Place Marketers Take Note: Lessons from Recent Community Crises

At the IEDC Annual Conference today, someone asked a site selection consultant panel whether the acts of violence occurring in cities in response to police shootings would have an impact on companies considering expansion or relocation. The consensus was that because they tend to have short term impacts, the effects would be largely minimal. 

Still, a community crisis certainly has the potential to damage the place brand and identity if not handled correctly.  As recent events in El Cajon, Tulsa and Charlotte have shown, the media attention given to a community can go national and international in its scope of coverage. Place marketers must understand that when a crisis arrives, having a strategy in place is essential in limiting damage to the place reputation.

Here are three steps for addressing a crisis situation in a community that can help create positive PR and content after a negative situation has gained momentum:

1.     Be honest and authentic. It is critical that the community be honest and upfront about the issue at hand and to release as much information as possible.  Tulsa avoided civic disturbance by issuing a video of the sequence of events surrounding a recent shooting in their community and charged the officer in question promptly.  Charlotte, on the other hand, delayed such actions, allowing civic disturbances to germinate and grow in intensity.

2.     Address the issue thoughtfully. - If mistakes were made, admit it, apologize and do everything possible to correct it.  Develop a dialogue with the offended parties and invite their collaboration in establishing new protocols or programs to ensure the issue never happens again. Communication is key to managing the crisis and producing positive results through improved practices and community involvement.   

3.     Communicate with key audiences. As one site selector on the panel responded, “make it personal”.  You need to tell people what is going on, how you are responding and how your community plans to mitigate the problem. You need to assure companies or consultants that you may be working with that the instance is isolated and your community has a plan to prevent it from happening again in the future.

Most people will understand that incidents of this type are mostly outside of the control of your community.  Getting out in front of the issue and demonstrating openness and concern for the interest of your existing and potential businesses will help to establish trust and repair any potential damage before it has time to impact their decision making process.

Warren Buffet once said: “It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you’ll do things differently. Likewise, years of success and building a brand identity for your community can be severely damaged by a community crisis.  EDOs would be wise to prepare in the calm before the storm to ensure they are not caught off guard should such an incident occur in their community.

Challenges of City Branding

Challenges of City Branding

 

We recently came across an excellent article Teemu Moilanen (2015) entitled the “Challenges of city branding: A comparative study of 10 European cities”. It is written from the viewpoint of the public sector economic development organization, but certainly his research is applicable in the US and for private secotr organizations as well.  We’ve summarized his findings below and you can find the full article here.

1. Large number of stakeholders - The process of place branding requires participation of large number of stakeholders ranging from public sector organizations to firms and non-profit organizations, who have different objectives. A significant proportion of the stakeholders have conflicting and parallel activities. The sheer number of stakeholders makes it difficult to include all relevant parties in city brand planning process.

2. Limited understanding of branding within the network of stakeholders. Marketing in general, and branding in particular, is foreign to many public sector stakeholder organizations and individuals, who occasionally reject it as too commercial. Similarly, public sector representatives have a narrow view of branding (perceived as logo planning) or do not understand the purpose and process of branding at all, and accordingly it is difficult to make all relevant stakeholders understand that they do have a role in the development of city brand.

3. Limited internal buy in the challenge of securing sufficient political support from the public sector and city hall. The private sector is more familiar with branding as a concept. However, it is challenging to mobilize private sector organizations to participate in the city branding process, and to find ways to make the organization in charge of city branding relevant for private sector actors.

4. Securing sufficient funding - A major element of this challenge is the need to convince public sector decision makers that branding is an investment with positive return on investment. Limited funding leads to other difficulties, including the need to make compromises, eliminate necessary activities, and limited or non-existent market research. To a lesser extent, attracting funding from private sector stakeholders also is problematic.

5. Slowness and time-related issues - Large numbers of stakeholders increase the time needed for internal communication and decision-making, and generally slow down several phases of the brand management process. Funding-related decisions made in the public sector are often delayed. Private sector actors are generally faster than public sector stakeholders, leading to frustration at one end and feelings of haste at the other end.

