Branding Cities for Tourism

Branding Cities for Tourism INTRODUCTION In the times that we live in, everything from products, services, people, to places are branded. This is no more an interesting marketing technique, instead the need of the hour today. While there are some critiques of the concept, Place Branding is becoming a well accepted theoretical development by marketing gurus in the world. The days where the big cities used to compete with one another for placing headquarters of multi-national companies are gone. To a great extent, this paradigm shift can be attributed to technological advances and lowering of regulations across the world. Therefore, cities can now carve their own niche for a separate value proposition they have on offer. A great deal of research has been conducted on the concept of city branding; some of the identified requirements for city branding are leadership, strategy and creativity. It is important to admit that a city is widely different from a product, yet has its set of similarities. The greatest point of distinction is that a city is a single product, which can be multi-sold. Therefore, it is imperative that a city defines its target segments clearly. In broad terms, the customers for a city are people who live there, i.e. a citys inhabitants, people who create job there (the creative class) and people who stay there (contribute to the city through tourism). A city cannot function without its people, who form the stakeholders for the city. A city branding exercise to a great deal is driven by the concept of leadership. Leadership includes a citys citizens, government authorities, private and public companies, institutions, etc. The key to city branding is that there is no hierarchy in the organizational structure for a citys leadership board. They all are equal partners, who take strategic decisions together, implement it as a group and therefore, enjoy the benefits or bear the risks equally. In order for a city to be a good brand, the city should have distinctive, differentiated characteristics, which can be easily identified by the target group. A city branding exercise requires a city to have certain basic characteristics, without which branding cannot be successful (Winfield-Pfefferkorn, August 2005): The city must offer attractive employment opportunities The purchasing power of the citizens should be reasonable It should provide reasonable living conditions The public transport system should be in place Education and recreational facilities should be present Branding, if executed well has the capability to infuse life into the city. It has a direct bearing on the work of urban and economic planners for the city. The key is to identify the promise of a value that a city has, i.e. what is it that the city offers which can keep the businesses, institutions and residents attracted and interested in the city (Gelder Roberts, Branding Bring Life to a City, 2006). In case of city branding, the role of branding is not just strategic or visionary in nature. The value of the brand is built at every point of contact with the consumer through the experiences that the consumer has at that point. Therefore, relying only on the physical characteristics of the place is not enough. It is each experience which defines the image of the city in the consumers mind (Baker, 2007) Therefore, the process of city branding is interesting albeit very complex in nature. There are no one-size-fits-all phenomena for city branding. Each citys stakeholders need to think individually about their city and identify the differentiating characteristics, the strengths and weaknesses and the areas which need work to execute a meaningful, strategic city branding process. LITERATURE REVIEW DECIPHERING: CITY BRANDING In the competitive age today, almost nothing has a strategic competitive advantage. Therefore, the cities as well are competing with one another for attention, tourism, talent, events, investment etc. (Sicco van Gelder, June, 2008). The author points out the days where the big cities used to compete with one another for placing headquarters of multi-national companies are gone. To a great extent, this paradigm shift can be attributed to technological advances and lowering of regulations across the world. Therefore, cities can now carve their own niche for a separate value proposition they have on offer. At this point, the author points out that the traditional methods of advertising with CNN or pepping up the proposal in terms of commercial, industrial or cultural spaces is no more enough to lure consumers onshore. This is the onset of requirement of a ‘branding strategy for a city. He urges the reader to think about how a value proposition needs to be devised from analyzing which aspect of the city can be used to differentiate itself. He further explains, the three main heads with are required for branding of cities: Leadership Strategy Creativity Leadership The author has identified ‘Leadership as the most crucial component of any city branding exercise and how if leadership is taken into consideration, strategy and creativity can be built around it. The first step to leadership is identifying who are the stakeholders of the city, who would work as partners in the a combined unified goal of re-structuring the city, because unless all the stake holders are on the same page, a restructuring, branding or any such activity can be successfully implemented. In addition to this, it is important to realize that unlike a company, in case of a city all the shareholders are equally responsible for a city branding exercise forming a hybrid type of organization. â€Å"What is required is a partnership where all of the key stakeholders regard each other as equals, regardless of their power or resources, where their individual contributions are valued because, without them, the city will not realize its full potential.