FutureBrand releases results of Country Brand Index – Canada No.1, Australia slips to No. 5

As one of the largest studies of its kind, the CBI is an in-depth study that explores the complexity, dynamics and benefits of how nations manifest as brands. The strength of a country brand is determined in the same way as any other brand – it’s measured on the levels of awareness, familiarity, preference, consideration, advocacy and active decisions to visit or establish a commercial relationship with.  However, the most important factors that truly differentiate a nation brand are its associations and attributes – the qualities that people think of when they hear a place name, or look at a photograph or plan a trip.

  #   Country   +/- 2010                #   Country   +/- 2010   

  1   Canada   No Change           14   Spain   No change   

  2   Switzerland   Up 3               15   Denmark   Up 4   

  3   New Zealand   No change   16   Singapore   Down 1   

  4   Japan   Up 2                        17   Austria   Up 3   

  5   Australia   Down 3               18   Maldives   Down 2   

  6   United States   Down 2        19   Iceland   Up 5   

  7   Sweden   Up 3                     20   Ireland   Down 3   

  8   Finland   No change             21   Bermuda   Down 3   

  9   France   Down 2                   22   Mauritius   Down 1   

  10   Italy   Up 2                          23   Netherlands   Up 2   

  11   Germany   No change        24   Costa Rica   Up 3   

  12   Norway   Up 1                    25   United Arab Emirates   Up 3   

  13   United Kingdom   Down 4  

This year’s leading country brands share some common features. They are all democratic, progressive, somewhat politically and economically stable and have the ability to conduct business in English. As ever, there are rising and falling stars, but position is not the whole story. Themes emerging in 2011/2012 hint at the future drivers of country brand strength, including the importance of value systems and the freedom of communications: a major factor in world perception of a country, its culture, people, businesses and brands.

The Trends from this year’s report include:

1.    The United Kingdom leaves the top ten

2.    Iconic country brands in decline

3.    The paradox of bad news

4.    Canada takes No.1 – why country brand management is important

5.    Latin America on the rise

6.    Small countries can have a big reputation

1.   The United Kingdom leaves the top ten

For the first time since the CBI’s founding in 2005, the United Kingdom does not appear in the top ten, capping off a two-year downward trend for the country’s brand. This is a symbolic fall for the nation, especially following the good press it received for the Royal Wedding in April.

The UK is something of a paradox. For example, tourism represents nearly 10% of the country’s Gross Domestic Profit (GDP) and is second only to chemicals and financial services in terms of export earnings. Visitor numbers for business
and leisure actually increased year to date in the three months leading up to August, and overall visitor spending is up 4% since 2010 but the country has one of its weakest scores in the Tourism dimension – particularly in areas like Value for Money.

Perceptions are also weakening in traditional areas of strength for the country with Heritage and Culture falling five places–a counterintuitive outcome in light of the focus on London’s heritage sites during April’s festivities.

As the United Kingdom looks ahead to 2012, it will surely be hoping that the “Olympic effect” starts to improve low scores in the Tourism dimension, delivering promised “legacy” social improvements and business growth, while reversing a downward trend in perceptions across the dimensions. Hopefully, the country can start to tell a new story about its future and modern life in Britain, counterbalancing an increasing dependence on pageantry and nostalgia to maintain its position in the rankings.

2.   Iconic country brands in decline

The United States drops down another two places to sixth overall this year. The downward trend in brand strength mirrors its troubled socio-political and economic fortunes. However, despite slower than hoped for growth in employment and GDP, the United States has shown some improvement in perceptions around Good for Business–including Regulatory Environment, Skilled Workforce and Investment Climate–rising four places against 2010. It is worth noting that our research was in-field before the controversial downgrade of the United States’ credit rating to AA+ status and the Occupy Wall Street movement that intensified speculation about America’s long-term stability.

Tourism strength is also slightly improved, up six places this year as a result of significantly increased perceptions of Value for Money, correlating to a weakened dollar and highly publicised domestic mortgage defaults across the nation. Next year’s presidential election also brings the potential for the end of the Obama administration or a weakening of its mandate as presidential approval ratings continue to fall, further diluting the “Obama effect” that was a strong contributing factor the United States’ number one position in the 2009 CBI.

France has fallen two places to ninth position, following a drop of the same amount in 2010. This is set against a background of increased turmoil in the European Union as French president Nicolas Sarkozy takes a lead role in attempting to stabilize the Eurozone’s economy alongside Germany’s Angela Merkel. Both the United States and France continue to be among the world’s strongest country brands and show great resilience in the face of these challenges. But their decline year after year–together with that of the United Kingdom– might hint at an inexorable decline in strength.

