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Jun 1, 2008 12:00 PM, Larry Jaffee

51st State?

Irish-born English dramatist George Bernard Shaw once quipped that “England and America are two countries separated by a common language.”

Today, however, similarities abound between the two nations — at least in terms of the promotional marketing industry. It was impossible to walk a main thoroughfare during an April visit to London without finding placard-wearing street teams. They were hawking the latest Hollywood film, or the Starbucks, KFCs, Burger Kings, McDonald's, Banana Republics or American Apparels that seemed to be on every corner.

Despite all the familiar brands, it was enough to make an Anglophile wince, especially with the poor dollar-to-pound exchange rate (£1 = $2). Clearly, the Yanks' recession at home is responsible for all the commercial development abroad.

The so-called “special relationship” forged during the Reagan/Thatcher years (and continued during the “Cool Britannia” Clinton/Blair era) today resembles no less than a U.S. annexation of the U.K., the proverbial 51st state.

Marketers queried at the third annual Promotional Marketing Exhibition in London in April saw consumers on both sides of the Atlantic as basically the same in terms of what motivates action to an offer.

Several of the conference sessions focused on the immediacy, reasonable cost and trackability of interactive media.

A recent online promotion by American-born Gillette razors for British pharmacy chain store Boots resulted in a redemption rate of 18%, with 150,000 samples gone within 48 hours, reported panelist Alex Lloyd, joint managing director for U.K. interactive agency Haygarth Group.

American marketing innovation was cited by her co-panelist Hugh Robertson, managing partner of the U.K. experiential agency RPM: “Henry Ford pioneered the test drive in the 1930s,” he said.

‘You Remind Me of Hugh Grant’

Their co-panelist and fellow Brit Jonathan Clow, of the newly formed U.K. promotions agency BD-NTWK, spent 18 months working in Chicago for The Marketing Store on the global McDonald's account. For his first few years with TMS, he was based in London.

“I gained so much experience,” he told Promo of his American sojourn, which was cut short for family reasons. Back home, he joined BD in London in February 2007 to head up its Coca-Cola Enterprises team.

While stateside, Clow quickly picked up on the cultural differences in the workplace.

“The American way is, ‘This is what I want, and I will fight tooth and nail for it,’” he said.

Clow admired the directness of his U.S. colleagues and sensed more emphasis on teamwork than what he encountered in Blighty.

“I could get away with a bit of British charm,” he said, meaning many Americans could be swayed by his accent. While remaining professional at all times, he saw it to his advantage to play the Brit card occasionally. “They'd treat me as if I were Hugh Grant,” he said, somewhat abashed.

Not all expats enjoy living and working on the other side of the Pond as much as he did.

“Some of my colleagues came back and said they didn't like it. For me, the quality of life was much better [in Chicago] than in the U.K. I miss the camaraderie and teamwork,” Clow added.

Eyeing the U.S. Market

Among the 200 or so exhibitors on the PME floor were some that hailed from the U.S., including Zagat, Sony Electronics & Music and Marriott.

But most were U.K. or mainland European companies selling customizable goods for premiums and incentives or various services for marketers.

Many already do business in the U.S., or wish to do so. For example, Prodir, which manufactures promotional pens that are distributed to 50 U.S. customers, has a sales office in Rhode Island. In 2007, the company sold 1.5 million pens in the U.S., compared with 80 million worldwide, noted the company's managing director Rod Duncan.

Procurement, a 27-year-old British distributor specializing in promotions and rewards fulfillment, took on its first U.S. customer, IT firm Siebel, five years ago. It's now looking to expand its American client base.

“Fortune 500 companies need a strategy for Europe, the Middle East and Africa,” said Ian Rosewell, Procurement's managing director.

Pace Network, a fulfillment company based in Holland, is also eyeing the U.S. marketplace, reported its director Tom Doll. Pace has a big U.K. operation near Heathrow Airport.

Risk management, which provides financial protection when, for example, promotion redemption requests are greater than expected, was also represented on the show floor by U.K. firms PIMS-SCA and its competitor Fotorama. Both serve the U.S. market.

Initially established as Promotional Insurance Management Services in 1987, PIMS was acquired in 1999 by SCA Promotions, a U.S. provider of promotional risk protection to many Fortune 500 companies. Together, PIMS-SCA and SCA have covered more than $16 billion in prizes and paid out more than $140 million in insurance claims.

Fotorama has handled fixed-fee risk management for such U.S. brands as Pizza Hut, Best Buy and Pfizer's Listerine, and counts among its clients Coca-Cola, Buena Vista, GlaxoSmithKline, Unilever and L'Oreal.

Potholes in the Global Marketplace

With the economy being what is, American companies are looking overseas for expansion opportunities. One would think that the European Union would provide something of a one-stop shop, but the opposite is true.

The cultural and language differences among its member nations are a significant reason. And in terms of the law, it's a confusing maze of contradictions — the subject of another PME conference session.

Although the EU was supposed to standardize practices, that did not happen, noted Margot Parker, a consultant with the European Business Consultancy, and also spokeswoman with the British Promotional Merchandise Association.

Her co-panelist Philip Circus, a lawyer with the Marketing Law Advisory Service, noted that a term as simple as “free” poses problems from country to country. He advised marketers to “be clear [and use] words accurately and unambiguously. Understand the environment where the promotions are running.”

For example, in Britain an offer can be “free” if it requires that one item be purchased, and there's no charge for the second.

“There's a vast, different view of how that can be interpreted,” Circus explained. “The British government feels that there can be a product-purchase requirement. But in many European countries there's no such thing as ‘free.’”

Meanwhile, there's “inadequate law enforcement. … [Nations] turn a blind eye. And until there's a case in court, the ambiguity maintains the status quo,” Circus said. “According to the 1957 treaty in Rome, there was supposed to be a common market. We don't even have one.”

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