Cities Are the Next Growth Brands

A new study released by PricewaterhouseCoopers (PwC) and WPP’s BAV Consulting suggests that perceptions of a city can greatly impact its success, prosperity and livability. In other words, brand image matters—even for municipalities.

“Just as companies compete for customers’ dollars, countries and cities are competing for investment, tourists, political and economic influence more than ever,” says Deborah Bothun, PwC’s Global Leader for Entertainment & Media.

The study surveyed more than 5,000 people across 16 countries about their perceptions of cities and revealed key drivers behind powerful city brands.

“Nations have leadership and policy issues that can make their images polarizing or unpopular, yet cities don’t suffer the same fate. They are less political, more vibrant and in many instances, more popular than the country they’re in," says John Gerzema, CEO of WPP Group’s BAV Consulting, the firm who conducted the study with PwC. From Stockholm to Kuala Lampur, the study found strong ‘brand equity’ in cities and in many instances high correlations with the nation’s overall image.

The study also found that a strong ‘quality of life’ is critical to positive perceptions of a city, including measures such as income equality, job market strength and economic stability, as well as global citizenship, which include records on human rights and religious freedom. Likewise, being perceived as modern and inclusive is paramount to a city’s prosperity. Respondents touted innovation and entrepreneurship, skilled labor and education, and transparent business practices and infrastructure development as key to attracting both talent and investment. “These traits we studied can create greater engagement in the form of visiting, living in and studying in a city,” Bothun says.

And while positive perceptions of a city are linked tightly to its prosperity, negative perceptions can also point to economic declines, impacting the city’s attractiveness to prospective residents, businesses and tourists.

So what can cities do to move the needle?

Invest in infrastructure.

It’s about more than just roads. Reputable, well-developed infrastructure contributes to modernity, which is a top driver of visiting, living in, doing business with and going to school in a particular city. “Investing in roads, bridges, public transportation and a myriad of other things that define infrastructure is money well spent, because it attracts investment and an influx of people in the short and long term,” Gerzema says.

Educate people about the positives.

Some cities have material problems such as poverty, unemployment and safety issues to overcome. Climbing those hard hurdles requires major commitments by state and local governments. But there are things those cities can do in the meantime to increase their visibility and draw in visitors. The city in question needs to have a strong empirical understanding of what its perception problem is.

Understanding and closing the gaps may not be enough to turn around a negative perception, Bothun explains.

Align with corporate brands.

“By tapping into BAV’s renowned study of corporate brands, we found that there are strong correlations between some major global city brands and some major corporate brands,” Bothun says. “Cities can look to these ‘corporate twin’ brands for strategic inspiration both in how to brand, market and communicate but also in how to run a business with an eye towards greater ROI.”

Gerzema points to BAV’s Brand Asset Valulator for examples. “We know from our BAV database that Paris is correlated with Chanel, Moet & Chandon and Vogue, while Amsterdam is correlated with Lego, Apple and Starbucks,” he says.

Corporate partnerships can be an important part of a city’s strategy. Working with a corporate twin allows the city to borrow positive characteristics.

There are many examples of aligning with corporate brands. A city can partner with a corporate brand to take on an issue like homelessness. Or cities can partner with technology brands to create city-wide Wi-Fi. Bike sharing systems like New York’s Citi Bike program are also seeing brands and cities joining forces for both social good and mutual brand benefit.

Understanding corporate branding has other benefits: A corporate brand may have traits a city hopes to emulate or develop, but doesn’t currently have. In other words, dress for the job you want, not the job you have.

Leverage the relationship between city and country brands.

For example, images of New York City and the United States are highly correlated. But San Francisco’s image is more scenic, fun and happier than that of the U.S. as a whole. Similarly, Los Angeles is more innovative and trendy than the U.S., and Chicago is seen as more trustworthy.

“These secondary cities can be used as tools to help evolve the image of a country as needed and can help fill in necessary gaps,” Bothun says. For instance, Brand USA can lean on San Francisco to grow tourism. “For global, multinational corporations, it can also help business leaders understand cultural nuances of entering, operating in and attracting talent in disparate cities and countries.”

Here's a closer look at two of the cities in the study stacked up on the perceptual scale – and what they can do to make the most of it.

Sao Paulo: Big Business, but Bureaucratic?

Sao Paolo has a burgeoning reputation for business, thanks in part to the International Business School, which develops business leaders who can then proactively shape the Brazilian economy.

Yet while Sao Paulo is seen as an economic powerhouse within Brazil, it also suffers from negative perceptions, such as being seen as corrupt and unsafe. Case in point: While Sao Paulo’s brand is tightly linked to Brazil’s brand – the study found a 70 percent correlation between the two – the city is seen as more corrupt and bureaucratic than its home country

One solution for San Paulo would be to drive partnerships with companies that are known for being trustworthy, reliable and caring, says Bothun. Establishing such relationships could promote a more positive view of the city.

“In Sao Paulo, the business community needs to raise awareness of its business climate,” Bothun says. “Aligning with brands that evoke perceptions of safety, economic viability and trustworthiness would be a good place to start.”

Stockholm: Families, Facilities and Forward-Thinking

Survey respondents consider Stockholm to be modern, eco-friendly, well-developed, safe and family friendly. Both men and women enjoy perks like 480 days of paid parental leave, a government issued “child allowance” of roughly $122 USD per month, and free education from preschool through college. Likewise, health care is nearly free.

Yet there is room for improvement. The study shows that Stockholm isn’t strongly associated with culture or seen as politically influential.

“The city is falling behind on five out of six drivers of ‘intent to do business,’” Bothun says, “including being connected to the rest of the world, providing easy access to capital and being perceived as a leader.”

By identifying these vulnerabilities in Stockholm’s international image, city officials and strategists can develop a plan to raise the city’s profile as a global hub for business.

This might require real infrastructure investment and changes in economic policy.

Perceptions of a well-developed infrastructure – that is, making investments in both transportation infrastructure and human capital – can inspire tourists, potential residents and business partners.

Breaking out of a negative stereotype can be difficult. “Crafting an image is much more than marketing and communication,” Bothun says. “It requires real change and accountability to create sustained brand equity.”

Source:/usnews.com/