3.   The paradox of bad news

This year Japan faced one of the most difficult crises the country has faced since the Second World War. Aside from the trauma, loss of life and impact on infrastructure that the earthquake and tsunami caused, its initial estimates indicate that the total financial impact of the disaster could exceed $300 billion. While the country reels from this terrible event and the world watches as its third largest economy struggles to regain momentum, this year unusually sees Japan rising in the country brand rankings – moving up two ranks to fourth place.

In fact, perhaps paradoxically, Japan leapt to number one in the Tourism dimension and moved up five places in Quality of Life. Japan has always been a strong country brand and enjoys enormous popularity as a destination for business and leisure. While visitor figures dropped significantly between March and August 2011, decline is slowing against numbers for 2010 as we approach the end of the year. Both of these cases–like the Chilean Miners’ rescue and the Iceland volcanic eruption in 2010–hint at the positive effect that global news exposure can have on perceptions of a place, regardless of the nature of the news itself. But in Japan’s case, it could perhaps also be argued that enormous latent goodwill and decades of strong reputation building provided an underlying resilience that has helped the country brand survive and even flourish in difficult times. Japan and Chile also prove that the media continues to plays an important role building a country brand’s success and what was once a trend is now a common factor in evaluating country brand’s.

4.   Canada takes No.1 – why country brand management is important

The countries that dominate this years top ten have performed well year after year across every area of brand strength. Interestingly, Canada continues to be the strongest country brand despite its lack of leading rankings in any one dimension–proving that consistency is more important than specialty focus. But Canada’s strength depends on more than just consistency: the nation actively manages its country brand to constantly improve performance. As the United Kingdom prepares to leverage the power of the London 2012 Olympic Games, it would do well to emulate Canada’s treatment of the Vancouver 2010 Winter Olympics, where the event was used as a platform to build sustainable brand strength across every dimension. From the creation of beautiful b-roll landscape footage to the ubiquitous use of the country’s iconic maple leaf, Canada actively made the most of its assets to support a “keep exploring” brand position. This attention to country brand management will be even more important as the country faces its first period of economic decline for two years–shrinking 0.4% in the second quarter of 2011–and consumer confidence drops–a change that correlates to a slight fall in Canada’s Good for Business score.

5.   Latin America on the rise

Latin America has developed a growing sense of regional identity in the last decade. There is a strong will to build towards a shared future, without the need for a common currency. The commercial interchange inside the region is growing quickly, with Brazil as the clear leader. Whilst it is believed that Latin America is opening up to world wide economy, many believe that producing regional goods and rejecting some of the entanglements associated with global free trade has helped the region withstand the damage of global economic crisis.

In terms of country branding, the majority of the countries in this region have been traditionally considered good places to visit. However, planning to live in Latin America has traditionally been seen as much more difficult due to perceived weaknesses around safety, economic stability and social stratification. But two decades of relative political calm have allowed most of the region’s countries to positively and effectively address these negative attributes. Regarding the CBI ranking, there is a first tier of countries leading the region–composed either of nations with a very specific positioning, such as Costa Rica, or larger countries such as Brazil, Argentina, Chile, Peru and Mexico. The stars of Latin America are demonstrating relatively strong performance across all five dimensions, with Chile representing the strong growth over two years, and Brazil rising sign
ificantly as well.

6.   Small countries can have a big reputation

Country brand strength is not a function of geographic size or economic power. China demonstrates this very fact with a fall of nine places to 65th position, despite having the world’s largest population and displacing Japan as the second largest economy.

Conversely, New Zealand, Switzerland and Finland all enjoy top ten rankings and some of the highest scores in the index with populations below ten million. In New Zealand’s case, the country is enjoying high levels of macroeconomic growth in tandem with its continued position at number three in our ranking, despite having the lowest population and GDP of the countries in our top ten. Like Australia, the country continues to prosper as it supplies the resources essential to economic growth in China and other accelerating economies.

As a country brand, New Zealand leads the rankings in terms of perceptions of Natural Beauty and appears in the Value System top ten, but overall the brands suffered in the Good for Business dimension–falling three places to eighteenth position–perhaps correlating to increasingly high housing prices, rising household debts and the after-effects of a devastating earthquake in February 2011.

