Branding Cuba: La Vida Nike
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Face it -- America is obsessed with its communist island neighbor to the south. Since its revolution in 1959, Cuba periodically takes center-stage in the American psyche. Take this month for instance. In preparation for Jimmy Carter's long-anticipated visit to the island, George W. Bush, with great media fanfare, inaugurated Cuba into his "Axis of Evil." A week later, Carter made history as the first American president, sitting or former, to visit the island since Calvin Coolidge.
With Carter came the American press corps, agog with a freshly invigorated curiosity. Once again the land of Che Guevara, Fidel Castro and Elian Gonzalez is lighting up television screens across the American heartland and once again the American media is examining our relationship with our island neighbor -- only now, a main focus is on when, not if, the United State will reestablish trade with Cuba.
My experience in Cuba tells me the media is behind the curve. American businesses have already established a beachhead and are impatiently waiting to break from the starting gate in a race to stake a claim in a new consumerist Cuba. The Cubans, for their part, won't know what hit them.
My first trip to Cuba was in 1987; a university-sponsored sojourn to the forbidden island "behind the iron curtain." My odyssey began at the Toronto Airport as I boarded a vintage Russian-made IL 62. The plane, prohibited from flying over the U.S., headed to the Atlantic Ocean and then made a sharp right turn, depositing us in Havana's Jose Marti airport at about midnight. I looked out the window at the dimly lit terminal, expecting to see troops, perhaps statues of Lenin. What I did see was the biggest Visa Card that I had ever seen, above the words, "Welcome to Cuba." So much for communism.
Upon leaving the airport, however, we saw no more Visa billboards. Actually there were no billboards touting any product other than the official "revolutionary" ideology of the communist party. Cuba was still a rare advertising- and commercial-free zone. Its stores were filled with generic products. Its culture was yet to be branded.
At the time I didn't appreciate how rare this ad-free experience would prove to be. The following year, as a journalist based in Costa Rica, I hiked deep into the highlands of Guatemala, looking to escape American corporate culture. But alas, a half-day's walk beyond the last electric wires, in "guerilla" territory, beyond the reach of government, Coca-Cola and Pepsi were still slugging it out, with Coke reigning supreme. Malnourished campesinos would spend a day's wages for a warm bottle of Coke, el sabor de la vida Norte Americano.
Cuba was different. Havana is one of the world's most vibrant cities, yet it didn't have a single commercial billboard. People began to travel to Cuba for the sole purpose of experiencing a landscape free of commercial clutter.
Rebellious Cuban youths would scrawl the names of U.S. and British rock bands onto walls and into fresh concrete as symbols of resistance to state-controlled media. Next to them were peace and anarchist symbols and English words such as "punk" and "metal," dangling devoid of context. That was 14 years ago.
Today all this graffiti of resistance seems to have morphed into one symbol, the omnipresent Nike swoosh. It's not just on walls and in the cement, but embroidered by hand onto shirts and hats, stenciled onto car windows and on the backs of Chinese-made pedal-cab bicycle taxis. La Vida Nike has taken Cuba by storm. American culture -- in essence corporate consumer culture -- has established a citadel in Cuba and seemingly is there to stay.
The Swooshification of Cuba
But let's back up. Cuba became commercial free when its government nationalized most foreign businesses in the early 1960s, establishing a so-called communist economy and earning the ire of eight successive U.S. presidents. The Havana Hilton was de-branded and re-christened the Habana Libre. United Fruit and Meyer Lansky's crime syndicate were both driven from the island. The U.S. State Department, ever quick to protect foreign investments, isolated Cuba with a comprehensive economic embargo that exists intact to this day.
U.S. citizens cannot travel to Cuba, trade with Cuba or invest in Cuba. What was supposed to financially starve the Cubans into submission instead pushed them into the fold of the other economic force on the planet, the Soviet Bloc.
Being shunned by the global capitalist powers for a generation, however, really didn't hurt Cuba. Instead the embargo allowed it to develop into something unique. Without easy access to Western banks and development loans, for example, Cuba evaded the debt crisis that has been crippling the economic development of almost every other Third World country in the hemisphere. Likewise, without the abundance of a consumerist society bestowed upon one small segment of the population, Cuba escaped the criminal culture that follows alongside inequitable distribution of wealth.
The proverbial shit hit the fan, however, in 1989 with the breakup of the Soviet Union and the destruction of the Eastern European economic bloc, Cuba's primary trading partner. Suddenly Cuba was without oil, spare parts for vehicles, and also without a market for its major exports such as sugar. Thus began the "special period." Resourceful Cubans welded old Eastern European busses together into massive trailers, each holding 300 passengers and pulled by South American Ford truck tractors.
Today Cuba has adapted to the special period not only with mechanical ingenuity, but with economic compromise as well. Cuba, once again, is open for business and courting capitalist investment -- on its own terms. The government remains a 51 percent partner in most major enterprises on the island. Investors are happy with these terms since they are basically investing in an island-wide monopoly. Without the competition of a free marketplace Cuba offers firms such as Spain's Sol Melia hotel chain, a company that controls one third of Cuba's upscale hotel rooms, a safe predictable business climate. Currently the European Union and Canada have replaced the Soviets as Cuba's primary trading partners.
