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Brand Germany

Made in Germany

 

The world view of Germany, and what this means for local brands

 

Germany has climbed one position in the annual Best Countries ranking, taking third place from the UK in the 2018 league table.

The country has a strong reputation as an open nation, with a strong commitment to gender equality and government transparency. Germany’s gains in the ranking have come about in part as a result of weakening confidence in the UK, which has been negotiating the terms of its departure from the European Union.

Germany’s continued strong showing in the ranking reflects the positive way in which consumers and business leaders regard it against a range of key attributes – not just economic power but “soft power” qualities such as compassion and innovation.

Germany ranks #3 out of 80 countries assessed in 2018 in the Best Countries ranking.

 

The annual Best Countries ranking measures global perceptions of countries against a series of attributes – impressions that have the potential to drive trade, travel, and investment, and directly affect brands. It was developed by WPP’s VML Y&R BAV Group, and The Wharton School of the University of Pennsylvania, with U.S. News & World Report. The ranking is revealed each year at the World Economic Forum in Davos, the world’s largest gathering of global leaders and heads of industry and influence.

 

The ranking is based on a large global survey, which asks a range of people about how they perceive different countries against a range of key attributes.

 

Impressions of a country matter immensely to brands because the feelings people have about a place are projected onto the brands that come from there. This, in turn, affects what people are likely to buy, and how much they’re willing to pay for it.

 

This is why labelling olive oil “Produce of Italy” commands a premium, as does “Made in France” when applied to fashion. Likewise, the words “Designed in California” add a certain cache to a range of personal electronics that are “Assembled in China”.

 

Just as countries perform an ambassadorial role for the brands they’re home to, brands also perform the same role for their home country. Samsung has helped reshape international views about South Korea, for instance, Sony has done the same for Japan and Japanese products. The reason German cars sell so well around the world is that people believe in German design and engineering – in a large part because of brands like BMW, Mercedes-Benz, Audi and Volkswagen.

 

How people feel about a country and its brands can, therefore, change over time, depending on the behavior of governments, brands and populations. When all parties are aligned on what they want to stand for abroad – and work together to ensure they deliver on their promises – great things can be achieved. Strong countries fortify strong brands, and the same applies in reverse.

 

How the world views Germany

 

Germany leads the world when it comes to innovation. The place where the car was invented – and repeatedly reinvented ever since – it is also the birthplace of contact lenses, Christmas trees, bicycles, jeans and gummy bears.

German engineering and efficiency have become legendary, thanks largely to the continued reliability of its brands. This, along with strong perceptions around innovation, have led Germany to the top of the Best Countries sub-ranking on entrepreneurship.

Germany is first for entrepreneurship out of 80 countries, followed by Japan, the US, the UK and Switzerland.

This reflects how well-connected Germany is to the rest of the world, the standards of education among its workforce, the availability of capital and skilled labor, transparent business practices, well-developed infrastructure and well-developed legal framework.

Germany is also gaining a reputation internationally for its political and economic leadership, particularly within the European Union, where it is the largest economy; long-serving Chancellor Angela Merkel is a readily recognized figure on the world stage.

Perceptions of the country are also evolving as a result of the government’s willingness to accept refugees from countries affected by war. While somewhat controversial domestically, the policy internationally adds to Germany’s reputation for openness and its promotion of social justice.

What Germany seems to be lacking, however, is approachability. Its scores for being friendly and fun are some way down the rankings; German brands could work on presenting a warmer, more welcoming image as well as focusing on traditional German areas of strength.

 

 

How do we measure a country?

 

The Best Countries 2018 ranking incorporates the views of more than 21,000 individuals surveyed in 36 countries in four regions: the Americas, Asia, Europe, and the Middle East and Africa. These people included a high proportion of “informed elites” – college-educated people who keep up with current affairs – along with business decision makers and members of the general public.

 

Respondents are asked about the 80 countries that feature in the 2018 ranking; between them, these countries account for about 95 percent of global Gross Domestic Product, and represent more than 80 percent of the world’s population.

 

People surveyed for Best Countries are asked how closely they associate 65 attributes with a range of countries. These attributes are then grouped into eight categories, which are used to calculate the Best Countries ranking:

 

The 8 elements of a country’s brand

 

Adventure: a country is seen as friendly, fun, has a pleasant climate, and is scenic or sexy.

 

Citizenship: it cares about human rights, the environment, gender equality, is progressive, has religious freedom, respects property rights, is trustworthy, and political power is well distributed.

 

Cultural influence: it is culturally significant in terms of entertainment, its people are fashionable and happy, it has an influential culture, is modern, prestigious and trendy.

 

Entrepreneurship: it is connected to the rest of the world, has an educated population, is entrepreneurial, innovative, and provides easy access to capital. There is a skilled labor force, technological expertise, transparent business

practices, well-developed infrastructure, and a well-developed legal framework.

 

Heritage: the country is culturally accessible, has a rich history, has great food, and many cultural attractions.

