Portugal as a Brand_Filipe Sá Couto and Guilherme Baptista

PORTUGAL AS A BRAND SALES MANAGEMENT

2016

Filipe Sá Couto 201200211 Guilherme Baptista 201201371

Sales Management Portugal as a Brand

Filipe Sá Couto 201200211 | Guilherme Baptista 201201371

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INDEX 1. Abstract .......................................................................................................... 2

2. Marketing Concept ........................................................................................ 3

3. Brand .............................................................................................................. 5 3.1. Types of Brand ...................................................................................................... 6 3.2. Brand Equity .......................................................................................................... 6 3.3. Brand Knowledge .................................................................................................. 7 3.4. Brand Personality .................................................................................................. 9 3.5. Country Branding ................................................................................................ 10

4. Brand Portugal ............................................................................................. 12

5. Conclusion/ recomendations ..................................................................... 16

6. References ................................................................................................... 17



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1. ABSTRACT The Brand of a Nation also sells. The image of a country is, nowadays, an

important asset for its economy. A brand is a promise made to the consumer; it is the reference point for all impressions, positive and negative acquired over time. Marketing is the tool that must perceive, study and present differentiation factors, must show and convince consumers about the qualities of a product or service.

Currently, the figure in charge of the management of the brand Portugal is the Government, through AICEP, whose mission is to increase the notoriety of Portugal, captivating structural investment and the internationalization of enterprises, mainly small and medium businesses, creating competitive conditions and stimulating exports to the Global Market, diversifying product offer and destination countries.

Some errors have been pointed out in the management of the Portugal Brand, such as lack of strategy and unsuccessful plans, but it is imperative to irrevocably understand that brand assumption and its repositioning is a strategic vector for the development of the Country.

Portugal has good references, either in industry, or services, has product, that help promoting Portugal’s global image and contributing to an increase in revenues, either in exports, Tourism or Direct Investment.

In this work we are going to present some core concepts about Branding to have a better understanding about Portugal as a brand, also, we will talk about the characteristics of brand Portugal and how the brand Portugal is positioned in the market following the model of FutureBrand’s Country Brand Index.



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2. MARKETING CONCEPT Production Concept

Production concept is used since the first stages of capitalism and it assumes that consumers are interested primarily in product availability at low prices, in which the marketing objectives are cheap, efficient production, intensive distribution and market expansion. The basic proposition of the production concept is that customers will choose products and services that are widely available and are of low cost. So the business is mainly concerned with making as many units as possible, the needs of customers are secondary compared with the need to increase production.

Product Concept

Product concept assumes that consumers will buy the product that offers them the highest quality, the best performance, and the most features as opposed to a “normal” product. The company will follow the objectives of quality improvement and the addition of features.

Product concept has tendency toward Marketing Myopia which happens when a company concentrate on selling products rather on meeting customers’ needs. Companies need to take innovations and features seriously and provide only those which the customer needs. The customer needs should be given priority.

Thus companies following the product concept need to concentrate on their technology such that they provide with excellent feature rich and innovative products for optimum customer satisfaction.

Selling Concept

The Selling concept assumes that consumers are unlikely to buy a product unless they are aggressively persuaded to do so, therefore, the marketing objectives are to “Sell, sell, sell” that will more likely create a lack of concern for customer needs and satisfaction. Sales are oriented in a way that follow the selling concept, the more sales calls you make the more likely you will find customers and selling success is a result of effort you spent to convince customers.



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Marketing Concept

To be successful, a company must determine the needs and wants of specific target markets and deliver the desired satisfactions better than the competition and produce what they can sell. The marketing concept believes in the pull strategy and says that you need to make your brand so strong that customers themselves prefer your brand over every other competitor. Needs are the essence of the marketing concept. Marketers do not create needs but can make consumers aware of needs. Motivation is the driving force within individuals that impels them to action. It is what causes us to take action, whether to grab a snack to reduce hunger or enrol in college to earn a degree. The forces that lie beneath motivation can be biological, social, emotional or cognitive in nature.

Companies must see their business as a customer-satisfying process, not a goods-producing process.

Simply put, marketing is the delivery of customer satisfaction at a profit.