All that's left of the Russians, Cubans are quick to point out, are rusting Lada cars and a host of hideously ugly hotels and apartment complexes, remnants of Soviet-era development and aid projects.
And with the capitalists back in town come the billboards as Cuba is once again adorned with multinational corporate "art" touting a consumerist message.
With a 5.6 percent economic growth rate, Cuba's economy is booming, to the benefit of Cuba's leaders who are forever pleased to thumb their noses at their American tormentors, and also to the profit of international investors who are reaping big returns from Cuba's mixed economy. Left out of this party are Cuba's closest neighbors, American businesses still forbidden to trade with the "enemy."
But they're establishing their beachheads now, preparing for the coming commercial invasion of the island. The lure is too strong. Cuba provides vast unbranded spaces. Compared to the advertising saturated developed capitalist world, Cuba is an advertising-ready environment -- a blank canvas.
The ever-present Nike graffiti is all cultural spillover from the U.S. It's not Nike that Cuban rebels are celebrating; it's a romanticized view of American capitalism, with the Nike swoosh as its most visible logo. It's on the clothing their gusano relatives send from the States. It's branded all over tourists. It's on the clothing tourists gift Cubans with at the end of their weeklong sojourns.
Young Cuban rebels have adopted the swoosh in much the same way late Cold War-era American youth adopted Mao caps and CCCP logo gear. It's similar to the use of the Nazi swastika by the 1970s punk movement in the UK -- flirting with the enemy; upsetting the establishment.
Unlike Mao caps, CCCP gear and swastikas, however, the swoosh is property. It's a brand. In Cuba it's currently controlled by the Spanish corporation Cidesport S.A.
In Cuba, where the average monthly wage is less than $21U.S., Cidesport sells Nike footwear for $30-70U.S. For the vast majority of Cubans, actual Nikes remain an elusive commodity. For a small minority, the nuevo riche, Cubans who receive money from abroad or who work in the tourist industry and receive tips in U.S. dollars, Cuba's new preferred currency, Nike products are now available.
The products often come from so-called "communist" countries, China and Viet Nam. A Spanish company sells them to Cubans who spend a comparable fortune to obtain them. They cost considerably more than other comparable Chinese and Vietnamese products, with the markup being split between Cidesport and Nike. Nike produces nothing. They simply own the swoosh.
Cuba, with a population of 11 million, presents both a market and virgin territory for branding. The lure is strong and multinational corporations are jockeying for a piece of Cuban culture. While the front door is closed, however, the back door is wide open. U.S. law prohibits small business from trading with Cuba, yet brand-name American products are now omnipresent in Cuba. Tourists are chauffeured about in Ford and Chrysler vans. Restaurants now serve Coke and Budweiser. Stores sell Marlboro, Winston and Lucky Strikes.
The U.S. State Department, while rhetorically committed to its arcane embargo, also recognizes the potential of the Cuban market. Under pressure from U.S. based corporations, it has been punching big-business friendly loopholes through its own regulations. Starting in 1995, for example, the Clinton Administration allowed U.S. corporations to spend money in Cuba registering trademarks with an eye toward securing a foothold in the Cuban market. To date, brands such as Hard Rock Cafe, Nutrasweet, Heinz, Gillette, Sbarro, Clairol, Radisson, Coca-Cola, McDonald's, Warner-Lambert, Calvin Klein, Playboy, DirecTV, Alamo-Rent-A-Car, Conagra, Zippo, MCI, Sara Lee, Monsanto, Pizza Hut, UPS and Wrigley's gum have all stepped up to the plate, registering their Cuban trademarks.
The Cuban government has a keen sense of branding and has been taking advantage of its headstart in its own market by branding government-run businesses with corporate-style logos and names. By doing so it has created its own identifiable brands and staked out its own share of the developing Cuban market.
The government began branding in the 1980s by creating names and logos for the upscale state-run dollar stores and restaurants patronized by foreigners. Cubans, who were not allowed to possess dollars until the mid 1990s, were denied access to these businesses. The branding, however, still imprinted upon the population as they peered through the windows with envy, watching tourists buy luxury goods. The tourists themselves became billboards, living props branded by the logo emblazoned shopping bags they toted around Havana. When a tourist discarded a logo bag, Cubans would rush to retrieve it from the trash and then carry it around with pride as a status symbol.
Today these stores are now present throughout Havana, with Cubans being their primary market. Hip and branded, the stores compete effectively with black marketees, vacuuming dollars out of the Cuban economy and back into the hands of the government. Cubans I spoke with often recommended I eat at a Rumbos restaurant, part of a mock chain of grocery shops and fast-food outlets trusted by Cubans for providing the uniform quality they assume tourists would expect. "The chicken is good, it's Rumbos." Also popular are the government-run El Rapido and Burgui (based on the Burger King model) fast food chains. The Cuban government has also created its own brands of gasoline: Cupet, Cimex and Cubalse.