Switzerland is the real success story in 2011. Maintaining its momentum, the country’s brand has moved from eleventh to fifth and now second position in three years, leading the rankings in the Good for Business dimension and appearing in the top ten for every other dimension except Heritage and Culture. Just as in 2010, positive perceptions of Switzerland’s favourable regulatory environment, infrastructure and value system make it a place people want to visit, invest in and recommend. This, coupled with some of the world’s most beautiful natural attractions, a strong portfolio of national “made in” brands and a stable economy means Switzerland continues to live up to the “plus” in its iconic national identity.

Summary

In summary, the best country brands have strong sense of identity, developed over time and presented consistently across touch points, which is critical to brand success of any kind. Country brand strength is a nation’s ultimate intangible asset and goes beyond its geographic size, financial performance or levels of awareness. Whilst many brands believe a strong economic performance is vital to brand strength, it is not enough to guarantee a high world ranking. It is much more – a strong country brand should make peoples’ lives better.

Individual Top 10 on Key Brand Dimensions

The following pages provide an in-depth look at five key dimensions that make up a country brand: Value System, Quality of Life, Good for Business, Heritage and Culture and Tourism. In order for country brands to perform in today’s increasingly connected world, it is not sufficient to focus on only one dimension. The best country brands have shaped brand images that span multiple dimensions, while the weakest country brands do not have recognisable profiles in any dimension.

Top 10 Country Brands for Value System

1.    Sweden  

2.    Denmark  

3.    Finland  

4.    Norway  

5.    Canada

6.    New Zealand

7.     Switzerland  

8.    Netherlands  

9.    Iceland

10. Australia

Top 10 Country Brands for Quality of Life

1.    Sweden  

2.    Switzerland  

3.    Norway  

4.    Finland  

5.    Denmark

6.    Canada  

7.    Japan

8.    Australia  

9.    Germany  

10. Austria

10.

Top 10 Country Brands Good for Business

1.    Switzerland

2.    Sweden

3.    Germany

4.    Japan

5.    Finland

6.     Denmark

7.     United States  

8.    Singapore  

9.    Norway  

10.  Canada

Top 10 Country Brands for Tourism

1.    Japan  

2.    Italy  

3.    Spain  

4.    United States  

5.    France  

6.    Switzerland  

7.    Thailand  

8.    Australia  

9.    New Zealand  

10.  Maldives

Top 10 for Country Brands for Heritage and Culture

1.    Italy  

2.    France  

3.    Israel  

4.    Peru  

5.    Greece  

6.    Japan  

7.    Spain  

8.    Egypt  

9.    Austria  

10.  India

Methodology

The 2011 Country Brand Index, FutureBrand’s most comprehensive study of country brands to date, surveyed 3500 international business and leisure travellers from 14 countries on all five continents. This research was qualified by in-depth focus groups with experts in 16 major metropolitan areas around the world. And, for the first time in the history of the CBI, this qualitative research was complemented with an onlin
e global crowd sourcing initiative, whereby 50 experts submitted and discussed their ideas and opinions around key questions relating to country branding, in real time. In addition, the number of countries included in the study increased from 110 to 113 this year.

FutureBrand has developed a three-tiered system for examining and ranking country brands. The Country Brand Index incorporates global quantitative research, expert opinions, and relevant secondary sources for statistics that link brand equity to assets, growth and expansion. The result is a unique evaluation system that provides the basis of their rankings and insights about the complexities and dynamics of country brands.

How FutureBrand approached weighting

The overall country brand score is calculated using FutureBrand’s proprietary tool, the Hierarchical Decision model (HDM), which measures overall country brand performance in 26 image attributes across five key association dimensions: Value System, Quality of Life, Good for Business, Heritage and Culture and Tourism.

After seven years of research, FutureBrand knows that these associations are what drives country brand strength, and thus weight in favour of these five dimensions overall. This score is then married with the performance in six other areas of brand strength: Awareness, Familiarity, Preference, Consideration, Decision/Visitation and Advocacy.

AWARENESS: Do key audiences know that the country exists? How top of mind is it?

FAMILIARITY: How well do people know the country and what it offers?

ASSOCIATIONS: What qualities come to mind when people think of the country? Here, we look at five association dimensions: Value System, Quality of Life, Good for Business, Heritage and Culture and Tourism.

PREFERENCE: How highly do audiences esteem the country? Does it resonate?

CONSIDERATION: Is the country considered for a visit? What about for investment or to acquire or consume its products?

DECISION / VISITATION: To what extent do people follow through and visit the country or establish a commercial relationship?

ADVOCACY: Do visitors recommend the country to family, friends and colleagues?

What makes a strong Country Brand?