† Another important characteristic of leadership is that the leadership should be shared in nature, because a partnership can be created but an effective execution requires the participants to take care of their own agendas along with a collective decision making. â€Å"Shared leadership in a brand partnership requires a far greater degree of common understanding and joint thinking than traditional forms of leadership in the public and private sectors.† All the partners should be keen, eager and willing to work together. A city branding exercise is a collective wisdom which is driven by team work. The author points out that there may be various conflicts of interest, opinions, timing issues, etc. However, the stakeholders need to work together irrespective. At this point the author introduces the concept of a ‘Brand Management Organization, where he illustrates that the role of a Brand Organization is to devise a clear cut branding strategy for the city, i.e. policy changes, re-look at the concerned areas, investment, city attraction strategies, etc. Thus, in the area of brand management as a whole, a city branding provides the following lessons, according to the author: The partnership of the stakeholders is an on-going process. Their work cannot be skewed towards anyone and it doesnt end once a strategy formulation is over. The partnership is not an elitist society; newer members need to be added from time to time. The partnership needs to evolve as time changes. The partnership needs to take timely reviews of the brand strategy and be fluid in making the necessary amendments from time to time. The partnership cannot work in a silo. It needs to motivate the citizens of the city to work together with the brand strategy Strategy There are three forms of strategy which exist: Business Strategy, Brand Strategy and Marketing Strategy (Gelder, The new imperatives for global branding: Strategy, Creativity and Leadership, January, 2005). The author further illustrates that the business strategy is an overall phenomenon, which further dictates the branding strategy. The branding strategy further dictates what differentiates the brand (in this case, a city) from others, what is its unique value proposition, believable, and likeable. Based on these strategies, the promotion design, pricing, delivery, etc. can be decided. To execute the branding strategies, the marketing strategy is devised. The marketing strategy according to the author is translating the brand proposition as value for the stakeholders. As Illustrated earlier all of it revolves around leadership. The author insists that leadership is the key to the three types of strategy, which has direct implications on a successful implementation on the workforce. Creativity Creativity as the name suggests is about ideas (Gelder, The new imperatives for global branding: Strategy, Creativity and Leadership, January, 2005). Creativity according to the author can be of two types: Thinking of existing scenarios in a different manner or coming up with completely new ideas. Creativity forms an inherent component of the entire strategy design. The author explains through the ideas of Jeff Mauzy and Richard A. Harriman, who introduce the concept of systemic creativity, which is further argued by Nicholas Ind and Cameron Watt that creativity is the fluidity within the organization which breaks down barriers. The author illustrates that creativity is not restricted to the mere ideation process, but should be embedded in every aspect of a strategy. â€Å"Creativity is not the same as innovation, which may be termed ‘applied creativity. Creativity is also not the same as improvement, which may be termed ‘routine creativity. However, both innovation and improvement require pure creativity to function† To conclude, the author insists that one without the other is pointless. For a successful execution of a branding process, they all need to work in tandem with one another. WHY BRAND PLACES? Kotler explains how place branding and marketing results in the overall growth of the place and value for the involved stake holders. The equation is quite simple actually, branding a place leads to attraction for the place, which leads to varied benefits as described by the flow chart below: However, it isnt a completely upward graph. In fact, its a growth and decline cycle (Kotler, Place Growth Dynamics, 1999). While the attractiveness of a place brings new industries, job opportunities and betters quality of life, it has its own set of implications. When