Cuban-run government businesses are also practicing co-branding with experienced but small foreign chains. One government-run enterprise, for example, recently entered into an agreement with Pizza Nova, a Toronto restaurant chain similar to the multinationally branded Pizza Hut, to operate a chain of Cuban Pizza Nova outlets. Currently, with a Pizza Nova meal costing 10 to 20 times the price of a meal at other Cuban pizzerias, Pizza Nova is in effect a forbidden fruit, with locations only in posh tourist zones. They are well positioned, however, to eventually replace many cheaper pizzerias and to compete effectively with new entries from foreign multinationals. With a state-controlled media, Cubans will have Pizza Nova imprinted upon their culture years before seeing their first seductive Pizza Hut ad.
With proven successes at home, the Cuban government is taking its branding experiment abroad, in effect taking on the multinational branders in their own backyards with their own game. Cubanacan S.A., the Cuban government-owned operator of Cuba's Pizza Novas, in conjunction with the government-owned Gran Caribe S.A. hotel chain, is currently planning to open Cuban cuisine restaurants in Brazil, China, France, Italy, Mexico and Spain, where a licensed branded Cuban Tropicana nightclub has existed since 1994.
Advertisements for embargoed Cuban goods have also started appearing in the U.S. press. The July 2000 issue of Forbes and the spring 2000 issue of Ritz Carleton magazine both featured ads for Cuban cigars that are currently illegal in the U.S. The July 2000 issue of Conde Nast Traveler and the June 2000 issue of Cigar Aficionado featured ads for travel to Cuban resorts.
Cuba's overseas branding experiment, however, is miniscule compared to the interest multinationals have in branding Cuba. Currently over 110 U.S.-based businesses, almost all of which are multinational corporations, are licensed by the U.S. State Department to do business in Cuba. The list includes Alcoa, AT&T, Corning and Owens Corning, Coleman, Champion Spark Plugs, Del Monte, Dow, Dupont, Lilly, Exxon, Ford, GE, Goodyear, GTE, Bridgestone Firestone, Honeywell, Johnson & Johnson, Litton, Monsanto, RCA, Raytheon and Upjohn.
The Cuban government, still desperate for dollars, has thrown the door open to foreign investment, inviting in some of the very corporations that have been previously vilified for decades in the Cuban media. Cuba is an original signatory to the GATT Treaty and is a member of the WTO. Both GATT and the WTO guarantee branding rights and protections to foreign investors.
With the door ajar, but not quite open for U.S. citizens, U.S. businesspeople are flocking to Cuba. In 1994, 500 U.S. business executives traveled to Cuba "on business." That number increased three-fold to 1,500 in 1996, to 2,500 in 1998 and to 3,400 in the year 2000. Dollar stores in Cuba currently sell, among other brands, Campbell Soup, Heinz, Del Monte, Libby's, Kraft, La Choy, Bumble Bee, Progresso, Planter's, Hellman's, Gerber, Uncle Ben's, Motts, Ragu, Tabasco, A-1, Vlasic, Purina and Mars. The Pepsi and Coca-Cola brands had a monopoly on the diet soft-drink industry in Cuba until 2000 when Nestle entered the market.
AOL Time/Warner executives recently traveled to Cuba to discuss both the import and the export of TV programming and movies. Business leaders and politicians from Illinois and Georgia recently visited to explore business opportunities such as introducing the Churches and Popeye's Fried Chicken and Cinnibons brands to the island. Executives from Daimler-Chrysler recently won a $200 million contract to provide busses to Cuba.
The year 2000 saw the "U.S. Healthcare Exhibition" in Havana. Companies marginally in the healthcare business promoted brands such as Eastman Kodak, Kimberly-Clark, Kendall, Monsanto and the Proctor & Gamble family of brands. Cubans lined up for free samples of Vicks lozenges.
Currently, Marlboro Cigarettes typifies Cuba's branded future. New York-based Philip Morris Companies (newly re-named Altria), Marlboro's parent corporation, is conducting Cuba's most successful branding experiment. Using techniques ranging from a sophisticated display at Havana's Food and Beverages International Trade Fair, to the distribution of its omnipresent branded ashtrays in Cuban restaurants, Philip Morris has boosted Cuban Marlboro sales to between four and five million packs per year.
Despite equivalent wholesale costs, Lucky Strikes sell for $1.50 per pack, Winstons sell for $2.00 per pack and Marlboros sell for $2.50. By comparison, Cuban cigarettes, in a country renowned for its tobacco products, sell for 50 cents a pack.
The U.S. Cuba Trade and Economic Council reports that Marlboro cigarettes are usually difficult to find in Cuba as they tend to sell out, even at these premium prices where an average weekly salary buys two packs, as soon as they are displayed. Other brands, they note, are always available.
When it comes to branding Cuba, Nike and Marlboro are the clear champions. They've commidified American ideals of rebellion and individualism and packaged them for Cuban consumption. What the Cubans get, however, is neither revolution nor individualism, just conformity and a return to pre-revolutionary corporate domination.
Michael I. Niman is a professor of American studies at Medaille College in Buffalo, and author of "People of the Rainbow: A Nomadic Utopia" (Univ. of Tennessee Press).