Social Marketing Concept

Social marketing concept is a marketing concept wherein an organization believes in giving back to the society by producing better products targeted towards society welfare, in other words, the organization’s task is to determine the needs, wants, and interests of target markets and to deliver the desired satisfactions more effectively and efficiently than competitors in a way that preserves or enhances the consumer’s and the society’s well-being. Critics, however, complain that because related marketing might make consumers feel they have fulfilled their philanthropic duties by buying products instead of donating to causes directly.



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3. BRAND A brand is a logo, sign or set of nominative, figurative or symbolic signs, which

can be words, people's names, words, designs, letters, numerals, the shape of the product or packaging, symbol, design or combination of both, that make distinguishing the goods or services of one undertaking from those of other companies that applied in any way, in a product or in its envelope, inform your origin, do distinguish it from products or services identical or similar, differentiate them from the competition and identify them in an immediate way. It should also be noted that brand is the essence of the product or service is its significance that defines its identity in time and space. A brand is a promise to consumers and is the reference point to all the positive and negative impressions acquired by the consumer over time.

Consumers build an emotional connection with the brand, so it becomes increasingly important the inspiration of marketers to create, maintain, protect and improve product brands and services. Marketing is the tool that will serve as a leverage to create brand value, show and convince consumers of the qualities of a product or service.

Marketing is not a battle of products, it's a battle of perceptions. The power of a brand lies in what resides in the minds of customers – what they learned, felt, seen, and heard about the brand as a result of their experiences over time.

"A brand for a company is like a reputation for a person. You earn reputation by trying to do hard things well."

Jeff Bezos



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3.1. TYPES OF BRAND

The brand is one of the most valuable assets that any institution can have and has a distinctive and differentiating role for product or service. The brand creates value for both consumers and businesses.

There are a lot types of brands but we are only going to explain this three:

• Product brand: products become branded products when you win awareness in the marketplace that your product has compelling characteristics that make it different and better than others in the product category and can be a product or a range of products like such as the Mercedes S-class cars or all the varieties of Colgate toothpaste.

• Umbrella Brand: identifies several categories of very different and complementary products and is used to provide uniformity to certain product lines by grouping them under a single brand name, making them more easily identifiable and enhance their marketability. All products under the same brand are expected to have uniform quality and user experience.

• Place brand – Also known as destination or city brands. This is the brand that a region or city builds around itself in order to associate its location with ideas rather than facilities. Often used to attract tourists, investors, businesses and residents. Recognizes that these groups all have significant choices as to where they choose to locate. A critical success factor is getting both citizens and service providers on board, since they in effect become responsible for the experiences delivered.

3.2. BRAND EQUITY Brand Knowledge is the key to creating brand equity. Companies can create

brand equity for their products by making them memorable, easily recognizable and superior in quality and reliability. The additional money that consumers are willing to spend to buy Coca Cola rather than the store brand of soda is an example of brand equity or the example of Volkswagen where consumers aren’t no more willing to spend more to buy a Volkswagen than a similar car like Renault, now probably consumers are willing to give more for a Renault, in this case the brand is said to have negative brand equity. Brand equity can be measured quantitatively using numerical values such as profit margins and market share, but this approach fails to



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capture qualitative elements such as prestige and mental and emotional associations. Other ways that a brand equity can be measured (these can be used individually or in combination): at the firm level, at the product level, and at the consumer level.

3.3. BRAND KNOWLEDGE

The Associative Memory Model views memory as consisting of a network of nodes and connecting links, in which nodes represent stored information or concepts, and links represent the strength of association between the information of concepts. Brand knowledge consists of a brand node in memory with a variety of associations linked to it. Brand knowledge has two components, Brand Awareness and Brand Image.

Brand awareness is an important way of promoting commodity-related products. This is because for these products, there are very few factors that differentiate one product from its competitors. Therefore, the product that maintains the highest brand awareness compared to its competitors will usually get the most sales.

For example, in the soft drink industry, very little separates a generic soda from a brand-name soda, in terms of taste. However, consumers are very aware of the brands Pepsi and Coca Cola, in terms of their images and names. We were able to see this in a presentation of a college for the course of Consumer Behaviour in which our college done a blind test with us, where he used Pepsi, Coca Cola and generic cola and the results were that the generic cola was the number one choice and Coca Cola the second.

This higher rate of brand awareness equates to higher sales and also serves as an economic barrier that prevents competitors from gaining more market share.