6. Organizational issues and lack of authority to lead - This challenge appears to be a composite of two major features: conflicting opinions of key stakeholders, combined with lack of clear leadership. These are exacerbated by an unclear decision-making structure, limited coordination between stakeholders, stakeholder’s fear of losing power when engaging in a cooperative branding process and the challenge of building an effective system for internal communication within a loosely structured network organization. The lack of a linkage appears to be the main difficulty in finding individuals or organizations to be in charge of the process.

7. Operational brand management - This challenge appears to have two major components. The first one is a set of issues related to the difficulties caused by day-to-day management of the external marketing communication campaign. These include difficulties in combining city branding activities with the activities of a single stakeholder, difficulties in finding ways to help stakeholders to use the brand, lack of marketing skills, parallel activities and inconsistent messages. The second component is the difficulty in transferring the brand identity to product experience. In other words, how to move from words to action, to diminish the gap between marketing and the reality experienced by visitors.

8. City brand strategy formulation - It is a composite of several smaller interlinked issues, that is, the difficulty in identifying target groups, defining brand identity, differentiating from competitors, focusing on the wrong competitors, difficulties in tailoring the marketing message to different markets and customer segments, difficulty in defining the relationship between the city brand and the regional/national brand, and general lack of strategic thinking and dialog. Challenges related to brand identity definition appear to be closely linked to the first two challenges discussed in the literature review; determining if there is a common and collective character in this complex entity of products/services that could be captured by a single brand and simply reaching a common agreement as to what is being marketed/branded. Several interviewees also emphasized that a city is a highly complex product, but in many ways similar to other cities.

9. Monitoring and poor situational awareness- Interlinked features of this challenge are the lack of good measures for brand success, utilization of wrong measures and use of unsophisticated monitoring tools. Combined, these features lead to poor situational awareness and market understanding, inefficient use of resources and failure to justify actions and budget requirements to decision makers.

Moilanen, Teemu. (2015) Challenges of city branding: A comparative study of 10 European cities. Place Branding and Public Diplomacy 11 (3): 216–225. Article

North Carolina Latest to Demonstrate Why Public Policy Matters in Place Branding

Last week, PayPal announced they were cancelling plans for a new 400 employee operations center in North Carolina due to the passage of an anti-LGBT law. The law has brought rebukes from rights groups, business leaders, artists and entertainers, and led to more than a dozen canceled conventions. Meanwhile CNN reported that Mississippi’s tourism industry is facing a backlash in response to passage of a similar law. 

This public outcry should not be surprising to legislators in those states since loud objections and threats of economic boycotts were voiced when similar laws were proposed in Indiana and Arkansas last year.

The negative impact of these legislative efforts demonstrate why you cannot separate place branding from public policy. Legislation and rules, whether considered pro-business or anti-LGBT, impact how people view a place and their desire to interact with it.  Indeed some, like Simon Anholt of the Good Country, argue that place branding is only accomplished by policies and public diplomacy, not by marketing or communications.

Some public officials understand this. North Carolina's Attorney General Roy Cooper said he would refuse to defend the law in court. "We're talking about discrimination here," Cooper said at a press conference, according to CNN. "Not only is this new law a national embarrassment, it will set North Carolina's economy back." Governors in Ohio and South Carolina have denounced anti-LGBT laws, without a corresponding backlash.

Surprisingly, though, North Carolina’s top economic development official has chosen to stay mum on the topic even as companies threaten to leave. Chris Chung, chief executive of the Economic Development Partnership of North Carolina, was quoted by the Charlotte Observer as saying his organization recognizes “the wide range of opinions on the new legislation, but as an organization that performs under contract with the state government, the EDPNC does not take positions on matters of public policy.”

What?  Groups like the EDPNC spend millions of dollars annually to promote their place as a desirable location for business investment, travel and residents.  Many public officials claim that “economic development” and “job creation” are their number one priority.  When their actions threaten to destroy those efforts, someone needs to speak up and point out the inseparable connection between the two.

Places have images just as products and corporations do. Consumer acceptance of the product or place is dependent on creating a positive image. Those images must be built from within and based on something authentic, not constructed by a marketing or PR campaign.

In other words, actions speak louder than words.  If a product benefits from a great marketing campaign but it does not satisfy its user, then the product is a failure.  Likewise, in place branding, a state like Michigan, for instance, can have the best television ads in the world to support their “Pure Michigan” brand, but a failure of public policy around providing clean water to its residents in Flint can undermine the whole effort both past and future. 

