What does made in Germany mean to you?

As reported in Handelsblatt recently, there is a movement by the European Union (EU) Commission to enforce new regulations to more strictly govern the legal origin of goods and ultimately what qualifies a product to make the claim that it was made in a specific country. In Germany, for instance, the new proposal would mean that a ‘Made in Germany’ accreditation could only be attached to products if 45% or less of its components are of foreign origin.

These considerations are as rational as the circumstances that first led the ‘Made in Germany’ accreditation to be first recognised as a trademark indicating outstanding quality. However, to understand this fully we need to take a trip back to the 19^th century…

This was a time when steel made in England dominated the industry. Cast steel from Sheffield was seen as superior to the cast iron from Essen or Solingen and was coveted for its high quality. Many German entrepreneurs travelled to England to learn the secrets of cast-steel production and capitalise on this British boom industry.

But rather than increasing the quality of their goods, German producers merely slapped on a ‘Made in Sheffield’ label to their exports!  A canny trick, but rather underhanded and misleading. In 1887, English parliament responded by enacting an amended version of the Merchandise Marks Act, an act that called for the origin of a product to be transparent.  Goods made in Germany now had to be marked ‘Made in Germany’.

Luckily for Germany, in the time that it took to pass the law, the quality of German manufactured steel goods had risen and overtaken those of the English. ‘Made in Germany’ now stood for world-class quality—and not only for steel goods.

The industrial revolution marked the end of the feudal system, replacing it with strong national identities. These identities defined nations and were molded by the industry at their core: Germany became known for machinery (later automobiles). Italy became famous for fashion and furniture, and Sweden for premium steel.

Today, iPhones are made in China, BMW ‘X’ SUV’s are manufactured in South Carolina and Nike trainers are made in Vietnam.  So, is country of origin still as important today? Are consumers still concerned about where their products come from, or does the broader brand story hold more appeal?

I believe that we live in times where Brand Purpose and Promise are increasingly more meaningful to consumers than the location of a factory. As manufacturing is increasingly detached from innovation and design, is there an increasing call for more meaningful and relevant differentiation? Brands could choose to highlight the location of design or engineering rather than that of manufacture. Think ‘engineered in Germany’ (VW), ‘designed in California’ (Apple). What do you think drives consumers’ perceptions of value?

Ulf-Brün Drechsel is executive director, EMEA for Siegel+Gale.

Read the German version of this blog.