We can establish the degree of development of a country as a function of the degree of development of its brands, the stronger these are, the stronger the country brand. In fact, those countries that have strong businesses and personal brands in other countries are mostly those with a stronger country brand abroad.

A brand is not only about communication, advertising, promotion and public relations, but also, above all, about the associations which citizens, clients, employees and others make from it. Brands no longer belong to people, countries or companies, but to their stakeholders, who use, consume and enjoy them.

Current problems with the ‘Spain’ brandSpain depends 90% on services, especially those related to tourism, but, on the other hand, it is placed 66th on the world ranking for customer orientation. One of the country’s main problems today is the lack of a clear and defined strategy that

aligns objectives and resources with stakeholder expectations. A brand is also a dream, an aspiration to fight for, an idea to create and fill with content in the minds of interest groups, and Spain as a country has lost this, born originally during the transition to democracy in the 70s, and must now bring back to life a new common dream if it wants to recover its brand, according to Javier Rovira, partner and Director of Know-How Consumering and Professor at ESIC Business & Marketing School.

Some ideas to define this strategy, move on and make way for a new era in the history of Spain include putting an end to the idea of the two conflicting Spains which lingers since the Spanish Civil War – even before then –, mentally abandoning the paradigms and mentality of the 19th century – also before then – and recover that common dream, that shared ambition which is lacking at this moment.

Likewise, it is necessary to deeply reform and reduce the public administration, eliminate the significant

Spain is a mature country, with a current high risk that it will get through in time but, above all, with an opportunity as a country, an appeal that is presently low. Can reputation become the necessary lever to activate the brand of Spain and overcome the present internal and external loss of confidence in the nation?

Strategy DocumentsI12/2011

The new Reputation Economy and the recovery of the ‘Spain’ brand

Brand

Insights

Document prepared by Corporate Excellence with reference to, among other sources, the intervention of Javier Rovira (partner and Director of Know-How Consumering and Professor at ESIC Business & Marketing School), Angel Alloza (CEO of Corporate Excellence – Centre for Reputation Leadership) and Borja Puig de la Bellacasa (Managing Director of Bassat Ogilvy PR in Spain) during the conference “How to build a country brand” organized by ESIC Business School in Madrid in October 2011.

Insights 2

The new Reputation Economy and the recovery of the ‘Spain’ brand

black market in the Spanish economy that still exists and retrieve a truly single market, regardless of the logical cultural and historical differences that enrich the entire country, as proposed by Rovira.

Finally, the ESIC Professor considers that the transparency needed to explain the current situation to citizens and markets (Spain will maintain, as will other countries, a Welfare State that is possible and not one that was desirable until recently) is also essential, as well as reflecting deeply about human capital and talent (both from a lack of resources perspective due to unstoppable ageing, as from its own management, the redistribution of time and labor, education and training, etc).

A new, more competitive DNASpain is underdeveloped – as well as in talent management – in terms of technological development and in its practical application. Its competitive profile is undefined and, in any case, high risk.

It is possible that the country has been left half-way though its political transition, but especially so in its economic transition from an agricultural model and subsequently industrial, to one of services from the 80s with strong de-industrialization and disinvestment from land, but also with a lack of commitment towards high value professional services and the industry of the future, based on leading technology applied to telecommunications, health and energy. This European country needs a new more competitive DNA for its brand, based on thriving companies that will drive innovation, equally thriving industries that will clarify the mystery surrounding Spain’s new economic model and skills that will achieve all this through another route, as well as a truly productive R&D.

Can reputation be a way to manage this process of change and lead the ‘Spain’ brand towards more advantageous and competitive positions, in terms of innovation, talent and future, bearing in mind the direct relationship of reputation with the medium and long-term? In what way can the new science of reputational management, based on gaining, investing and developing trust with stakeholders via a direct relationship with them, contribute to pull Spain out of its present situation?

The Spanish economy of ReputationSpain is known for its ‘softer’ variables (leisure, lifestyle, culture, natural environment), directly linked to a country essentially valued as a good place to live, visit, even study, but less so to buy, work and, above all, invest (more related with ‘hard’ variables such as the economic environment, technology and the importance of its companies). This is confirmed in the study undertaken by the Institute of Intangibles Analysis and developed

by the Reputation Institute in the ‘Reputation of Spain in the world in 2010’. The reputation of a country has a direct relationship with the supportive behavior towards it, a good country reputation leads to a greater intention to visit it, buy its products or services, invest, study, live and work in that country, as we have already mentioned.

Source: Institute of Intangible Analysis, 2010.

Spain’s reputation abroad 2010

Attribute Position

Leisure and entertainment 3th

Lifestyle 6th

Culture 7th

Natural environment 11th

Global commitment 14th

Social welfare 15th

Political and institutional environment

16th

Brand and recognized companies 17th

Quality of products and services 18th

Technology 20th

‘A country brand

is also a dream, an aspiration

to fight for, an idea to create and

fill with content in the minds

of the country’s

interest groups.’

