the generally positive ones at least) to give the tongue-in-cheek suggestion that the car you're looking at is 100% Deutsch. Only at the end, as the camera revels the Citroen double-chevron grille, are we told that this "unmistakeably German" car is actually "made in France".

The ad acknowledges what everyone thinks and says already; German cars are superior. Citroen has played the "if you can't beat 'em, join 'em" game, and SwelledHead think's it's a smart move. Car buyers may not be convinced that any nation's cars are as good as those from Germany, but if they're as good then that's praise indeed.

The relevance of this to transatlantic marketing. Well, it's an interesting demonstration of the value that cultural identity brings to a brand. That applies well beyond the auto industry. Would you prefer French or Bulgarian Champagne? English or American tea? Nepalese or Scottish whisky? Might you try the unconventional alternative that promises to be at least as good? You might, which is what Citroen is betting on.

Personally, I think the C5 is an appealing new model that deserves success. It will be interesting to see how the market responds.

Capital intensive businesses such as airlines are prone to failure as their fixed costs are so high.  When the price of fuel or the number of people flying fluctuate dramatically, there is little management can do to adjust.  Throw in a much better capitalized competitor which decides that your nipping at its heels has gone far enough, and you’ve got a recipe for disaster.  When Swelled Head first spoke with Henry H. Harteveldt, airline expert at Forrester Research, he said pretty much the same (essentially predicting that American Airlines or British Airways could easily add Stansted flights and crush MAXjet).  His view was guarded to pessimistic as to the viability of MAXjet without something compelling to differentiate its business model, and he was spot on.

The failure of MAXjet casts a long shadow on business class airlines Eos and Silverjet.  They need to demonstrate a point of departure (sorry) that goes beyond a better seat, or they will follow MAXjet into the history books.  The biggest weaknesses these airlines face are narrow loyalty programs (useful only on their own routes), limited feeder networks, capital constraints that limit flights per day and number of destinations. 

Advertising in this category has generally been pretty uninspired given such innovation in the air.  Perhaps the failure at MAXjet will cause CMO's at Eos and Silverjet to rethink their efforts, and become more aggressive in pointing out their advantages and creative in presentation and positioning.  Public relations at these companies has also been notably weak.

A little go-to-market savvy might be useful, too, in making airlines such as Eos and Silverjet more compelling.  Unlike MAXJet, from which I never had a sales call, Eos is active in direct marketing and telemarketing.  Could be that Eos’ sales prospecting is differentiating enough – with only 48 seats to fill a few times a day, it wouldn’t take much of a sales effort, especially at prices that are lower than BA’s for a better service, to do the job. 

None of this is to say that MAXjet was a total loss to the business traveler; seating on many airlines’ transatlantic flights has been upgraded and the cost for business class travel has gone down dramatically even in the face of skyrocketing fuel costs. So I hope you will join Swelled Head in saying a fond farewell and thanks to MAXjet for its short but important service to transatlantic business.

With this post, Swelled Head returns after a six-month hiatus.  Sorry for the discontinuity, but we've been working on business strategy and development for our agency, Austin Lawrence Group, and can now return to Swelled Head with some regularity.  See you here again soon - and Happy New Year!

I’ve had the opportunity to meet a number of the partners and senior lawyers at the firm, first at its launch event for its handbook for Americans in London (with fantastic pragmatic advice across a wide range of personal, tax, legal and cultural subjects), and then subsequently in pursuit of opportunities for clients and prospects.  Everyone at the firm with whom I spoke or met has strong business acumen and understanding of entrepreneurship to go with their law degrees.  If you’re considering a new venture that crosses borders, I strongly recommend that you consult with Withers before making a move overseas or a major financial or legal decision involving your personal or business affairs .  The advice they offer could be very valuable. 

If you want a copy of its handbook for Americans in London, send an email to dawn.bishop@withers.us.com

Each quarter, Director magazine - the publication related to the UK's Institute of Directors - includes the "After Hours" supplement. Brimming with charming advice, such as how the weather impacts the British summer social scene or how to cruise Scotland to find the finest whiskies, the latest issue takes a look at British national identity.

Interesting to SwelledHead was the comparison drawn by how the British see themselves and how they're see by others:

The British see themselves as:                Others see the British as:

Rational and fair minded                          Reactionary and slightly bonkers

Passionate                                               Cold and aloof

Adaptable and accommodating                  Quaint and charming

Humorous                                                Funny

Culturally fragmented                               Civilised and cultured

Polite to a fault                                        Polite to a point of rudeness

Ironically amusing                                     Sarcastic and ridiculing

Understated                                              Ambiguous

Is this a fair or accurate assessment? To my mind, on the whole it would seem to be, but as an invented concept, being British - or indeed "Britishness" - is something that is difficult to define or agree upon. It's an elusive notion that alters with whomever you ask. It's definitely there, and it can be a real moneyspinner both at home and overseas. You may know it when you see it, but you'll never pin it down. Perhaps therein lies its allure.

By that stage the relationship with the agency can become damaged. It feels as though they’re unable to work to your agenda and maybe you need to try someone or something else.

It's our experience that maintaining a clear understanding of expectations between agency and client is made even more challenging by distance. If your service is delivered remotely, maybe in different languages, the situation can be exacerbated. If this sounds like you, what should you be doing to prevent things from going stale?

While changing your agency can seem refreshing, it could be a move that sets you back in terms of time and unnecessary effort. Your incumbent knows your business and knows you, but what they may not know is that what they’re working on isn’t giving you satisfaction. To be sure, it’s a question any good agency should ask every so often, yet appearances can be deceptive - it appear that everything is fine when in fact it is not.

The simple answer is to ask questions and help your agency partners in finding the answers:

Are we getting coverage in the right media?
Are the correct messages getting through?
Should we be looking at other activities?
How can you better support our sales staff?
What impact is activity having on our prospects?

We suggest making this process a quarterly task as part of regular reviews of communications planning. It doesn’t need to be an in-depth session – just asking the questions and acting as a team to giving the answers some thought is all that it takes.