Balts must learn to brand better

  • 2003-11-20
  • By Aaron Eglitis
RIGA - With EU accession almost a reality, Baltic companies are becoming increasingly concerned with the creation of their own brands in order to take advantage of greater access to the European market.

Product branding, a relatively new concept in the Baltic states, has caught on with great speed in both the public and private spheres.
Despite the growing importance of branding in Latvia, the country currently lacks a unique place to study either advertising or marketing at the university level. The absence of educational opportunities correlates directly to the current dearth of qualified marketers and advertisers.
"There is a general lack of skilled people in marketing and advertising in Latvia," Eriks Stendzenieks, executive director of Zoom!, an advertising firm in Latvia, said.
"There is no place to study advertising," said Lukass Rozitis, creative director of Momentum Latvia. "I think advertising is still in its childhood phase," he added.
Marketers and advertisers interviewed also complained that many companies have little patience for results that sometimes take years to achieve.
What's more, turnover is high in marketing positions.
"The average marketing director stays for nine months and is either fired or leaves by that time for another company," Stendzenieks said.
"Companies want results in three months," he said.
Indeed, the entire concept of branding suffers in the postcommunist economies. Many Latvian businesses do not see it as an integral element for continued growth. Few boards of directors have anyone with a specialty in either marketing or advertising.
"Its important to note that in many of Latvia's businesses there is no marketing department or marketing specialist, said Ilze Krievina of the Latvian Business School.
Despite the fact that a number of countries have improved their name recognition in each Baltic state, such as beer labels Aldaris in Latvia, Saku in Estonia and Utenos in Lithuania, few Baltic brands have been able to create a striking appeal across the region.
"I almost cannot find any Pan-Baltic brands that would be equally strong in all three states, [except] maybe Hansabank," Stendzenieks said.
Rozitis added that locally produced products enjoy greater popularity, thus items identifiably from Latvia will sell better within its borders. "Local patriotism works in selling goods," he said.
"Alcohol beverages are the biggest brands in the Baltic states," he said.
At the same time the Baltics will not be overwhelmed with more savvy European competitors when all three states enter the union next May, according to Stendzenieks. He said that all the brands that wanted to be here had already entered the market.
Still, Baltic companies in general must increase their branding efforts if they wish to expand their business into other EU countries.
"According to the experts, Latvia's businessmen's understanding of branding and its development is not sufficient, because in the perspective of accession to the EU ... this will be a very pressing question," Krievina said.
But some initiatives are being realized. The Estonian government has hired experts to help cast a positive international image of its country, while Latvia uses the Latvian Institute to create a positive national image abroad.
A recent report titled "A Brand For the Nation of Latvia" written by Oxford University business students detailed suggestions and possible symbols that could be used to promote the country internationally. Among students' suggestions was promoting the idea of Latvia as a "keystone" of the Baltics and even using "Baltics" since it was better known than Latvia.
Both Rozitis and Stendzenieks supported the creation of a Latvian national brand.
Rozitis said that doing so was "very important because what the Baltics need is tourism."
"It is extremely important," Stendzenieks agreed.
The country branding projects are thought to bring in increased foreign investment and robust revenue by boosting tourism. For the Baltic states, which have a limited international image - or even negative due to their Soviet past - work on the creation of a brand is considered by many to be essential for their continued development.
Meanwhile, cities have also sought ways to garner attention through the use of branding. The Riga City Council is considering the rooster as a symbol for the medieval city.
To ensure increased growth within the European Union, Baltic business, countries and even cities will have to develop new infrastructure, devote funds and create the long-term strategies necessary for branding.