Many companies identify their country of origin in their brand name. American Airlines, U.S. Steel, and Bank of America are just a few examples. But, does having the word “America” in a brand name help or hurt the brand’s global expansion strategy?
This is the question that a U.S. healthcare provider faces as it prepares to expand into Southeast Asia.
The company’s brand name includes the word “America,” and the firm enjoys high brand awareness and a favorable brand image among consumers in the U.S. It is also highly regarded among a wealthy elite of foreign patients who travel to the U.S. to receive treatment at one of the company’s facilities.
As the company prepares to expand into new countries, however, it is concerned that its global expansion efforts might be stymied by the inclusion of its country of origin in its brand name. Could the word that has helped the company develop a prominent brand presence in the U.S. also hinder its vision for global expansion? Here are several issues to consider when including a country of origin in a brand name.
How do customers in other countries perceive the home country and its brands?
How is America viewed around the world? In some Western European countries, a brand carrying the name “America” might fare pretty well. In North Africa or the Middle East, there are probably more negative feelings at the moment. However, it is not just customers’ attitudes toward the country in general that matter – it is also important to consider the country’s reputation in the brand’s industry.
In the healthcare industry, America has the best reputation in the world. There are some negative aspects, too: American physicians are perceived as cold and impersonal, and they treat patients like numbers. However, there is no doubt in the minds of Southeast Asian patients that American healthcare facilities offer the best medical care in the world. Therefore, having “America” in the brand name could be a benefit, even in foreign markets.
How do customers in other countries perceive their own country and its brands?
It may seem counter-intuitive, but many people around the world might harbor negative attitudes about the ability of their fellow countrymen to make valuable products or provide adequate services in some industries. Healthcare is one of those industries, at least in some countries. Many people in Southeast Asian are very unhappy with the medical care options available to them in their own country. In contrast, they view the U.S. as the gold-standard of medical care, with the highest-skilled physicians using the most advanced, cutting-edge techniques to cure disease. For these prospective patients, it is a no-brainer: they would prefer an American healthcare brand over any local-country provider.
How would entering a new country change the brand’s image?
It seems like the word “America” might help this company more than it might hinder it when expanding into Asia. However, the company should also consider how its brand image might change when it actually enters the new market. Sure, it has the word “America” in its name. But, will the new hospital be staffed by American physicians (which would be great!), local physicians trained by and conferring with American doctors (might be okay), or the same poor-quality physicians patients currently encounter in their local country? The benefits of the brand name’s promise may quickly be lost if the company doesn’t provide the quality of care that patients associate with American medical facilities. And such brand dilution could hinder the company’s subsequent expansion opportunities. Living up to its brand name’s promise can help the company increase its chances of successfully entering a new country, and also facilitate continued expansion in the future.
In this case, the company’s use of “America” in its brand name seems to be a net advantage for its global brand expansion efforts. But, not all brands would benefit from a similar country-name advantage. The success of such global expansion depends on the country identified in the brand name, attitudes toward that country in the local market, and the company’s ability to deliver on its brand promise over the long run.
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Dr. Justin Anderson
Vice President
MMR Strategy Group