Q: Can establishing a brand really help a developing
country to improve its market position and international
profile?
A: Yes, but only if it's true. The
first rule of nation branding has to be a long, hard look at the
reality of the country and asking a painful question: "To what
extent do we have the brand image we deserve?" If the answer is:
"Our image is out of date, unfair, biased" and we do something
about it, so that people want to visit, or invest or buy our
products or engage in cultural or political relations with us -
then branding can make an enormous difference.
Q: It still sounds like a tall order. Has anyone
been able to succeed, in your experience?
A: Very few poor countries. But it's
not usually because they lack money. It's because they spend it
unwisely. The biggest danger is people making naïve comparisons
between branding in the private sector and what it can do for
countries. There is a persistent belief that if a country can only
raise the funds and carry out a global advertising campaign like
Nike or Toyota, then overnight the country will fi nd itself with
the popularity and the profi tability of such companies. It simply
doesn't happen that way.
Building a global image
Q: How long does it take to build a global brand
image?
A: If you're talking about branding a
product and the product is good, if you have the distribution and
marketing, if you have the money - and it does cost money - then
you can start building a global brand within a couple of years. If
you are talking about the reputation of a country, it depends very
much from what base you are starting. If you are starting from a
strongly negative base, then I would normally say 15 to 20 years,
but things are changing so fast these days that it might be 10 to
15 years. If you are a transition economy, and things are going
pretty well for you anyway, it could be achieved in 5 to 10 years.
In all of these cases, the brand image is never changed by spending
huge amounts of money on logos, slogans and advertising campaigns
but by having a good strategy and investing in change. In the end
it comes down to creating a culture of innovation in the public and
private sectors.
Q: Can you point to some of the more interesting
developments in recent years?
A: In nation branding, the most
interesting thing is the speed with which the idea is catching on.
There is recognition that image may be one of the primary barriers
to economic development, but methodologies from the corporate
sector applied clumsily onto national development are extremely
dangerous.
Even the nation brand of a least developed country (LDC) can be
one of its biggest problems: many LDCs have a strongly negative
brand image which is constructed in some cases quite deliberately
by non-governmental organizations, for the very good reason of
getting as much aid into the country as possible. It doesn't matter
then how much money donors put into the country to promote it as
something else, because the overwhelming popular belief is that the
country is a basket case, and who would want to go on holiday or
invest money there, or buy its products?
Part of the problem is that the development industry suffers
from what I call the "better mousetrap syndrome", the belief that
if you build a better mousetrap the world will beat a path to your
door. It's simply not true.
What countries can do now
Q: Is there anything they can do
now?
A: We all know that the products which
succeed aren't always the best products. They are the products that
people believe in: in other words, the best brands. The product has
to be good, but that's not enough on its own. The brand has to be
as good as the product. Even professional investors make decisions
based on their hearts. But developing countries can't wait for
their reputations to catch up with the reality; that can take 30 to
50 years.
Countries can prepare a brand strategy that shows what their
image would need to be to achieve their economic and social goals,
and how to deserve that image. In this context, a brand strategy is
little more than a very focused and efficient way of doing
development. Unlike most development strategies, however, it bears
in mind that there is a marketplace out there that needs both
rational and emotional reasons for buying. A nation brand strategy,
as with most corporate brand strategies, makes decisions a lot
easier, and the speed with which you get results is much faster. It
ensures that you get payback on your investment.
But having a good brand strategy is not an easy thing to come
by, because it is not a question of a few people sitting in a room
and dreaming one up. It really has to come from the country itself,
from the people and from the institutions, its geography and
history and culture. Somewhere within that there is a correct
vision, a good brand strategy that will identify the country's
particular genius, a niche positioning which is theirs and theirs
alone, which guides how the country is going to compete in the
global marketplace. In the end that is down to good leadership. The
deeper you go into the subject, the closer it comes to conventional
statecraft. It depends to a great extent on having good leadership
with a good vision with the power to get the population behind that
vision.
Q: What then is Brand New Justice?
A: Branding is not what most people
think it is. It's not a superficial little marketing trick that
companies use to squeeze more value out of the marketplace. It's
actually an economic tool of critical importance. It is one of the
key creators and sustainers of wealth in developed countries. Brand
value accounts for nearly a third of all the wealth on the planet.
Brand New Justice asks: how come that tool is only
understood, only owned and only wielded by rich countries? Isn't
that one of the reasons why the gap is increasing between nations
despite all our efforts?
Executive Forum lessons
Q: What are the lessons you brought away from the
Executive Forum?
A: At the Executive Forum I was
surprised to hear so many countries debating their chances of
becoming a back office for companies in rich countries. I would
rather see outsourcing as a means to an end. It is a good way for
companies in poorer countries to earn revenue and at the same time
get an apprenticeship to learn how they can provide the services
themselves, and ultimately be the owners of the service brands
which supply the customer directly. This is the route to
sustainable prosperity, not remaining forever a faceless,
unbranded, low-cost, low-grade supplier to companies in the
northern hemisphere.
