Impacts of Nation Branding
Nation branding is a concept that covers issues that concern countries; like positive public image, reliability and other key issues. The politeness of a nation and its image are more influential in nation branding efforts than military strength and economic strength. Nation branding is connected directly with the attitude of our country and the feelings of people in foreign countries regarding Korea and the value of our products. Korea is the world's 13th largest economy, but the status of the nation when it comes to image is 20th. Obviously there is a large gap between the two rankings. Many countries are overcoming limitations in Hard Power by concentrating on Soft Power. Hard Power is represented by physical power like using military strength or economic sanctions to influence global policy. These methods have been in practice since the Industrial Revolution. Soft Power refers to winning the hearts of other countries through merit and voluntary agreements. Nation branding increases both the internal and external status of a nation. Nation branding also raises the image of a nation's products, helps to expand investment, and vitalizes the tourist industry.
Korea Nation Branding
Evaluating the effectiveness of Korea's nation branding is being done by the Country Brand Index. They go by NBDO (National Brand Dual Octagon) and research is done by the Council on Nation Branding and SERI (Samsung Economics Research Institute). They calculate their findings based on eight items and 125 statistical categories like economy, industry, science, technology, infrastructure, government efficiency, traditional culture, nature, modern culture, people, and celebrity status.
On December 14th, 2009, the Country Brand Index of Korea ranked 19th based on tangible assets and Korea was 30th in image. Economy, corporations, science, and technology ranked high, but traditional culture and infrastructure which forms the basis of economic activity received poor marks. Image evaluation is divided into two areas judged by domestic and overseas sources. Korea ranked high in traditional culture and nature, but the status of its celebrities scored low overseas.
On the other hand, the value of Korea's nation branding ranked 10th based on results released by the IPS (Industrial Policy Studies). Korea's brand power has risen due to Ki-Moon Ban who is the UN Secretary-General and sponsorship of the World Cup in Germany. Korea hopes to further raise its image abroad by initiating Visit Korea Year from 2010 to 2012. In order to continue taking steps to create equality in Korea's value ranking and tangible assets ranking, we have to create more programs.
What the Government needs to do
Korea introduced Dynamic Korea as a national brand when it hosted the World Cup in 2002. However, Korea focused on physical promotion, so there was a weak response to the campaign. Because the Prime Minister's Council on Nation Branding was initiated on a temporary basis at that time, they failed to systemically build the brand. The collaboration of related departments and management policies were insufficient because the primary department in charge did not adequately execute their role. In order to overcome these shortcomings, the government established the Presidential Council on Nation Branding in January, 2009. The Council is dedicated to improving Korea's dignity and status. The Council operates a control tower of pan-government, related departments, and streamlines all processes. They will promote cooperation and expand the participation of the people.
To raise Korea's brand value, foreigners will also play an essential role. Korea continues to be the only divided country in the world and this is a source of negative recognition that offsets positive images created by Korea's economic miracle. The Korean Wave also helped to improve the image of Korea, but its effect is waning because of the absence of follow-up efforts.
The Korean Wave also created hostility from the Chinese government and entertainers. Actually, there was an anti-Korean Wave. Chinese people have positive feelings about Korean dramas, but the Chinese government and entertainers still maintain negative feelings. The Chinese government has placed restrictions on the Korean Wave to prevent the diffusion of Chinese culture.
Our nation uses Arirang TV and Korea Net to advertise to foreigners. However, for Arirang TV and Korea Net, the main viewers are overseas Koreans. Therefore, to raise our foreign image, we need to increase the number of volunteers overseas. Korea is already one of the largest overseas volunteer dispatch countries in the world. In April, 2009, World Friend Korea Program, which was dispatched by KOICA (Korea International Cooperation Agency), held a ceremony. More alternative ideas instead of the Korean Wave are also under development.
