Wednesday, 15 August 2012

The Comparative Place Branding Advantage Theory for Nation Branding

I was advised by Professor Jasmine Simi A.H my Brand Management professor at Christ University to look into a very heated topic of Place Branding. As I did look into the topic and read about it I got an idea.

I related the Branding segment of studies to that of economics and tried to understand that can the theory of Comparative cost Advantage be used in Branding.

In economics, the law ofcomparative advantagerefers to the ability of a person or a country to produce a particular good or service at a lower marginal and opportunity cost over another. Even if one country is more efficient in the production of all goods (absolute advantage in all goods) than the other, both countries will still gain by trading with each other, as long as they have different relative efficiencies.

Source: Wikipedia (Sure many have disputes with the information being not accurate on wiki. However I am pretty sure this one is correct !)

The theory really says that if a country A has comparative cost advantage over country B for making a particular commodity say X and country B has the same over country A with product Y, then country A should produce only commodity X and country B produce only commodity Y. Then these two countries should trade. Now this is really amazing sounding in theory. However with the insecurity of countries having over their security I guess politicians will not like to be dependent of factors that determine their economic power. For example if commodity X is weapons and commodity Y is an agricultural product then I guess that country B will not just make agricultural products and be dependent on its defense from country A.

However I feel this theory can be applied in Branding. Lets take the same example of country A and country B. Now country A and country B have similar tourist spots. Applying the theory above there will be one attraction which is more fitting for one country. Country A can specialize in one type of attraction and country B can specialize in another. It is somewhat like saying that one restaurant specializes in pizz and the other restaurant specializes in burgers. Even though both serve pizza and burgers.

For a country to decide which is that attraction that best fits them , the country should study the attraction in comparison with their culture , nature , technology and their geographic location.
  1. Culture: Does the attraction reflect the culture ? 
  2. Nature: Is it in the dominating natural environment of the region ? or Is the natural environment unique to the country ? 
  3. Technology: Does the country have the technology to deliver ? 
  4. Geographic location of country: Is the location in sync with the attraction ? 
  5. Cost: Is it economically effective and most importantly efficient ?
Different tourist spots in a country can be related to the above factors and weighed to see if the attraction best describes the true meaning of the country. Then the countries should sit on negotiation tables and decide brand identity the countries tourist industry must hold.

They can determine their Brand Mantra and Brand Image based on that attraction.

Do leave comments below. Just click on comments. Then add comments.

Cheers ,
Until next blog post

- Anant Agnihotri


  1. What a great post! I am doing research for my marketing class. I had no idea that there even were brand management companies. I think I may have to do more research to find out more on these companies. They sound interesting to maybe work for. Thanks for your post!

  2. Hey Briellen Fraklin ,

    If I may ask what are you doing a research on ?

  3. Hey Anant!
    The assignment was to come up with different companies one can hire to assist with their own company. It has been a little confusing, but your post helped with coming up with new ideas. Thankfully it's not due till the end of the semester. I can let you know what I come up with when it's finished :)

  4. You have a very interesting topic there. You might want to check out this Company known as 'Interbrand'. It provides vast amount of services including brand strategy, brand analytics, brand valuation, corporate design, digital brand management, packaging design and naming.

    Also if you liked this post you could read the ones I wrote before this one. However, it is all about branding.

    It would be wonderful if you do let me know what you come up with regarding the assignment :)