Place branding is a growing discipline, but not everyone in the investment promotion community has adopted it, or understands how to leverage it. There is skepticism about whether a place brand and pithy strapline can really make a difference to investment attraction. The impact is surely marginal in the overall scheme of things, many may argue.
As the founder of eutopia, which develops place brands for cities and regions, perhaps unsurprisingly I do believe place branding can make a real difference.
But, I didn’t always hold that view. Before establishing eutopia, I spent 20 years as a foreign direct investment (FDI) professional in both the public and private sector, during which I considered place branding a ‘nice to have’, not a ‘need to have’.
Investment promotion has changed. There are fewer projects and investment promotion agencies are more dynamic. And we all know the additional challenges to winning projects — protectionism, large subsidy packages like the US Inflation Reduction Act’s tighter regulatory requirements, competition for talent and sustainability.
Now, more than ever, cities and regions must proactively manage their brand and reputation.
Europe’s levelling playing field
While not homogenised, the city or region ‘product’ — or its business-related offering — across many key European investment destinations is becoming more alike and without standout performers. This is due to them having secured high-value projects and enhanced their cities and regions more broadly over the past few decades.
It means softer factors are increasingly important. It’s not all about economic drivers like costs and skills, but also excellent quality of life. That means housing options, green space, culture, smart mobility, excellent education facilities, flexible commercial premises and other leisure amenities. From the economic side, there is more interest in the indigenous base to support sustainable supply chains and opportunity to acquire intellectual property from innovative small and medium-sized enterprises.
FDI professionals must be more familiar than ever with capital investments expanding local infrastructure, and city regeneration and transformation. Serious companies are not selecting locations unless they are serious about sustainability. This wider ‘place’ proposition is now central to investment promotion, rather than an appendage to it.
Pitching a location to an investor, however, is more cohesive when underpinned by an effective brand strategy. Branding influences how we make choices as consumers, but also as businesses. We buy into a brand and are often completely loyal to it believing the brand promise and the benefits that it can bestow.
Place brands work not just for investment promotion, but also for tourism and the attraction of tertiary-level students, who are critical to the talent pipeline for investment promotion.
More than marketing
Global leaders in place branding include Stockholm, Helsinki, Columbus (Ohio), Denver (Colorado), Lyon and Dublin. It’s no coincidence that these cities are also very competitive in investment attraction.
A good place brand will also help shift perceptions, as evidenced by Limerick, Ireland. The city has undergone a transformation over the past two decades, shifting its image away from safety and social issues to become one of the country’s most attractive cities and among the country’s biggest recipients of announced greenfield FDI, according to fDi Markets. Place branding has been a critical part of the toolkit in that transformation.
A cohesive brand strategy allowed the city to “elevate” its profile, and “attract meaningful investment”, in the words of Donn O’Sullivan, head of marketing and communications at Limerick City and County Council.
A brand must be authentic and backed up by evidence, of course. Foreign investment is evidence, and part of what makes a great location. But investors need confidence in the wider proposition which will be more credible if underpinned by data, benchmarks and a tailored brand narrative for the location. In a more competitive market, an effective place brand strategy is a key to helping build and convert the investment pipeline, and encouraging existing investors to expand and become a bigger part of the city or region’s image.
fDi