Brand Recognition Is the ability of consumers to confirm prior exposure to the brand when given the brand as a cue and the strength of how the exposition to the brand activates a node in consumer’s long term memory – so that the brand makes sense to them. This can be seen with the Brand Portugal, when we think about Portugal, we link it with good weather, beach, food or Cristiano Ronaldo, etc.

Brand Recall is the ability of consumers to name a brand when given the product category, category need, or some other similar cue. With the example that we gave in brand recognition, people may link those with Portugal.



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Advantages of Brand Awareness

o Register the brand in the minds of consumers o Learning about the brand becomes easier o Likelihood that the brand will be a member of the consideration set o Affect choices among brands in the consideration set

• Motivate choice through perceived differences • Consumer can oftentimes not evaluate quality, but use heuristics and simply

choose the brand they are most familiar with

Brand awareness is vitally important, but, without understanding of what sets the brand apart from the competition, brand awareness can’t help much to understand how consumers form preference, so we also need to understand brand image and brand positioning.

Brand Image is the perceptions of the consumers as reflected by the Set of Associations they hold in their minds when they think of your brand. Successful brands have associations that are strong, positive and unique, no matter their source and how they were formed.

Associative learning is a mechanism by which links or relationships between concepts can be established. An associative network structure of memory consists of patters of nodes (concepts) linked together. In the context of endorsements, both the endorser and brand represent units connected to other units based on our experiences with the brand and the endorser. These connections represent our association set for the brand and the endorser.

By repeated pairings of the brand and endorser, the brand and endorser become part of each other's association set. For the case of Portugal, for example, people associate the image of Cristiano Ronaldo and how they perceive him with Brand Portugal.



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Brand Positioning Strategy establish what the brand stands for and how it will compete vs. main competitors, the way we want consumers to think (rational side) and to feel (emotional side) about the brand. Should be the starting point for all marketing strategies and tactics.

3.4. BRAND PERSONALITY

Brand Personality is the set of human characteristics associated with a brand and allows to measure points of differentiation, represents attributes, but transforms them into Relationship-Relevant Constructs and allows for Self-Expression (“Self-congruity effects”), more a hedonic relational. You measure brand personality using 5 traits, sincerity, excitement, competence, sophistication and ruggedness. Customers are more likely to purchase a brand if its personality is similar to their own, that can be seen with the flow of tourist from Britain to Portugal, that identify themselves with the hospitality, relax and warm of Portugal.

Brand Personality allows Marketers to create brand identity, differentiate their brand from others and study the effects of Marketing actions on brand positioning.



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3.5. COUNTRY BRANDING

Currently we are witnessing a strong competition between countries fighting for the same objectives: to sell their products and services abroad, attract qualified people to the labour market, capture the largest number of tourists, attract foreign investment and promote the realization of international events, like Portugal did for Euro 2004 and Expo 98.

In a global context and great competition, nations have become aware of the result the exterior impact has in its economy and thus tend to create their own national brands. Worldwide, both Governments, economic and social communication office, came to the conclusion that a country's brand also sells and is very important in the decision making of the consumer.

In business, the international image is very important, the country brand has a great influence on your reputation so there is a growing awareness for the importance of making the country branding a drive engine of the economy.

Wally Olins, country branding expert and president of the agency Wolff Olins, says the interest in the country brands is growing very quickly. He worked more than fifteen years with AICEP (Agency for Investment and Foreign Trade of Portugal) and the Metro of Lisbon in 1999 and had already then stated that the promotion of country brand would become a common practice within a decade. It also said that the importance of developing existing brands and export them as images of the country is as high as create new ones that are exclusively for internationalization.

Although opinions differ, with regard to whether a country is also a brand, the reality is that many countries already have a brand. As said Carlos Coelho, founder of Ivity Brand Corp, the affirmation of countries began to be made by the power of its brands, the example of Sweden and Portugal, were the power of the brand IKEA, Nokia and Cristiano Ronaldo enhanced greatly the power of country brand, sometimes people only know the country because of a company or personality. When we visited the EXPO Milan 2015, we talked with a group of people from Asia and they only knew Portugal because of Cristiano Ronaldo, they didn’t knew were Portugal is located, and also we talked with some Americans and they thought that we spoke spanish.