 

Open for business: manufacturing is inexpensive, there’s a lack of corruption, the country has a favorable tax environment, and transparent government practices.

 

Power: it is a leader, is economically and politically influential, has strong international alliances and a strong military.

 

Quality of life: there’s a good job market, affordable living costs, it’s economically and politically stable, family-friendly, safe, has good income equality and well-developed public education and health systems.

 

Each of the eight measures is given a weighting in its contribution to the total score for each country, as follows.

 

The weight of each category in the final index is determined by the strength of its correlation to per capita GDP (at purchasing power parity). As seen in the graphic below, a nation focused on providing great quality of life for its people, which cares about rights

and equality, and has a focus on entrepreneurship, is seen as having the most powerful nation brand. This reflects how the world has changed; no longer is it just tanks and banks that give a country influence around the world. Hard power is making way for softer power that comes about as a result of entrepreneurship and cultural exports.

In addition to the eight categories above, a momentum metric called “Movers” represents 10 percent of the index, measuring how different, distinctive, dynamic and unique a country is seen to be.

To see the full Best Countries methodology, visit:

https://www.usnews.com/news/ best-countries/articles/methodology

 

 

Switzerland tops the ranking as it is highly regarded for its citizenship, being open for business, for having an environment that encourages entrepreneurship, offering its citizens a high quality of life, and for being culturally influential. All of the other countries in the top five also score highly across all of these measures. Canada is especially strong on the citizenship measure. Germany has a similar Best Countries profile to the UK, though Germany is stronger on entrepreneurship and is seen as offering a better quality of life. Japan’s greatest strength is also entrepreneurship, but it also scores highly across all the other measures.

 

 

Tourism matters a great deal to the development of a country brand, and not just because tourists buy things when they’re on holiday. The experiences that visitors have while in a country are instrumental in reinforcing or challenging what they thought before they arrived about a whole range of aspects of that country. Do the trains run on time? Are the people they meet friendly? Does their visit cost more or less than they’d budgeted for? These questions affect overall impressions of a country’s infrastructure, general reliability, trustworthiness and personality. In turn, these impressions color future expectations of that country’s products and services. If you used public transport on your holiday and every train you took broke down, you’d be unlikely to buy an expensive watch from that country a few years later. Similarly, if you saw unsanitary conditions and pollution, you might reasonably think twice about the food you buy.

 

Growth in visitor numbers to Germany is currently outpacing the global average, according to the World Tourism Organization. While the average annual increase in tourist arrivals globally is a little under 4 percent a year, the rise in Germany in 2017 (the latest figures available) was 5.3 percent. Since 2013, visitor numbers have risen 18 percent, and in 2016, more than 37 million people arrived in the country, WTO figures show.

Surpassing expectations

German brands can make most of what their country brand already represents in the minds of international consumers, and at the same time contribute to what “Made in Germany” stands for. Brands can use their country of origin to greatest effect when they align with values and positive attributes already associated with that country.

 

A focus on the following attributes will chime with what consumers around the world feel German brands can offer.

1 Leadership – Germany’s strong global connections and its leading position in Europe and in global politics gives German brands leverage to position themselves as category leaders with an international outlook and influence to match.

2 Innovation – For over a century, Germany has been at the cutting edge of design and manufacturing, something that German brands have reinforced. Brands that highlight their innovation credentials will feel authentic to international buyers.

3 Technical excellence – Respected German brands across a range of sectors, from fashion and beer to cars and appliances, have secured Brand Germany a place in consumers’ minds as the source of world-beating quality.

4 Advocacy for environmental and social justice – Germany is increasingly becoming known for its focus on green issues, thanks to national policies promoting clean energy, and the population’s propensity to buy organic, recycle waste, and cycle to work. The country’s recent stance on immigration signals openness and fairness. These all reflect well on brands with a green or social mission.

5 Value that justifies a premium – German goods and services aren’t expected to be a bargain; in fact, the opposite is true. Yet there is a clear feeling that it’s worth paying extra for “Made in Germany”. The premium pricing is reassuring, and links to expectations of quality and longevity.


Making it work

Germany Trade & Invest (GTAI) – the country’s foreign trade and inward investment agency – has launched a global campaign to encourage enterprises from around the world to see Germany as an appealing place in which to do business.

The “Germany Works” campaign promotes the sectors in which Germany has traditionally been strong, such as automotive and logistics, as well as newer areas of expertise, like green energy, life sciences and “smart” machinery.

At the heart of the campaign is an animated video depicting an engine driven by a range of different areas of strength, all working in unison. It describes Germany’s “permanent quest for better solutions”, and will be promoted online in videos and online banners, as well as in print titles such as The Financial Times and New York Times, and on TV networks including the BBC, Bloomberg and CNN.

GTAI CEO Dr Robert Hermann says: “Germany not only meets all the requirements for reliability among business partners and public stakeholders, but it also stands for dynamism, drive and innovativeness. The campaign does an excellent job of knowing how to convey just how reliable Germany is as a business location.”