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Nation
Branding and Place Marketing - The Place |
by:
Sam
Vaknin |
IV.
The Place
Some countries are geographically disadvantaged.
Recent studies have demonstrated how being
landlocked or having a tropical climate
carry a hefty price tag in terms of reduced
economic growth. These unfavorable circumstances
can be described as "natural discounts"
to a country's price.
What can be done to overcome such negative
factor endowments?
In classical microeconomics, the element
of "place" in the marketing plan used to
refer to the locus of delivery of the product
or service. Well into the 19th century,
the "place" was identical to the region
where the product was manufactured or the
service rendered. In other words, textiles
weaved in India were rarely sold in Britain.
American accountants were unlikely to practice
in Russia. Distribution was a local affair
and networks of dissemination and marketing
were geographically confined.
A host of historical and technological developments
drastically altered the scene and frayed
the straitjacket of geography.
The violent disintegration of the old system
of geopolitical alliances led to the formation
of massive, multiplayer trading blocs within
which and among which the movement of goods
and, increasingly, services is friction-free.
The vast increase in the world's population
- matched by the exponential rise in purchasing
power - created a global marketplace of
unprecedented wealth and a corresponding
hunger for goods and services. The triumph
of liberal capitalism compounded this beneficial
effect.
The advent of mass media, mass transport,
and mass communications reduced transaction
costs and barriers to entry. The world shrank
to become a veritable "global village".
The value of knowledge (processed information)
has fast risen to surpass that of classical
(physical) goods and services. Information
has some of the properties of a public good
(for instance, nonrivalry) - coupled with
all the incentives of a private good (e.g.,
profit-making).
Thus, the very nature of distribution had
been irrevocably changed. The distribution
channel, the path from producer to consumer
(in our case, from country to foreign investor
or tourist, for example) is less encumbered
by topography than it used to be.
Even the poorest, most remote, landlocked,
arid, and disadvantaged country can nowadays
leverage air flight, the Internet, television,
cell phones, and other miracles of technology
to promote itself and its unique offerings
(knowledge, plant and animal species, scenery,
history, minerals, cheap and educated manpower,
cuisine, textiles, software, and so on).
The key to success is in a mix of both direct
and indirect marketing. Nowadays, countries
can (and do) appeal directly to consumers
(ads targeted at tourists or road shows
aimed at investors). They present themselves
and what they have to offer, circumventing
brokers and agents of all kinds (disintermediation).
Still, they should not fail to cultivate
more traditional marketing channels such
as investment banks, travel agents, multilateral
organizations, or trade associations.
With many of the physical obstacles to marketing
removed in the last few decades, with the
very concept of "place" rendered obsolete,
promotion emerged as the most critical facet
of nation branding and place marketing.
About the Author
Sam Vaknin ( http://samvak.tripod.com
) is the author of Malignant Self Love
- Narcissism Revisited and After the Rain
- How the West Lost the East. He served
as a columnist for Central Europe Review,
PopMatters, and eBookWeb , and Bellaonline,
and as a United Press International (UPI)
Senior Business Correspondent. He is the
the editor of mental health and Central
East Europe categories in The Open Directory
and Suite101.
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