By Erik van ‘t Klooster for Placebrandz.com

Many places focus their place branding initiatives on tourism, which is often referred to as ‘destination branding’. In fact, in the academic discipline of tourism studies there is a whole stream of publications focusing on this aspect of place branding. A myopic focus on tourism is not a wise idea though and the expression ‘destination branding’ is in fact an anomaly. Why? A key objective of place branding is image or reputation management. As we have explained in earlier blog posts, image is an undividable network of association in the minds of consumers that incorporates all kinds of associations, be they relevant to tourism, or not. Also, a consumer can be a tourist today, a potential investor tomorrow and a new resident the day after. As we’ve indicated before, it is therefore not a good idea to take a demand-side approach to branding; confusing branding with marketing, but one should initiate branding from a supply side perspective; i.e. who are we and how do we want the world to see us? Destination branding is therefore a misleading concept, because ‘destinations’ only exist in the minds of tourists, so the concept, therefore, by definition, is demand driven. This is wrong, also because it won’t facilitate internal branding, because for residents it is not very attractive to reduce their home, their community, their ‘being’ or identity, to a ‘tourist destination’.

So, place branding is about place making and linking image with identity. It is not (just) about tourism promotion but facilitates many other things, such as exports, attracting investments, talent and retaining existing residents. Hence, this blogpost explains some of the ideas we support when it comes to developing the business sector, besides tourism. We are in particular inspired by Ed Burghard’s recent blogpost on his website www.strengtheningbrandamerica.com. He puts forward two frameworks which we think are useful for place brand strategies geared towards businesses development.

Ed starts with discussing the cluster analysis framework by Michael Porter. Porter argues that places should invest in sectors that are unique, difficult to duplicate and supported by upstream and downstream activities (e.g. downstream: value added services and market access; upstream: education and other production factor inputs).

Next, in order to identify a stable and prosperous set of clusters, Ed advocates the use of the Pareto’ principle to make a list of industries which drive the local economy. The idea is to work towards a situation where 20% of all industries generates approximately 80% of economic growth. Finally, Ed remarks that focusing on current clusters is not enough. Cities and regions should also try to innovate in a more radical way by supporting one or two new, promising industries that can, at the same time, strengthen the brand positioning.

When the previous supply side driven strategic decisions have been made, the next step consists of promoting and facilitating smooth collaboration among local and potential business partners. Two instruments can help in this respect. First, policies and regulations need to be put in place related to taxes, incentives and administrative procedures in order to optimize the ease of doing business in a city / region or nation.

The second instrument is a website which is used for both (a) internal marketing among local businesses, and (b) external marketing towards potential business partners. A good example of such an effort is http://www.ohiomeansbusiness.com/ (developed with the help of strengtheningbrandamerica.com).

As you may notice, during the course of this blog we have moved from a branding to a marketing perspective and it is essential to link the two, facilitating one brand for multiple target markets; that is the challenge.

We are curious to know your opinion about the approach set out above. Is it in line with your experience in place branding for business? Or do you find other tools more effective and efficient?

By the way, Placebrandz.com can now also be found on facebook.