more and more external industries and people come into a city it leads to increase in usage of a citys resource, which further leads to depletion, increase in costs, etc. which in turn leads to increase in taxes for the community. In addition to this, the author states that there are external damaging effects as well which are defined as ‘process coincidences. Some examples of process coincidences are air pollution, increased crime rate, etc. Therefore, the learning from this is that a city should be branded to gain attractiveness, which is seen directly proportional to a citys prosperity. However, the implications of such a step should be taken into account and contingency plans should be devised by the involved stakeholders and authorities in the citys branding exercise. WHAT IS A BRAND? An Oxford dictionary definition: Brand (noun): a trade mark, goods of a particular make: a mark of identification made with a hot iron, the iron used for this: a piece of burning or charred wood, (verb): to mark with a hot iron, or to label with a trade mark. Varied definitions of brand exist across definitions and disciplines. However, there lies a common line of thought which implies that in its passive form a brand is an object by which an impression is formed, and hence branding is the process of forming this impression (Blackett, April 2004). This book attempts to illustrate how branding has evolved in both active and passive manner. â€Å"The word brand comes from the Old Norse brandr, meaning to burn, and from these origins made its way into Anglo-Saxon.† This process was undertaken to differentiate ones cattle from another. It was also realized that the farmers who took care of their cattle, hence provided much better quality were preferred and came to be identified with the marks on the cattle. The author goes on to explain how brands have come a long way since that era. He provides examples of the Mediterranean age, Ancient Rome, the British Museum, such as: potters marks, roman eagle, flags, to explain the concept further. The true arriving of brands took place during the industrial revolution, when the trading between countries became possible. In fact some of the brands during that time are some of the biggest brands even today: Singer sewing-machines, Coca-Cola soft drinks, Bass beer, American Express, Prudential Insurance, etc. Ever since, the 2nd world war, the world has seen real explosion in the world of brands (Blackett, April 2004). Elements of a Brand Brands are supposed to have some inherent features which are distinctive. Brands are intrinsically striking and that their role is to create an indelible impression (Blackett, April 2004). Intrinsically Striking: According to the author a brand is distinctive through a combination of factors such as, name, letters, numbers, a symbol, a signature, a shape, a slogan, a color, a particular typeface. He also adds that the name is the most important part of a brand, as it provides a universal language interface. However, the name can never be enough; it has to be complemented by other symbols, signs, logo, tagline, etc. which then derive the brands overall philosophy. It is the repetition of these across consumers senses which make a brand what it is. There are obviously exceptions to this rule. However, the exceptions usually only work when a brand enjoys a cult status and has a huge following of loyalists that the changes in the logo, tagline, or even the name do not affect a consumers perceptions about the brand and they continue to relate to it Creating an Indelible Impression: This is the age of high competition and high variety, the author notes. Therefore, the need to differentiate oneself from another becomes of primary importance. Since the consumer is flooded with choice, the brand needs to create an impression which is long lasting and captivating for a consumer to sit up and notice. The brand needs to function in a manner such that it creates a route map in the consumers mind making it an obvious choice amongst the clutter. This loosely translated implies that the consumer neednt be aware about the industry, i.e. the brand just needs to offer a value proposition interesting enough for the consumer to pick it above others. The author also adds that the successful brands are those, which create equity for the consumer, meets the expectations of the consumer and keep the promise they have made (Blackett, April 2004). Brands as Business Assets and Explosion of Branding Blackett further explains that this age expects brands to be assets to a company. Brands, with their ability to secure income, can be classed as productive assets (Blackett, April 2004) in exactly the same way as any other, more traditional assets of a business (plant, equipment, cash, investments and so on). Needless to say that the brands which result in high earnings for the business have direct implications on the overall performance of the business and also results in positive shareholder value for the stakeholders. As the world is moving further, more and more corporations are fighting for the same space. Also, it has moved beyond products. In this age, products are branded, corporations are branded, and