National Brand Identity & Its Effect On Corporate Brands: The Nation Brand Effect (NBE)

Multinational Business Review, Fall 2003 by Jaworski, Stefan Paul, Fosher, Don

INTRODUCTION

"Govern a family as you would cook a small fish: very carefully"

-Chinese Proverb

The power of culture, ethos, and just "being" within the living Brand of a nation is something each citizen on earth experiences every day. Yet, few stop to consider that, since the dawn of time, human beings have been radically affected by the Brands they live within-and vice versa. From the hunter-gatherer group on the Serengeti, the ancient Egyptian nation built on the Nile, France Under Napoleon, newly emerging opensociety China, to today's United States of America, human beings live within Brands and Branded systems that shape the way they act, think, and are perceived. In other words, the Core Values and essence (the Brand identities) of nations big and small diffuse throughout the native populations that live, reinforce, and spread them-a gigantic, churning circle of Brand building.

Like any Brand, nations have individual DNA or fingerprints that are unique unto themselves-no two nations are alike. From language and skin color, to music and art style, to customs and religion, no two nations on earth are exactly the same. Unlike company Brands where imitation/ copying is too often a norm, Nation Brands are often free from this because of their diversity of thought, effect of differing opinion, geographic separation and language, unique histories and experiences, genetics, unlimited product lifecycle, and the desire of societies to be special and original. Human populations like to be strongly differentiated Brands-and this desire has great effect on Nation Brand identity.

But, how about the Company Brands inside the nations? How are they affected by the Nation Brands they live within?

Say the word "Italian" in conjunction with clothes, sports cars, food, perfume, art, and craftsmanship and suddenly the item gets a very desired position-premium, better tasting, high quality and price point, and stylish. I have seen many examples whereby a restaurant sets up in a space haunted by previous bankruptcy and failure only to thrive and attract competitors. The reason for success-it was an authentic, old family Italian "ristorante" (probably run by non-Italians). The patrons are young, trendy, upper income, and stylish; the eatery is perceived, because of its Italian connection, as automatically the place to enjoy "Ia dolce vita" ("the good life").

Perception is reality. The same with consumer goods such as suitsa Chinese mass garment maker putting a generic "Italian" designer name on its goods instantly increases their price point, perceived stylishness, and sell-ability. Franco Tassi is an excellent example. The garment sells for more than its like China made competitors (which usually become store house Brand products) and is perceived as a stylish, higher quality garment because "it's Italian." Take a look inside the inner vest pocket and you can see the look change on consumer's faces: "Made in China." Better yet is the change in their perception of the garment's quality and stylishness with the new information-it goes down.

Swiss watches are a good example of Nation Brand power-anything with the "Swiss Made" moniker on it watch-wise receives tremendous punch. Of course, Swiss watch standards like Breitling, Piaget, and Rolex receive tremendous amounts (if not most) of their Brand equity from being Swiss made. But, recently, more moderate price point Brands such as Swatch, Guess, Anne Klein and even "no name," ultra lowprice Chinese copies benefit from the words "Swiss Made" stamped on them. In fact, the first three Brands depend heavily on the Swiss connection to reinforce or even elevate their position as high quality, precise, and serious "time pieces." Even third world counterfeit watch Brands make sure that the Swiss connection is evident on their offerings.

What we see here is simply the power of National Branding-the essence and Core Values (Brand identity) of the country of origin coming through, affecting everything from positioning, differentiation, and Brand identity to purchase decision. As Brand Strategist Mike Moser tells us, "Do any of your company's Core Values mirror the Core Values of your culture (nation)? If they do, then leverage this advantage and you'll find that your Brand resonates much deeper in people's hearts and minds." (Moser Mike. United We Brand. Harvard University Press. 2003. Pg. 23)

Apple Computers is an excellent example of a Brand that is benefiting by tapping into the Nation Brand effect of the USA with its "Think Different" campaign which attaches to the U.S. Core Values of independence, self expression, freedom, creativity, etc. Quite literally, when we purchase an Apple, we are really buying the Core Values of America (Nation Brand) and Apple (Corporate Brand). (Moser Mike. United We Brand. Harvard University Press. 2003. Pg. 23)

Of course, the opposite effect is true, too. A Nation's Brand identity can transfer negativity to a company Brand. For instance, Yugo cars were an abysmal failure in North America, pulling out quickly simply because of their perceived "backward," low-quality origin (coming from the Soviet East Block). Datsun suffered the same problem: negativity transference of the poor quality Japanese Nation Brand to its early carmakers. Remember, the Japan Nation Brand in the 1950's and 1960's was quite correctly perceived by the world as a low quality producer (especially of toys) before the Edward Demmings' 14 points influence came to fruition. Hence, Datsun became Nissan and the other automakers spent decades on a total quality bent reinforced by focusing on this one issue.