Public policy and place branding must work in harmony with each other.  By passing legislation that is objectionable to some of the same audiences that economic development agencies are trying to reach, the policy makers in these states undermine their economic development efforts.  It will take many months – or even years – to overcome the damage caused to the brands of these states by their legislators.  If they are truly interested in "economic development", they must learn to focus on substantive measures that improve the competitiveness and image of their location, not symbolic actions that are intended to curry favor with a particular political constituency.

Where Regional Branding Goes Wrong

Where Regional Branding Goes Wrong

Where do regions go wrong when marketing their brand?  By focusing on a generic, one-size fits all brand rather than viewing their region as a portfolio of individual ones.   

Most regions look to create an umbrella brand, but this lends itself to dilution of the region’s unique characteristics.  By putting all of the region’s assets together under one brand, regions promote sameness rather than diversity.  For instance the “Detroit Region” may invoke negative images while ignoring the R&D strength of Ann Arbor, the hip sophistication of Royal Oak or the water recreation mecca of Mount Clemens. 

Imagine Crest toothpaste, Dawn dish soap or Charmin bath tissue all being sold under the generic Procter and Gamble (P&G) label.  Each of P&G’s brands serve customers in different ways—but all with a focus on making peoples’ lives a little easier. So should regions focus on positioning their individual places with specific markets or industries in a way that suits their target’s business goals.

Like these consumer brands, places have unique characteristics and attributes that deserve to be highlighted because of the varying needs and interests of their target audiences.  Regions are not homogenous and should not be pasteurized through bland, generic branding. 

Certainly, there is a need for an overarching brand identity within regions.  But, investment promotion agencies need to focus more sharply on the attributes of their individual communities. General Motors is comprised of several divisions (Buick, Cadillac and Chevy), GMC) that each have individual models (Malibu, Cruze or Volt).  Each model has its own brand as does each division and combined, they make up the entity known as GM. 

Likewise, regional economies are nothing more than the sum of their local ones.  The communities contained within a region represent a series of products that form the regional product line.   Each deserves its own marketing strategy. 

Regional groups can strengthen their area and generate more investment opportunities by building a branding campaign that views each community as an individual brand and has a strategy for each.

A Trend for 2016

Our response to Janet Ady's article on complexity being at the forefront of economic development trends in 2016....

There is no doubt that economic development is becoming more complex due to the factors you describe and more.  This reflects an increasingly complex world we live in.  I think a more significant trend is convergence. 

By that I mean that more and more, social services, community services and other community organizations are claiming a stake in the economic development playing field.  Economic developers used to be considered the sole authority and leader in community growth efforts.  The field was defined mostly as business attraction and retention activities.  Now, however, we are required to be less narrowly focused on those activities and more concerned with total community systems management.  At the same time - and due to so many new entrants in the ED space - we are being forced to define our roles in the system more narrowly.  We are becoming one of many "place managers"  in a community who are simultaneously working to improve the place.

Place management requires a coordinated, area-based, multi-stakeholder approach to improving locations, by harnessing the skills, experiences and resources of those in the private, public and voluntary sectors.  It requires the economic developer to form partnerships with the different stakeholders who are concerned about or engaged with the place. Developing such partnerships takes time and leadership.

Other place managers in our little community alone include all levels of government, main street organizations, chambers of commerce, business associations, mental health agencies, veterans groups, employment agencies, social services agencies such as the United Way, schools and training facilities, colleges and universities, regional ED intermediaries, community foundations, tourism managers, property managers, municipal planners and science park managers. Also, many companies anchored in our place including leading employers, property developers, media companies, energy companies, construction firms and shopping centers.

Increasingly, the places often referred to today as the most successful are seen as the result of skillful place management. The implications for economic developers is profound.  It requires reaching out to other place managers to incorporate their activities into your own, to define more fully your organization's role in place management and to be more proactive in leading change.  It also provides an opportunity to position the EDO as a leader in the emerging place management movement or risk being marginalized as leaders from the other place management entities step in to to fill the void.  

Cities eye economic development alliance

Pat Kimbrough

 

City leaders go out of their way to praise High Point’s economic development efforts.

They point to a long list of success by the High Point Economic Development Corp. recruiting new businesses and fostering expansions of existing companies.

