Country Branding: Some Insights

Over the past 2 decades, countries have been investing heavily in positioning themselves as distinct brands. Effective country branding requires a joint effort by all country constituents – the government, public and private institutions / organizations, people, investors and others. To position a country brand on a global scale, it is essential to align all activities of the parties involved. That inevitably makes country branding very challenging.

The country of origin has a profound impact on consumers’ perception of product / service quality and likability. This so-called country of origin (COO) effect gives credibility, respect and status to products and services. In addition, the positive perception of a country brand makes a country a more attractive destination for tourists, skilled workers and investors. A positive country brand can also help a country better withstand financial crises, sustain higher prices and increase exports.

Country branding is closely connected with the economic situation of a country. Singapore is a case in point: thanks to its investment in country branding, the city-state has progressed rapidly economically. In less than 50 years, it has transitioned from a developing country to a leading global financial hub. Its financial sector accounts for 13.3% of its GDP. Singapore’s case clearly illustrates that country branding should be of strategic importance for any government seeking economic progress.

To build strong national brands, many countries hire communications consultants or public relations (PR) firms and apply brand marketing techniques. With the support of branding specialists, countries launch complex branding campaigns aimed at attracting foreign investment, facilitating trade, improving the competitiveness of the private sector or securing their influence in geopolitics. The choice of corporate branding techniques applied in each case depends on the individual circumstances of each country. 

Country branding has seen the rise of investment branding. To attract foreign investment, countries have focused on promoting their infrastructure, a favourable tax system or other incentives. Some countries promote their financial markets to position themselves as financial hubs.

The ultimate goal of any country branding strategy is to present a country at its best. Paradoxically, to achieve that, you need to know its worst. Furthermore, you need to understand how that country is perceived in its target markets. More specifically, you need to understand what would encourage people to do business there, and what kind of message would resonate there best and why.

Conceptually, country branding is based on soft power, public diplomacy and brand communication. From the perspective of brand communication, the foundation of country branding is storytelling with mass appeal. In practice, that means that countries need to share a compelling and relatable story about themselves. That story needs to have a clear structure and engage the audience’s emotions. 

To better understand the concept of country branding, it is useful to draw an analogy between country brands and business brands. From the perspective of business, a brand is seen as the collection of consumer perceptions about a company and its products / services. Those perceptions might be based on individual feelings or concrete facts, which might affect their accuracy in objective terms. Regardless of that, those perceptions affect prices and sales. Similarly, a country brand is the collection of perceptions about what people should expect if they visit a specific country, buy its products / services or invest there.

Positive perceptions of a country increase national commerce, while negative perceptions might reduce it. Consequently, the impact of country branding on the economy should not be understated. Not only does it affect the tourism industry, but it also has a significant impact on exports and foreign direct investment (FDI), which in turn directly affects GDP.  

References:  Martin Roll, | Lee Hudson Teslik, | Ella Minty, | Jian Wang, | David J Reibstein,