I have spent years advising American companies on entering the European market. They arrive with a brand and a marketing system built entirely around the American consumer, and they assume it will work again on a different continent without adjustment.
The first thing I do with a new client is explain, in detail and entertainingly, what separates the two markets, with nice anecdotes. An American marketer or salesperson has the cultural variables of their home market under control; where that knowledge runs short, a strong and stable willingness to spend covers the gap. Europe has not agreed on a common language or a common culture. For a marketing or sales department, that diversity is a nightmare. Gender questions are not the only ones that vary by country; laws and consumer habits do too. A campaign that works in France can fail in Germany. Little of what works in one market moves cleanly into the next.
I explain all this at length, and mostly it doesn’t change anything. By the time a client sits down with me, the decision to expand has already been made. Budgets are fixed. Consulting executes the decision instead of testing the premise behind it. Dollar signs are already in the client’s eyes. The numbers behind the decision are a population roughly comparable to America’s own and purchasing power that looks solid on a spreadsheet. The one open question left is how to get around the taxes, which in Europe tend to be high and complicated.
A pattern repeats. Revenue projections and EBITDA, generously extrapolated, turn directly into a picture of enormous net profit in the client’s head. Any objection reads as pessimism. The client treats whatever contradicts the picture as irrelevant. Thinking first and deciding second does not happen, because it would mean questioning the one assumption nobody wants to give up.
The motive behind the expansion is usually the same. The American business is running well, so the company reaches for Europe as free scaling, since the marketing system is already built. The company ignores that a large share of that American revenue is synthetic: switch off a marketing channel, or cut its budget, and revenue drops immediately while fixed costs stay put. Against that backdrop, the jump across the Atlantic looks like a natural next step, territorial expansion at low marginal cost, because the setup work is supposedly already done. Clients rarely see that the logic underneath this was wrong to begin with.
Some clients then try to run trade relationships, pricing and marketing channels in Europe the same way they had run them at home, on the assumption that any consumer can be bought at the right price. In their hands, that control slipped in Europe the same way it had already slipped in the US.
My own approach was different: reasoning and logic, with simple strategies everyone could agree on. And they listened. How well the strategy worked depended on the client’s willingness to listen and learn. One thing stood out consistently: decision makers listen, while specialists rarely move out of their US cosmos or dare step onto foreign ground.
The quality of a decision depends of course on the quality of your data, but even more on whether you are willing to fundamentally question your own assumptions when new facts come in. Data will always confirm what you already want to see, if you look at it from one angle only and ignore the rest. American companies expanding into Europe decide first and examine the continent only afterwards. By the time anyone tests the assumptions, the money is already committed to executing the American marketing system in Europe.