The Questionable Notion of the National Brand

I have to admit: I have never been a big fan of the notion of "national brands”. The reasons are both analytical and political. Even the most socially and culturally homogeneous countries are composed of many “moving parts”. As such, any attempt to encapsulate the national ethos in a few chosen descriptive words, much less to rank nations on the basis of their “brand” strength, seems to me an analytically futile task. At the political level, my concern is darker. National branding too easily slides in national stereotypes, which itself can slide in national demonization, if not worse. The last century has shown us the tragic consequences of this process, if left unchecked.

That said, in recent times we have seen increasing efforts to turn national branding into a respectable activity. One interesting effort is that of a consultancy called Future Brand, which has for several years produced a report which they call the “Country Brand Index” here. Based on interviews with 2700 travelers, supplemented by expert opinions and some statistical analysis, the most recent report for 2008 found the 10 leading national brands to be, in order--Australia, Canada, America, Italy, Switzerland, France, New Zealand, Britain, Japan and Sweden.

One might be tempted to treat these findings in a rather cavalier manner (despite the 64 power point slides in the 2008 report), especially since the focus of the rankings is the perception of tourists. But there may be a more serious aspect to the exercise. In commenting on these rankings, a blog posted under the auspices of Economist.com (called Gulliver, I believe) noted in a posting on November 10, 2008, as follows:

“… [T[he brand experts are very definite that theirs is a science that countries need to take seriously:

“ "Countries are becoming more aware of the importance of defining how they want to be perceived and the need to improve and leverage their assets. While tourism is often the most visible manifestation of a country brand, it is clear that the image, reputation and brand values of a country impact its products, population, investment opportunities and even its foreign aid and funding."”

Is that true? Are investors and funders really swayed by national branding? Surely their decisions are too rigorous to be swayed by marketing campaigns? Gulliver awaits conversion.”

Gulliver From Another Time

I thought about Gulliver’s comments as I was recently reading a piece in the July 4, 2009 issue of The Economist entitled “Courting Disaster: Russia’s Dismal Investment Climate.” The piece recounts several examples of the unfavorable business climate for foreign investors and the like in Russia. One paragraph particularly grabbed my attention:

“The clearest indictment of Russia’s investment climate came a few days ago from IKEA, a Swedish retail chain, whose local operation has grown quickly since it opened it first store near Moscow in 2000. On June 23 IKEA said it was suspending its investment in Russia because of the “unpredictable character of administrative procedures”, a euphemism for graft. A symbol of Russia’s economic rebound from the 1998 financial crisis has become an emblem of its dire investment climate.”

My point here is not to enter into the debate about whether or not Russia’s investment climate has deteriorated. Rather, it is consider briefly the notion of the “national brand” issue when juxtaposed against the power international private brand of IKEA. Maybe the reported action by IKEA (I am not certain what the article means by “suspending its investment’) is a straight-forward business decision to scale-back its activities in Russia; maybe it is a tactical ploy to pressure the Russian authorities in order to obtain more favorable conditions for the retailer.

Either way, there is a Manichean tone to The Economist’s description of the situation. IKEA is the retail white knight, whose very presence in Russia once served to validate a positive image of Russia, but whose white-knight image is now threatened by the gathering storm clouds of public perception about the nature of Russian administrative and commercial practice. The constant here is the IKEA brand, the variable is the national Russian brand. Seen in this way, the call by Gulliver for taking the notion of the national brand more seriously seems to be more siren than prescription. The notion of the national brand still has a long way to go.

IKEA--Ever the White Knight