But by the 1980s, sales of classic brand-name goods like Tide, Levi’s, and Marlboro had begun to falter. The problem seemed to be that the market was flooded with nearly identical products and, with the economy in recession, many were making decisions based on price, not brand name. The old tricks—billboards, TV ads—didn’t seem to be working anymore; it was as if consumers had built up some sort of resistance. (Or, as ad executive David Lubars memorably put it, consumers “are like roaches—you spray them and spray them and they get immune after a while.”)
At around this same time, a new kind of corporation began to rival the traditional all-American manufacturers for market share. These were the Nikes and Apples and, later, the Tommy Hilfigers and Starbucks and so on. These pioneers had a different model: Create a transcendent idea or brand surrounding your company. Use it to connect with consumers who share its values. Then charge a steep premium for products that are less about the objects themselves than about the profound human desire to be part of a tribe, a circle of belonging.
So when kids lined up all night to buy $250 Nike sneakers, they weren’t exactly buying the sneakers; they were buying the idea of “Just Do It” and the dream of Michael Jordan, who had become a one-man Superbrand, a term first used to describe the athlete’s growing empire. When their parents bought Apple computers, they were bringing home a piece of a deeply optimistic vision of the future, captured in the slogan “Think Different.” (The aura of authenticity increased with each revolutionary and artistic icon, living or dead, whose face graced the campaign: Gandhi, Martin Luther King, Picasso, Mandela, the Dalai Lama.) And when commuters were suddenly paying four times what they used to for a cup of coffee, it was because Starbucks wasn’t really selling coffee; it was selling, according to its CEO, the idea of the “third place,” not home, not work. (The third place used to be actual community spaces where people would gather without the help of corporations, but those spaces were fast disappearing.)
Another key development in this period was the notion that, since the true product was the brand, it could be projected onto any number of seemingly unconnected physical commodities. Ralph Lauren launched a line of paints, Virgin went into wedding dresses and colas, Starbucks had a line of jazz CDs. The possibilities seemed endless.
Many of these highly branded companies made the (then) bold claim that producing goods was only an incidental part of their operations, and that, thanks to recent victories in trade liberalization and labor law reform, they could have their products produced for them at bargain-basement prices by contractors and subcontractors, many of them overseas. It didn’t really matter who did the physical work, because the real value lay not in manufacturing but in design, innovation, and of course marketing.
A consensus soon emerged at the management level that a great many corporations that did not embrace this model were bloated, oversized; they owned too much, employed too many people, and were weighed down with too many things. The old-fashioned process of producing—running one’s own factories, being responsible for tens of thousands of full-time, permanent employees—began to look less like the route to success and more like a clunky liability. The goal was to become a hollow-brand—own little, brand everything.
Pretty soon, multinationals were competing in a race toward weightlessness: whoever owned the least, had the fewest employees on the payroll, and produced the most powerful images as opposed to things, won the race.
No Space, Few Jobs
The meteoric rise of this business model had two immediate impacts. Our culture became more and more crowded with marketing, as brands searched out fresh space and new “brand extensions” with which to project their big ideas and reach their target markets. Work and workers, on the other hand, experienced a sharp discounting and were treated as increasingly disposable.
Brands like Nike and Adidas competed fiercely in the marketing sphere, and yet they manufactured their products in some of the same factories, with the same workers stitching their shoes. And why not? Making stuff was no longer considered a “core competency.” Head offices (now increasingly being called “campuses”) wanted to be as free as possible to focus on what they considered the real business at hand: creating a corporate mythology powerful enough to project meaning onto pretty much any object, simply by stamping their brand on it.
In the press, this phenomenon was often reported as Company X or Y deciding to move their factories to a part of the world where labor was cheaper. But as I found when I visited sweatshops producing name-brand goods like Gap clothing and IBM computers in Indonesia and the Philippines, the truth was somewhat different. In most cases, these companies were not moving their factories in North America and Europe and reopening them in Asia, but rather closing them down and never reopening them, anywhere. This period saw a proliferation of very complex supply chains, where it became increasingly difficult to sort out where a product was being produced and by whom. It also saw a wave of scandals: again and again intrepid investigative journalists and labor groups would reveal that, say, a Michael Jordan–branded Nike shoe or a Disney-branded t-shirt was being made under horrific sweatshop conditions in Haiti or Indonesia. But when journalists or consumers tried to hold the brand accountable, the company would almost invariably declare, “We’re as horrified as you are. Which is why we’re going to stop doing business with that contractor.”
It’s no secret why this model took off. If you did it right—if you made beautiful commercials, invested heavily in design, and tried to embody your brand identity through countless sponsorship arrangements and cross-promotions—many people were willing to pay almost anything for your products. Which is why the success of what came to be called “lifestyle brands” set off a kind of mania, with brands competing with one another over who had the most expansive network of brand extensions, or who could create the most immersive 3-D experiences—chances for customers to crawl inside and merge with their favorite brands.
So what does all this 1990s history have to do with Donald Trump? A great deal. Trump built an empire by following this formula precisely. And then, as a candidate, he figured out how to profit from the rage and despair it left behind in communities that used to do the kind of well-paid manufacturing that companies like his long ago abandoned. It’s quite a con.
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