And positive behavior has an influence on elements of the economy, such as a greater number of visitors, more capacity to attract talent or capital, increase in exports and reduction of the current account trade deficit (the difference between the value of exports and imports as a result of the balance of trade, etc).

The reputation of the country brand is a strategic key for business excellence, according to Angel Alloza, CEO of Corporate Excellence – Centre for Reputation Leadership. A good reputation generates a feeling that links and makes friends abroad (defenders), generates respect, trust, esteem and admiration. A bad reputation, however, increases the number of enemies (detractors) or, al least, reduces the number of friends outside the country’s borders. Likewise, reputation is an invaluable tool when it comes to recovering trust (which is based both on rational and emotional aspects), competing in better conditions and finally creating value. Furthermore, the increasing interconnection between the stakeholders of a brand makes reputational management ever more difficult, and adds value to the advice given (positive or negative) and the influence of third parties in the behavior of others.

For this reason, it is essential to analyze the origin of the favorable or unfavorable behavior towards Spain, a behavior that will then have a clear relationship with decisions of purchase, recommendation, support, investment or protection

Insights 3

The new Reputation Economy and the recovery of the ‘Spain’ brand

Puig de la Bellacasa, Managing Director of Bassat Ogilvy PR in Spain. In his opinion, the public-private collaboration will be key in making Spain a common territory that must be supported and defended abroad. The role of the Government is essential when building and rebuilding a country’s reputation.

To achieve this, it is important to listen to what is being said about your country, how they see you, analyze and correctly identify the true problems and plan a decisive and ambitious strategy, at the same time suitable and adapted to different territories and fields. Because one cannot develop the same country brand strategy for Spain in Africa, Asia or Latin America, where perceptions are very different, as indicated in several studies.

In Puig de la Bellacasa’s view, we must move on from the Spain of the Black (the Black Legend), which we recently thought we had left behind but which has returned due to the crisis, towards the Spain of the Red (the shirt color of the national soccer team), the joint successes, the team work and common effort.

at times of crisis such as now. The reputation of a country, as with a company, is based on the direct experience that stakeholders have of it (what the country does and the experience it generates), what the country communicates (what it says of itself) and what others say about that country (third party opinion). The greater the recommendation, the greater the reputation, is always a directly proportional relationship.

Curiously, Spain’s reputation abroad, despite current circumstances, is better than what is perceived internally by Spaniards themselves. Spain’s general evaluation is placed – according to the 2010 Reputation Institute report mentioned before – above those of the US, Japan or the UK.

On the other hand, there is also a relationship between the improvement in reputation of a country and the improvement of its international companies. Reputation is a non-financial indicator linked to the creation – or destruction– of economic, but also social value. It is the territory of competitiveness in which a long-term vision, based on a transversal focus without silos, is allowed to improve the ratio by which countries are compared and assessed within the global environment in which we find ourselves.

Conclusion: public-private collaboration to improve reputationAnd in order to navigate with success in the new reputation economy, it is essential to involve the public area in this joint task, according to Borja

Source: Institute of Intangible Analysis, 2010.

Country reputation ranking

Swed

en

Can

ada

Aus

tral

ia

Swit

zerl

and

Nor

way

Aus

tria

Hol

land

Bel

gium

Ger

man

y

Spai

n

Japa

n

Irel

and

Uni

ted

Kin

gdom Ital

y

Gre

ece

Fran

ce

Port

ugal

Sing

apor

e

Bra

sil

USA

.

Pola

nd

Indi

a

Finl

and

Den

mar

k

Countries in the Top 5

Countries with a similarly valued reputation as Spain

76,3 75,6 75,6 75,3 74,4 73,1 72,269,0 68,4 68,0 68,0 67,5 66,2 66,1 65,3 64,9 64,8 62,7 61,8

55,8 55,553,5 52,1 51,8

‘Curiously, Spain’s

reputation abroad, despite current

circums-tances, is

better than what is

perceived internally

by Spaniards

them-selves.’

©2011, Corporate Excellence - Centre for Reputation Leadership Business foundation created by large companies to professionalize the management of intangible assets and contribute to the development of strong brands, with good reputation and able to compete in the global market. Its mission is to be the driver which leads and consolidates the professional management of reputation as a strategic resource that guides and creates value for companies throughout the world.

Legal NoticeThis document is property of the Corporate Excellence - Centre for Reputation Leadership and has as its objective to share business knowledge about Brand, Reputation, Communication and Public Affairs Management.

This document is directed exclusively towards its addressee and contains confidential information, subject to professional secrecy, whose disclosure, copy or non-authorized use is against the Law. If you receive this document by mistake, let us know immediately and erase it without keeping a copy.

Corporate Excellence - Centre for Reputation Leadership is the owner of all the intellectual property rights of the images, texts, designs and any other content or elements of this product and has the necessary permission for its use, and therefore, its copy, distribution, public release or transformation is prohibited, without express authorization from the owner.