So why would High Point want any part of a possible countywide economic development coalition that is now the subject of discussion among local government leaders?

In short, officials said it could enhance the region’s chances of landing a major project like an auto plant, without diminishing local recruitment functions.

“I think for large projects, something like this could be highly effective,” said Mayor Bill Bencini. “If there is a countywide effort, I don’t see it in any way eliminating High Point’s economic development efforts.” More here.

Selling the cold, Minnesota's tech community welcomes data centers

 Article by: MATT MCKINNEY , Star Tribune

The bracing chill of a Minnesota winter doesn’t make for alluring tourism slogans, but there is an industry beyond dogsledding in which it’s a selling point: data centers.

Selling all that cold air to tech companies that need to keep towers of computers from overheating has become the work of people like Tom Lambrecht, manager of economic development services for the utility cooperative Great River Energy.

“It’s hard to get a professional volleyball league to come up here, but we can get a data center,” said Lambrecht.

That’s the hope, anyway, of an increasing number of Minnesota cities from North Mankato to St. Cloud who see a long-term boost to property tax revenues in data centers — the places where all of the information on the Internet gets stored.  More here.

WEDC sings virtues of Wisconsin to national business leaders

BY JAMES LAWSON
jlawson@kenoshanews.com

After two consecutive years of economic growth, the Wisconsin Economic Development Corp. is pumping up the volume on its marketing program and hoping that business decision makers are hearing why they should bring their companies to the Badger State.

WEDC, an organization that has replaced the state’s former Department of Commerce, began a marketing program in July 2011. Each year since, it has added a new element in an attempt to attract more business to the state.

The first two campaigns focused on branding, informing the national and regional business community what WEDC was about and that the state was open for business, according to spokesman Mark Maley. Those campaigns may have helped to encourage some companies to relocate and other to expand operations in the state.

This year, the organization is launching a $1.58 million advertising-marketing campaign that features social media, national business and trade publication advertisements, online marketing and focused radio ads touting the benefits of relocating to Wisconsin.

The radio ads will run on select stations in the Twin Cities and in Chicago.

“This is more hard-hitting,” said Kelly Lietz, WEDC vice president of marketing. “Though there is some national reach, the border states are important. We’re running the radio ads in these cities because Illinois is a prime market for us. While a number of companies have relocated from Illinois over the past couple of years, Minnesota also is an important market for us.”  More here.

Missouri’s Economic Development Organizations Nationally Rank as Best in Class

The Missouri Partnership and the Kansas City Area Development Council (KCADC) were cited as “Best in Class” for state and regional economic development organizations, respectively, in a new survey of location advisors. While the Missouri Partnership tied for fifth place with Kansas and Oklahoma Departments of Commerce for state economic development organizations, KCADC ranked first among regional economic development organizations.

Conducted every three years since 1996 by Development Counsellors International (DCI), the “Winning Strategies in Economic Development” report tracks trends in economic development to determine the best business climates among all 50 states. Key factors include tax climate, “pro-business environment,” incentives/financial assistance and workforce quality/availability.

The survey also ranked Texas, Florida, Georgia and North Carolina as having the overall best business climates domestically, and China, the United Kingdom and Germany as the top countries for international investment opportunities.

DCI’s 2014 Winning Strategies report collected feedback from 356 corporate executives and location advisors, the greatest response to date. The report assembles the perceptions of business executives throughout the nation on the most effective economic development marketing techniques and strategies. Corporate executive respondents were equally divided among manufacturing and service industries, and nearly a quarter had gross revenues of $500 million or higher.

Albany-Dougherty EDC looks to phase 2 of community marketing campaign

ALBANY — As they bask in the embers of the afterglow from their award-winning “There’s Only One Albany” marketing campaign, members of the Albany-Dougherty Economic Development Commission face a daunting question.

What’s next?

EDC staff and board members started the process of finding an answer to that question at the commission’s monthly board meeting Wednesday morning.

"We don’t have an answer today, but it’s something we need to start thinking about,” EDC Chairman Jay Smith said after Economic Development Commission President Justin Strickland and Vice President Barbara Rivera Holmes recapped the marketing campaign that is winding toward its six-month conclusion.

Strickland told the board continuation of the campaign is vital, but he said the questions now are who will drive the campaign into a Phase 2 and who will finance it.  More here.