Due to its rapid economic turnaround and development Korea has become a role model for many underdeveloped countries. On November 25th, 2009 Korea joined DAC (Development Assistance Committee) which has been called the advanced country aid club. Korea became the prime example of a country that changed from being an aid recipient country to an aid giving country. The giving of humanitarian aid is the responsibility of all developed nations, and Korean people have shown positive reactions about giving assistance. However, there are some negative reactions to the increasing scale of the assistance being given. Any assistance activity has to be done with the approval and sympathy of the people. To that end we have dispatched economic advisors to 11 countries. They hold economic development forums and culture events so that these countries might someday no longer need assistance. The first country was Vietnam in 2010.
Korea's economic growth has been based a great deal on technologies developed by Korean corporations. However, the recognition of Korean corporate brands is lacking. The Council on Nation Branding surveyed 1000 American university students about some Korean corporate brands. 56% of those surveyed said they thought Hyundai was a Japanese company, while only 25% said they thought Hyundai was a Korean company. 58% also said they recognized Samsung as a Japanese company, and only 10% knew Samsung is a Korean company. This survey shows that the number of people who know these goods are made in Korea was small compared to those who didn t know. The Council on Nation Branding hopes to alter this shortcoming by running TV commercials that promote Korean technology on the BBC and CNN. These advertisements highlight the biggest building in the world built by Samsung C&T (Construction & Trading), the largest cruise ship made by STX, Hyundai Heavy Industries, and the Watch Phone by Samsung and LG. The Korean government uses 3.4% of GDP for research and development funds.
What Corporations need to do
In 2005, Anholt GMI (International Nation Brand Rating Agency) said that Korea was 14th among 35 countries in science & technology, and in 2006, Korea rose to 11th. A survey of the National Brand Map showed that 2,089 people in 21 countries who knew about Korea thought of Korea as a dynamic, high-tech country. This image was based on Korean made goods, large enterprises, and technologies like IT semiconductors, home appliances, and cell-phones. However, there is still a problem with recognition of Korean companies. 66% of people in Canada, 34% in England, 42% in India and the Philippines, 24% in the U.S., and 20% in France do not know that Samsung is a Korean company. Therefore, the Korean government has decided to initiate the "Hidden Champion" campaign. This campaign promotes top, small and medium sized enterprises on the world parts market, and advertises our technology.
One successful example is Daewoo Electronics. They establish economic prices and developed Tank Principles (making hard goods like tanks) seperate from other enterprises. They also have increased direct distribution and have agreed with local agents to promote friendly recognition of their company. Finally, they now have 25 corporate sales departments, 20 overseas production corporations, 30 network governors and institutes. Because of this, Korea has achieved a high level of recognition in the fields of home appliances and enterprise. Although Korea has achieved these results, there needs to be more effective strategies to raise the nation brand. Thus far, only the government has actively employed policies and events such as the World Cup. Therefore private enterprises have to do more now because the government has controlled policies for the nation for too long.
There are several things that corporations can do. First, there is high technology development. Enterprise should construct a circulation system between the government and private corporations. They also need to think about ways to develop marketing strategies to improve their individual brands as well as the national brand. They should also find and cultivate new luxury goods that will be in demand in every country.
Second, they need to more effectively advertise their products. Merchandise that is distributed globally should be advertised through global media resources such as CNN and the BBC more often. However, this method isn't used well because of demarketing. Nowadays, we are not faced with a lack of products but a lack of customers. Most industries make more goods than customers that can buy them. This overproduction comes from the idea that companies must meet market share. This situation followed over competition and then this situation followed aggravation of income for each enterprise because of their efforts to lower prices. Another way to make fresh advertisements is carrying the label "Made in Korea." Excellent small and medium sized enterprises are given the KOTRA Seal of Excellence by KOTRA. This system provides an assurance of excellence that will help to open up overseas markets.
Third, enterprises should also concentrate on localization. The easiest way to achieve this is benchmarking from enterprises that have successful achievements worldwide. The large corporations need to dispatch field investigation teams to local markets, so that they can understand the culture and lifestyle of the people in these localities for effective marketing. There should also be an effort to make social contributions as well as merchandise production. If corporations manage to attain harmony with the local people and ethically run their businesses, we can build both a good image of Korea and a positive social image of its enterprises.