literally everything is branded. Guideline for good brand management The author explains that if a brand wants to be truly successful, there are certain guru mantras which need to be incorporated in all brands across categories: Protection of the Brand: This essentially means patenting or trade-marking a brand and its complementing characteristics, such as, logo, name, colors, etc. Honoring the Stakeholders: Each brand should identify who are the stakeholders and work in an efficient manner for all of them, whether its the employees, the consumers, the shareholders or partners. Treating the Brand as an Investment Tool and not Cost: Brand owners need to realize that unless branding is viewed as an investment which brings results, appropriate actions will never be taken and true profitability will never be achieved. Hence, the school of thought which treats branding activities as cost needs to be discarded. Exploiting the Financial Potential of a Brand: Branding these days goes beyond a companys premise. Therefore, it is important for the brand owners to look for and tap opportunities where a brands equity can be maximized. Some examples which the author provides are co-branding, licensing, franchising, training, etc. APPLYING BRAND SCIENCE TO CITIES: BRANDS VS. CONCEPT Brands have sometimes been subjected to a lot of criticism from an array of industries (Gelder, Brand versus Concept in Area Development, July, 2008). Due to association of brands with advertising and marketing phenomenon various industries and professionals find it difficult to accept ‘branding, while are willing to apply ‘concept to their line of thinking. The author attempts to compare and contrast ‘Concept and ‘Brands. According to him, while the two are often used interchangeably, the key difference between the two is the applicability period. He says that while a ‘concept is a unique idea for a specific target group, it usually has an end date. A brand on the other hand, is a promise of value that must be kept for different audiences simultaneously, such as residents, visitors, businesses, investors and institutions. Essentially, brands are not short term; they form the underlying philosophy which is applicable across segments and time periods. Also, while a concepts value proposition decreases with time, in case of a brand, it increases with time. However, he suggests that there is no reason why the two should not complement each other. Particularly, in the area development, place branding process, the two should truly work in tandem with one another. If used in conjunction, the two result in benefits for both. The author further illustrates with an example: A concept such as a designer hotel, a slow food restaurant, an organic market, shared facilities for creative start-ups, an ecological district, a culture institution or a factory outlet centre, etc. can help realize the brand. BRANDING OF CITIES SENSE OR NONSENSE? With Nations, Cities, Places and Areas realizing the perils of branding themselves, branding of places is becoming a popular phenomenon, particularly in European areas. The question is whether the laws and rules of branding can be imitated for places, especially with the restricted flexibility a place offers in comparison to a product or service (Riezebos, 2007). The author attempts to solve this issue by focusing on Brand Architecture, Positioning and Organizational Structure of a City Brand. Place branding as defined by the author is a concept of umbrella branding which a term used for branding different geographical locations. He also distinguishes between city branding and city marketing, the principle difference being that marketing uses the consumer preferences as a guiding principle, while branding defines the vision which the company plans to achieve (Riezebos, 2007). In this journal, the author focuses on the term ‘city branding to disseminate the applicability of the concept as a genuine principle. Using examples of New York, Barcelona and Rotterdam, the author derives Brand Architecture, Positioning and Organization Structure in the following ways (Riezebos, 2007): Brand Architecture: From which level, i.e. country, region, city, borough or area of operations should one communicate from and for which target group? He adds that the first step to create brand architecture is identifying the target group, which in the case of a city is living, working and staying. o People who come under the ‘living category constitute of people who live there currently and people who might live there. o People who come under the ‘working category are not the people who come to a city to work, instead constitute of entrepreneurs who create new employment opportunities. o People, who come under the ‘staying category, are essentially the spin off effect it has for the inhabitants by tourists who visit, when they pay for things for their stay food, accommodation, etc. In terms of relevance for devising a brand plan for a city, the idea is to keep in mind the relevance of the offerings and value proposition for each of the target groups. He also adds that while devising the proposition for each target group, the brand architecture needs to be kept in mind. Failing to do