Jun 20, 2017

The Fourth of July is rapidly approaching. Time for retailers to line their shelves with patriotic goods and apparel. But check the label; it’s likely that stars and stripes T-shirt you grabbed wasn’t made in America.

Maybe that’s not shocking. We’ve become accustomed to seeing all types of iconic American products bearing “Made in China” or “Made in Indonesia” labels.

However, American consumers are also becoming increasingly educated about the companies that make the products they purchase, and that includes where the products were made.

Moreover, thanks to the recent wave of populism that has swept our nation, promoting products as “Made in America” is becoming an increasingly popular marketing strategy.

But in our global economy what does “Made in America” really mean? American-born Breakout Brands like Apple and Nike are headquartered in the U.S., yet they have almost no manufacturing presence on our shores.

Conversely, many foreign-based companies have invested heavily in manufacturing in the U.S. Toyota Motor Corp., Hyundai, Kia, Nissan and Volkswagen AG recently teamed up for an ad campaign to highlight how they manufacture nearly half of all vehicles produced in the U.S. and have invested some $75 billion in the U.S. to date.

The somewhat controversial ad borrows from Ronald Regan’s famous “Morning in America” TV spot. It notes how, thanks to trade and open markets, the American auto industry is “stronger, prouder and better than ever before.”

So, which is the more American product: The GMC Terrain made in Mexico or the Toyota Camry made in Kentucky? And where should marketers draw the line when promoting a product as “American”? It seems both are tough questions to answer.

Budweiser received a lot of criticism for its Memorial Day-focused marketing campaign that replaced “Budweiser” with “America” on the label of special limited-edition, military-inspired camo aluminum bottles available through July 4.

It seems the campaign has upset many of the active and retired military members it was trying to honor. The negative reviews are mounting despite a charitable component that provides up to $1 million of the proceeds of the sales of the limited-edition bottles to a military philanthropy, Folds of Honor.

This may come as a surprise, since Budweiser was employing the proven Breakout Brand strategy of seeking an emotional connection with their customers. The angered parties point to the fact that Budweiser is no longer an American company. Its parent company, AB InBev, is primarily based in Belgium. While Budweiser still employs thousands of Americans, most of the company’s profits go overseas.

Perhaps the approach American Apparel is taking following its acquisition by Canadian-based Gildan Activewear Inc. will become a best practice. Trying to stay true to its domestic-manufacturing roots, this summer American Apparel will give online shoppers the ability to choose where they want their garments made. Consumers will have the option to pay less for items made overseas, or opt for U.S. production for up to 25 percent more.

It will be interesting to see how much price drives American Apparel customers’ purchasing decisions, and by default how much marketing something as “Made in America” is truly worth.


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