However, these methods can be thought of as marketing strategies to raise the net profits of enterprises, but Korea won't be successful in making a national brand overseas until it has successful enterprises. Therefore, to have successful enterprises worldwide they need to improve and become global leaders. In conclusion, Korea should support its enterprises to become the best in the world.
What People need to do
A research institute, Anholt gmi surveyed the nation brands index (NBI) in 2005. According to this survey, Korea ranked 30th of 35 countries in people based on hostility, hospitality, exclusivism and number of friends etc. The cause of these problems comes of the country's exclusiveness which includes regionalism, school relations, and kinship. According to the Universal Human Rights Report issued in 2007, Koreans abroad who purchased sex from minor-aged girls was reported by the international media. People of the world were presented with a bad image of Koreans and due to this media coverage the notion of the "ugly Korean" was created. Many of these problems result from insufficient humanity education and practice. Many Koreans also have prejudices toward people from South-East Asia. Another ugly incident occurred when a group of four Korean pickpockets threw a tear gas bomb at Japanese police in 2006 led to international shame.
There are many things we can make the situation better. To begin with, we need to make minor etiquette a part of our everyday lives. "Minor etiquette is not far away, it exists in real life." said Lee Jung-Ah a member of the Bureau of Culture tourism and Global citizenship. Some examples of minor etiquette are waiting at elevator doors and apologizing for bumping into others. Koreans abroad should also reinforce social responsibility. There needs to be recognition that they act as national branding ambassadors. In other words, people need to recognize the importance of our national image.
Finally there needs to be active participation and practice awareness. This is the most important aspect of this effort. We have many places to participate in, but we don't look around to find good places. Some typical examples are the Jeju Environment Olympics in 2012, the IAAF World Championships in Athletics in 2011. The IAAF World Championships in Athletics is among the world's top three sporting events along with the World Cup and the Olympics. The UNWTO General Assembly will also be held in Korea, and it may have a ripple effect of about 15 billion won. Consequently, many countries will participate in various events hosted by Korea. These visitors offer an opportunity for us to take significant steps toward improving our nation's brand.
We may be prone to think that people don't actually affect nation branding significantly. However, if you knew about the unification network of Koreans abroad, you might change your thinking. They have built the foundation of a unification network themselves, and they not only educate foreign travelers, but have also established Korean schools in many countries; Malaysia, Japan, the Philippines and Myanmar just to name a few. Specifically they made an internet homepage Korean.net which introduces Korean history, food and dramas, so that it contributes to the improvement of Korean nation branding. However, web homepage have been established in just four cities (Seattle, San Diego, East Canada, West Canada) of thirty five foreign local conferences in total. Although this business was driven by President Lee Myung-Bak, Korea didn't make an appropriation for it. It also overlaps Korean residents abroad capitalization. Therefore, we need to integrate management to maximize the synergy effect through Koreans abroad unification networks and Korean residents abroad businesses.
Celebrities are also making an effort to improve Korea's brand. The most prominent examples are Yu-Na Kim and Ki-Moon Ban. When Yu-Na Kim won the World Figure Skating Championship, it is roughly estimated that she generated 228 billion won. Her victory has had a positive effect on Korea's image and the image of the companies that sponsor her. Recently, Yu-Na Kim lighted the Canada Vancouver Olympic Flame; soon it will attract attention around the world. Ki-Moon Ban, the UN Secretary General, won the Steppingstone Prize because he introduced a positive image of Korea abroad. Looking ahead, the influence of celebrities like Ki-Moon Ban, Yu-Na Kim and Yong-Joon Bae is beyond our imagination. It proves that individual actions affect an entire nation's brand a great deal.
Celebrities are not the only ones who can have an impact on good nation branding. Koreans abroad who practice minor etiquette will positively impact Korea's image in the minds of foreigners. Volunteer work abroad also has a positive impact. Most Koreans, however, are not aware of the importance of nation branding.
As a result of Korea's great effort at developing the economy we achieved rapid growth. The economy, science, and technology in Korea came out on top, but government efficiency, infra-structure, traditional culture, and the character of the nation suffered as a result. This has had both positive and negative results in the OECD average. To overcome the glossy outward appearance, we should strive to correct our shortcomings and persevere in our efforts to be NO.1