Is Brand USA another Banana Republic?

While at lunch today, my companion began to explain how the current economic meltdown has more or less bypassed Central and South America.  The countries there had been through so much economic turmoil of their own over the years that local companies had acquired a certain immunization against the shock.  So the local companies continued to spend on marketing including branding and advertising.

My companion when on to bemoan the situation here in the US.  He observed that US companies are in a state of shock.  They don’t know how to maneuver through economic disaster.  Marketing has been particularly hard hit.   He said that the US has a lot to learn from Latin America.

That got me to thinking.  The stereotype of Latin American countries is a banana republic.  By contrast the USA was the large rich country to the north.   To shed their banana republic image a number of countries, such as Mexico, have undertaken branding efforts to change their image.  They engaged in nation branding.

For many years travel destinations, such as Bermuda or the Virgin Islands, have spun their own brand stories.   The idea of creating branding for travel destinations has gradually spread to other geographies from cities to states to entire countries. This is often known as “place branding” or “destination branding.”

Instead of giving my own definition, I defer to the collective wisdom of Wikipedia for one:

Place branding (also known as destination branding, place marketing or place promotion) is a relatively new umbrella term encompassing nation branding, region branding and city branding. The term was first developed by Philip Kotler,  and was further researched by Gold and Ward, Simon Anholt, Avraham and Ketter,  Seppo Rainisto, and others. The term “place branding” could refer to a city, country or a tourist destination, and to their competition for tourists, visitors, investors, residents and other resources.

When it comes to nation branding, a good example are the recent campaigns to shape opinion of Hugo Chavez’s Venezuel 

Larger, richer countries have generally not indulged in actively shaping their reputation through the tools of branding.  We can hypothesize several reasons including the already strong reputations of the richer countries and public antipathy to wasteful spending of taxpayer dollars.  

Certainly both of those reasons applied to the USA for many years.  

Then a curious thing happened.  Following the events of 9/11, the Bush administration hired the advertising phenom Charlotte Beers, the retiring chairman of advertising agency J. Walter Thompson.  Her job was to elevate Brand USA.  

How successful was she and the others who followed in her footsteps?  

Not very.  Judging by Simon Anholt’s annual survey, the efforts were duds.  Brand USA has slipped into 7th place while Brand Germany has captured the coveted number one spot.  

You might even say that Brand USA is taking on characteristics of a banana republic.  Our reputation is dropping fast.  We are running huge deficits (actually the deficits are huge numbers but a relatively small percent of annual GDP).  We are seeing the nationalization of major industries such as banks and automotive companies.  High unemployment.  True, the analogy isn’t perfect, but it is useful for understanding our situation today.  

Which brings me back to my lunch and my friend’s observation that US companies could learn a thing or two from companies in Latin America.  Yes, he is right.