so, will result in each level of the city (neighborhood, borough, etc.) provide their own set of offerings to the target group, which may not be in synch with the citys overall value proposition. As a result, the consumer will be confused and hence, inconsistency will not be able to form a brand for the city. Positioning: How should the brand of a city stand out? o Unlike in the case of products, service, etc. a city usually holds their own set of experiences for the consumer. Therefore, the positioning needs to be in sync with the delivery capabilities of the city, otherwise, the citys value proposition will fall flat. He also adds that positioning need not be of a positive tone, i.e. a negative city cannot present itself as a positive city. However, this does not imply that negative cities cannot brand themselves. A city can use its negative properties to brand itself as well. An example is the way Texas used its mosquitoes plague problem by starting the annual mosquitos festival. The author adds that a city should include the two key aspects in its branding: 1. Distinct positioning and differentiating factors 2. Targeted institution of sales activities such that sales activities are tied to certain activities with the city Organization Structure: What is a good structure for the management of a city? o Since there are a number of parties which influence the management of a city, all the involved parties need to work in the below defined structure: According to this structure, the Chief Marketing Officer (CMO) occupies the most central position (Riezebos, 2007). CMO or the Project Organization takes care of all the marketing, sales and promotional activities of all the target groups. The CMO then reports its activities to the relevant authorities or the City Brand Board (CBB). Usually the CBB consists of researchers, experts on branding and communication, appointed on a revolving term basis. The CBB then reports to the Supervisory Board, which usually includes the Mayor, certain CEOs or heads of companies and institutions. According to the author, this type of an organization structure has the following advantages: 1. Centralization of Brand Related Activities 2. Clear Separation of Execution, Strategy and Top Ranking Ambassadors He insists that these three points should be the guiding principle for drafting a branding plan for any city. COMMUNICATION MODEL FOR CITY BRANDING In a city branding exercise, there are certain types of communications which drive the image of a city (Kavaratizis, 2004). The author implies through this model that the primary target of a city is its inhabitants, and that the beginning and the end point of a city branding is the same, i.e. a citys image. Needless to say that a city always has an image, irrespective of any marketing/branding efforts dedicated to it. He identifies three main methods of communication, in terms of primary, secondary and tertiary: Primary Communication for City Branding: The primary communication revolves around the communicative effects taken by the city, which are defined by 4 types of actions: o Landscape: Essentially the outer appearance of the city, its design, architectural pieces, places of art, etc. o Infrastructure: Essentially the accessibility of the city, i.e. roads, transport facilities, conference halls, etc. o Organization: Essentially the marketing efforts of the citys authorities and how they involve the inhabitants in the decision making process o Behavior: Essentially the services available and provided in the city, events and investment patterns of the city Secondary Communication for City Branding: The secondary communication is the planned and intended communication by the city authorities, in forms of both ATL[1] and BTL[2]. It revolves around what content is being communicated and what is the communication capability of the city authorities Tertiary Communication for City Branding: The tertiary communication is derived from word-of-mouth advertising usually created by media, competing cities, visitors, etc. The author reflects that while the first two forms of communications are largely positive in nature as they are controlled and are of top-down structure. However, it is the third form of communication (Kavaratizis, 2004), which leads to maximum brand salience, making the inhabitants of the city as the chief marketers for the city. LEVELS OF PLACE MARKETING According to Philip Kotler, there are various levels to place marketing, which is a combination of target markets, marketing factors and planning groups. Target markets comprise of the certain chosen segments and the customers to whom the marketing messages are directed at. Marketing factors are essentially the attraction of the place, its infrastructure, the people, its perceived image the quality of life enjoyed by the inhabitants. The planning group is the number of stakeholders who decide and implement the process of place marketing (Kotler, Levels of Place Marketing, 2002). The author further adds that creation of a marketing process creates certain value for the consumer which involves creation of appropriate infrastructure for satisfaction of citizens and visitors, constant need for existing and new