Anholt and Hildreth, in 2005, built a hexagon as a model of building a country brand, which bring together the six elements they see as central to this. The elements identified to be part of a country brand are:

o Tourism: tourism and all the experiences lived by its visitors;



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o Exports: the exports of its most recognized products and services; o People: their leaders, the media, its media stars and the general population; o Government: the policy decisions taken by governments; o Culture and Historical Heritage: the developed cultural activities and its

historical legacy; Investment and Immigration: the strategies they adopt to attract foreign investment and skilled labour.

Branding or brand management is a systematic and multi-disciplinary process where integrate disciplines of management, marketing, human resources, communication and design among others. Its aim is to create an identity for the brand recognized by the segment to be achieved, giving it value and accentuate her continuing basis. It is common sense that building a coherent picture requires hard work.



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4. BRAND PORTUGAL There are some characteristics (in bold) of a “good” brand. Ideally and to be

effective, a brand must be:

• Short – Where “Portugal” is not a short name but is also not very long, which, in this case, does not harm the brand.

• Easy to write and pronounce - Where “Portugal” is quite easy to pronounce in every language because it does not have any difficult phonetics. It also has the big advantage that does not change much when each country translate the name to its own language, helping the writing in this case. For example, in the Portuguese Southern touristic region of Algarve, the Portuguese tourism institution/organization (Turismo de Portugal) made an adaptation with the purpose of advertisement for the biggest group of tourists who come from the Great Britain by constructing and spread all over the region big placards written: “ALLgarve” instead of the real name “Algarve” which both are pretty similar

• Distinctive / Unique - Where “Portugal” is a very original name for a country different from any other else and no other country has a similar name which helps an another possible characteristic that could be the easiness recognize and to remember

• Positive connotation - Where “Portugal” is not associated mainly to bad events, except since 2011 where Portugal faced a big economical and financial crisis which can maybe create associations that the Portuguese people are lazy and do not like to work. In the other hand, still in that field, Portugal has given good signs of recovery and is known as “the good student of Europe” which shows the Portuguese honor to comply with its promises and debts. This reinforces the good quality of Portuguese products and services image leading to a “Clean image” (having no dirty associations) which can be also another characteristic



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• Legally protectable / Able to be registered (possibility to protect the trademark) – Where “Portugal” is a name of a country and by international law no one can used for commercial purposes

• “Timeless” (atemporal/classic) – Portugal is the country name almost “since ever and forever” so we can also say that it is Perennial / Perpetual but, at the same time, Actual and Globalizable.

In a certain way, Portugal is performing better as a brand because Portugal has been improving in the “Country Brand Index” made every year by Future Brand. In this study, in 2011-2012 Portugal appeared in the 30th position in the world wide ranking 2014-2015 Portugal showed up in the 30th position. Citing them “Countries can usefully be understood as the sum of their identity and reputation”. They base their ranking in the Hierarchical Decision Model (HDM) is determining how key audiences perceive a country’s brand. The model is divided in seven areas and each one responds to a question:

Ø Awareness: How well do people know the country and its offerings?

Ø Familiarity What qualities come to mind when people think of the country?

Ø Associations How highly do audiences esteem the country? Does it resonate?

Ø Preference Is the country considered for a visit? What about for investment, to acquire or consume its products?

Ø Consideration To what extent do people follow through and visit the country or establish a commercial relationship?

Ø Decision/Visitation Do visitors recommend the country to family, friends and colleagues?

Concerning these questions, Portugal is not very known by the global population and some even think that it belongs to Spain. But, the ones who know it, certainly know its big personalities. For example, in the sports field: Cristiano Ronaldo, Figo or Eusébio; in the Literature: Luís Vaz de Camões and Fernando Pessoa; in the fashion industry, the fashion designer Fátima Lopes; in the modern art Joana de Vasconcelos. All of them create the “brand Portugal” but as it is a small country it does not attract a lot of attention and does not show up many times in the international media. Besides, when people are willing to choose a travel destination,



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Portugal is not one of the top preferences. However, after trying it, people love it, usually recommend to others and realize that is a good place to make business and settle a new company.

Besides, answering in a broader way to these questions, the “Associations” field is more developed:

STATUS EXPERIENCE

Value system

Quality of life

Business Potential

Heritage & culture

Tourism Made in

Political freedom

health & education

good for business

historical points of interest

value for money

make products that are authentic

environmental standards

standard of living

advanced technology

heritage, art & culture

range of attractions

make products of high quality

Tolerance safety & security

good infrastructure

natural beauty

resort and lodging options

they create unique products

“Would you like to live or study there?”