Q: In many cases the impetus is not going to come
from the government, though...
A: Good point. At the Executive Forum
we saw the example of two countries - Ecuador and Romania - where
the nation branding initiative started from the trade promotion
organization (TPO), with the aim of creating a powerful
country-of-origin effect. That is a powerful and perfectly
legitimate way of proceeding, and in many cases it is the only
politically expedient one. I seem to spend my life trying to
persuade heads of government and heads of state that it is their
responsibility to manage their national brand. If the TPO or Export
Board can show that branding is beginning to work, they can go to
the head of government and then get support for sharing their
learning with other sectors and get agreement on strategy at the
national level. And successfully branded exports can benefit the
country as a whole. If someone buys a good product or service from
one country they become statistically more likely to go on holiday
to that country, and if they go on holiday to that country they are
statistically more likely to want to invest in that country and
increase cultural relations with that country. There are very sound
arguments for linking this all together into a national
strategy.
Breaking down "Brand Africa"
Q: You have a "Nation Brands Index" . Why do you
want to start an African Nation Brands Index?
A: I have been doing the Nation Brands
Index since the beginning of the year. It takes in 25 countries. We
have a panel of 5 million consumers in 18 of those countries. We
basically test the world's perceptions of the 25 countries. We have
some developing countries in there just to see how they stack up
against the big-brand countries. I only have one African country in
there, South Africa. What I very much want to do - and sooner
rather than later - is to start to break down "Brand Africa" and
build a picture of what these countries do individually and what
people's perceptions are about them. The problem is that these
countries don't have an image of their own, apart from South
Africa. As I said before, they all have to share the brand of
Africa, and it's an incredibly unhelpful brand for any kind of
fruitful engagement with the rest of the world. The most successful
African states have to share their international reputation with
the least successful, a reputation composed of war, corruption,
disease, famine and poverty. The consequence is that even a
relatively prosperous and stable country like Botswana finds it
virtually impossible to get its message out. You get the same
"continent branding effect" in Asia and Central America. Most
developing countries don't have a lot to spend on research, so the
African Nation Brands Index could be a very useful public-domain
development tool, if we can find the funding for it.
Build your own brand
A Thai factory started to export its own branded garments,
making many times the profit it did when it manufactured for brands
in the United States. BeBe-Bushh children's clothing is now sold in
around a dozen countries.
- A chemicals company from Mumbai, India, is taking on the
Parisian fashion houses at the perfume game, and winning.
Well-to-do shoppers in Paris splash on Eau d'Urvâshi as fast as
Deepak Kanegaonkar can ship it.
- A Russian entrepreneur created a premium international
vodka brand and now wants to follow it up with banking services and
become Russia's answer to Sir Richard Branson. Russki Standard is a
super-premium vodka which retails in the Baltic republics,
Bulgaria, Greece, Hungary, Italy, the United Kingdom and the United
States, for at least 10% more than the market leader.
- A Czech furniture business, which markets itself with art, is
taking on the multinational giants. Techo UK's revenues rose to
nearly € 3 million a year after its founding, and its first
customers included the London branch of Accenture, the Royal Air
Force, the Financial Times and even Buckingham
Palace.
Source: Simon Anholt, Brand New Justice: How branding places
and products can help the developing world, Butterworth-Heinemann,
2005 (2nd edition).
Benefits of brand strategies
Branding, once the brand is established, should create an
increase in profitability and customer acquisition and retention,
so there's every reason to kick-start it early in the process - as
long as the products are good enough to sustain the brand promise,
of course.
Branding creates highly visible success stories which encourage
other companies to follow suit, more enthusiastically and faster
than they otherwise would. Brands are the rock stars of commerce,
and create many fans, both at home and abroad.
Branding creates expectations of product quality which the
manufacturer has to work twice as hard to maintain: this
accelerates the development of a first world-style approach to both
quality control and innovation. Putting your own brand name on your
products "raises the bar".
Examples of single companies in the West tend to show that the
companies that understand the importance of brand early on in their
growth - and practise it well and build their corporate strategy
around it - are often the ones which grow fastest.
Having a powerful brand - even if it is merely in strategic
form, without solid customer recognition yet behind it - makes
companies more powerful. They are perceived by investors,
competitors, suppliers and other businesses as more valuable, and
carry more weight in all kinds of negotiations. Potential value, if
it is clearly reasoned and intelligently planned, is universally
recognized as real value; strategy, creativity and ambition are
universally recognized as indicators of potential.
Source: Simon Anholt, Brand New Justice: How branding places
and products can help the developing world, Butterworth-Heinemann,
2005 (2nd edition).
Simon Anholt is a leading specialist in creating brand
strat-egies for countries, cities and regions. He is the author of
Brand New Justice: How branding places and products can help the
developing world. Natalie Domeisen and Peter Hulm interviewed Mr
Anholt for Trade Forum after he moderated the
session on branding at ITC's 2005 Executive Forum.