attractions which keep businesses and visitors interested, clear communication of its benefits and distinction, generation of support from citizens, government authorities, companies, and institutions. ELEMENTS OF A PLACE MARKETING PROCESS The process of place marketing usually begins with the strategic analysis of a place, which involves its strengths, weakness, opportunities and threats (Ashworth Voogd, 1994). The author points out that in case of place marketing, the elements involved need to be treated differently than marketing of products and services. He explains that each element can be sold separately or as a bundled product in case of place marketing. In addition to this a place is a single entity; however, it can be sold over and over again. The producers of a place product can be many, and the consumers are free to choose the products use for varied purposes. The price of a place product is indirect and non-monetary. The marketing of a place is not restricted to traditional advertising and promotion. A place can improve its liveability, visibility and investibility to market itself (Ashworth Voogd, 1994). There are four main characteristics of a place, which differentiate it from others; place as a character, as a fixed environment, as a service provider and as entertainment and recreation (Rainisto, Success Factors of Place Marketing: A study of place marketing practices in Nor thern Europe and the United States, 2003/2004). It is important to understand that the process of place marketing is a cyclical process, which goes on to infinity (MatloviÄ ovà ¡, 2007) as explained in the model below: According to the author, the process of place marketing begins with acceptance of the marketing concept for the city, which is developed into a vision and a long term plan, at this stage of the process the greatest driving factor is ‘Motivation. â€Å"The initiator must be able to persuade the relevant place opinion leaders about the importance of marketing for the place in question and have them as participants-multiplicators in the suggested process†. The next step is creation of a Marketing information system, where the information available in secondary sources and primary sources is analyzed, which helps develop the profile of the place based on Identity, brand and image of place (MatloviÄ ovà ¡, 2007), as the author explains through the diagram below: The author explains that creation of a place profile is dependent on the semantic differential between the current image and derived image of the city, which can be concluded through a ‘public perceptions survey. Once the profile of a place a created, one needs to conduct a detailed SWOT analysis of the place. The author explains that the SWOT analysis of a place needs to focus on three main areas, which are delimitation of the place, analysis of internal factors of the place (natural environment, demography, economy, infrastructure and business environment) and analysis of external factors (microenvironment and macroenvironment). The combination of a marketing information system, the difference between the current image of the place and the desired image of the place and finally a detailed SWOT analysis helps in formation of a strategy for further marketing of the place. Once, these three steps are covered, a key enabler for further progess is the segmentation of the market, which completes the sub-process called ‘Situation Analysis. At this point, the ‘Goals are decided for the process of place marketing, targeting also takes place at this stage. Based on the goals, a ‘Strategy is Designed, which involves positioning of the city, devising the marketing mix, scheduling inspections, zeroing in on the marketing budget, and inking the overall marketing plan. The author has developed a model for a clear segmentation of a city, as explained below: The author explains through Kotlers suggested methodology for segmentation, and points out that there is not unique way to segment, which becomes even more difficult in the case of a city due to the heterogeneity attached to the single product. He uses the classification of segmentation criterion and applies it to the city: Geographic, Demographics, Psychographics, and Behavioral. â€Å"A successful strategy will result from a detailed and systematic analysis that will respond the two fundamental questions: where is the place situated? and how did it get there? The following comparison of the whole spectrum of data and information will reveal the trends that have to be taken into account in setting the marketing goal. The essence of the conception and strategic stage could be summarized in the two questions: where does the place want to get in future? and how can it be achieved?† (MatloviÄ ovà ¡, 2007) After a clear segmentation, this can be of two types, concentrated and differentiated. The key is that a city needs to decide which of the two segmentation strategies it goes with. In plain terms, this means that if the city chooses a concentrated segmentation strategy, it focuses on a micro segment and devises a value proposition for that segment. However, since a city has the capability to be multi-sold, the city can be marketed to a bunch of segments wi