“Would you like to visit for a vacation?”

“Would you like to buy products made in that country?”

Food

Regarding these criteria, Portugal performs quite well in the 108 analyzed countries (overall 27th place) but not so well in the European scenario, as Portugal in ranked 16th. Portugal has a democratic political system (that does not violate freedom), a good health and education public system, quite good standards of living (having a high level in the Human develop Index), the pollution rates are very low



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and it is a safe country to live in. In the last years it has been introducing more flexible labour laws and taxes in order to improve business and commerce. Therefore, Lisbon is becoming a good place to settle start-ups and high-skilled students come from the recognized universities. Thus, some say that Portugal could become the “California of Europe” for the good weather and business opportunities because some say Portugal is “a garden by the sea”.

The country is also known for its vast and long history as it had a huge empire in the “Descobrimentos” times and, as Portugal did not participate in any of the two world wars, it still has castles, monasteries and churches all over the country. The most popular touristic sites are: Lisbon (with also Cascais and Sintra), Peniche (and Nazaré more recently for surf), Porto (Douro river and valley), Fátima (being a catholic attraction), Coimbra (has one of the oldest universities in the world dated 1290) and Algarve region. Additionally, Azores and Madeira islands have beautiful landscapes. The most known Portuguese mascot is the “Galo de Barcelos”. The prices have a good value for money ratio for lodging and services. Portugal is a very traditional country when it comes to gastronomy – with traditional dishes like: “bacalhau”, “pastéis de Belém” and Porto’s “francesinhas” or a “alheira de Mirandela” - because its own products It very well known for its wines (Porto wine is famous worldwide) and also, it is world leader in producing cork (for the stopper in the wine bottles) and olive oil. The Portuguese habits and traditions mainly come from university traditions, called “praxe” that inspired J.K.Rowling to write the Harry Potter books. Portugal used to produce, the eternal, Citroen model “2cv” in Mangualde city and today it is produced there the Citroen “berlingo” van and in AutoEuropa’s factory in Palmela are produced the Wolkswagen “Sharan”, “Scirocco” and the Seat “Alhambra”, which are cars sold worldwide.

Two other marketing important concepts are the pull and push strategies. Pull Strategies are related to advertising, PR and promotional activities combined to create such consumer demand as to “pull” the product from the existing distribution systems. Push Strategies are related to the strength of marketing channels to “push” the products into wide distribution and display leading to consumer awareness and trial. So, basically push strategies use their sales force by making/offering discounts to push the product to the client. Whereas, pull strategies focus more in advertise.

Until, the Portuguese Expo 98 or Euro 2004, the Portuguese strategy focused much more in push strategies rather than pull strategies. But since then, the “Turismo de Portugal” with the important help of “AICEP” (Portuguese Agency for Investment and External Commerce) started to develop a Portuguese promotion much more concentrated in advertisement and high added value business which can create much more value to the economy.



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5. CONCLUSION/ RECOMENDATIONS In order to improve its country brand recognition, awareness and image,

increasing tourism and business, and concerning a marketing mix approach (product, price, place, promotion and “plazo”) Portugal should invest more in high added value products and services, intending to have higher prices and improve its promotion. For instance, Portugal did not attend the last Expo 2015 which took place in Milan, Italy. Let’s imagine, for example, that if there was a Portuguese delegation representing the country, within the 20 million visitors targeted by the Expo’s organization team, after the fair, only 1% was willing to visit Portugal in the next 10 years. Assuming a 500 euros expense per person when visiting the country, this leads us to an additional 10 million euros to the Portuguese GDP. Besides, the likelihood of some business mans to invest in Potugal would also increase. With the same reasoning, let’s imagine, for example that only 0,1% of the 20 million visitors would invest in Portugal in the next 10 years – that leads us to 200 million euros of foreign investment in Portugal. Portugal could also explore in a better way its geographical privileged position by being the first entrance of shipping goods that come from the Atlantic Ocean and then send them through the rest of Europe by train or truck.



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6. REFERENCES o Slides of the course of Sales Management o http://marketing91.com o http://www.aicep.pt o http://www.turismodeportugal.pt o http://www.gfk.com o http://www.futurebrand.com/cbi/2014

Portugal as a Brand_Filipe Sá Couto and Guilherme Baptista

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