We’ve stopped what we are doing and creating your personalized BrandZ™ report, which will appear in your inbox soon.

Best Countries - Brand Indonesia

 

Made in Indonesia

 

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

 

Indonesia is seen as a place that’s ready to do business. It offers inexpensive manufacturing, coupled with a rich and diverse heritage, and is an appealing place to visit thanks to its natural scenery.

 

The country ranks #41 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 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 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 Indonesia

 

Indonesia ranks 41st in the world out of 80 countries in the 2018 Best Countries ranking, having slipped two places in the past 12 months. The dip has more to do with movement of other countries up the ranking rather than a declining world view of Indonesia. In fact, Indonesia improved its performance on four of the eight measures that contribute to a country’s Best Countries score. One metric was unchanged, and its score on the other three was slightly lower. The gains came from opinions related to the heritage, culture and quality of life that Indonesia offers, while the greatest decline related to the world view of Indonesia’s sense of citizenship, which covers human rights, freedoms and equality.

 

 

  

 

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.

 

 

 

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.

 

Wish you were here?

 

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 Indonesia is 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 Indonesia between 2015 and 2016 (the latest figures available) was 6.9 percent. Since 2012, visitor numbers have risen 43 percent, and in 2016, more than 11.5 million people arrived in the country, WTO figures show. Indonesia’s central statistics agency, BPS, has announced that in 2017, 14.04 million foreign visitors arrived on the country’s shores; the government had hoped to hit the 15 million mark, but said arrival numbers were affected by airport closures as a result of Mount Agung’s eruption in Bali in November.

 

While tourism campaigns might not have an immediate effect on demand for or appreciation of a country’s brands, there is a gradual impact on perceptions over time, and tourism campaigns can often be the starting point of an international consumer’s relationship with a country and its brands.

 

 

There goes the neighborhood

 

How the other regional powers perform

 

Indonesia performs on a par with its neighbors in Southeast Asia, just below Thailand and Malaysia overall, but ahead of Vietnam and the Philippines. Many of Indonesia’s strengths and weaknesses are shared by the countries around it; all are seen as exotic tourist destinations promising adventure, fun and good food, and both Thailand and Malaysia are associated with religion in many people’s minds, like Indonesia.

 

Indonesia performs significantly better than both Vietnam and the Philippines on two key metrics that relate to business, infrastructure and reliability: entrepreneurship and being open for business. These factors not only affect inward investment to a country, but also rub off on the credibility and trustworthiness of its brands.

 

While consumers based in Southeast Asia tend to have a clear impression of the differences between each market, the same cannot be said for people farther away. Outside the region, the differences between several Asian markets are somewhat blurred; brands that come from Indonesia face a challenge in defining themselves not just as Asian but as distinctly Indonesian.

 

Many countries in Europe face a similar challenge as those in Southeast Asia, in that many of their strengths – and weaknesses – are shared by some of their nearest neighbors. Consider Italy, France and Spain. They are all seen as powerful magnets for tourism, with good food and wine, fashion, cultural heritage and a sense of fun and adventure on offer. But despite these similarities in the way they are perceived, these countries – and the brands that come from each country – have managed to define for themselves an image that is distinct, meaningful and valuable.

 

The same applies to countries like Germany and the UK, which have much in common in the minds of consumers. Both are seen as politically and economically stable, with good infrastructure and a strong sense of entrepreneurship. But they have built subtle yet clearly distinct messaging around what “Made in” either country means.

 

The countries of Asia, and the brands that emanate from them, would do well to mirror the way European markets have focused perceptions of their brands. A broad definition of heritage, for example, could apply to all countries in the region, and to most markets in the world, for that matter. But there are aspects of each country’s heritage and culture that are uniquely theirs, and these can be emphasized to shape a distinct country brand.

 

Indonesia has strong regional differences in culture and a diversity of geography that can be explored and exported by the country and its brands.

 

 

 

Surpassing expectations

Indonesian 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 Indonesia” 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 ring true to people already familiar with Indonesia and its brands – and appeal to those whose exposure has so far been limited.

 

1 Diversity – the country is geographically, ethnically and culturally varied, which is reflected in Indonesia being seen as “different”. Brands can draw on this variety, as does Indomie – one of the best-known Indonesian brands abroad – which regularly promotes new varieties highlighting regional dishes.

 

2 Value for money – Cheap isn’t always seen as a positive attribute when it comes to brands, but Indonesia’s low manufacturing costs enable brands to present a message of fantastic value. Brands can show they offer good quality for a great price.

 

3 Innovation – Fast-growing startup brands such as Go-Jek, Traveloka and Tokopedia have helped build Indonesia’s reputation as a hotspot of innovation, something that reflects well on other tech-focused brands and those in other categories where agility is seen as important.

 

4 Culture and heritage – Music, dance and food all help shape what people abroad already know and feel about Indonesia. Use these strengths in creative ways to emphasize pride in a brand’s history or craftsmanship.

 

5 Natural beauty – Beyond the beaches of Bali, the full breadth of what Indonesia has to offer presents powerful links with the spirituality many people already associate with the country, and reflects well on natural food and drink brands.

 

 

 

Something wonderful

 

Tourism Indonesia is striving to grow visitor numbers to the country to 20 million a year by the end of 2019. But the organization knows it is up against tough competition from other destinations in the region, many of whom have had strong international advertising campaigns over the years: “Malaysia, Truly Asia”, “Incredible India” and “Amazing Thailand” have all been highly effective magnets for tourism.

 

Indonesia’s answer? “Wonderful Indonesia”. What’s special about this campaign is that it’s not just being driven by the Ministry of Tourism; it’s using the power of local brands to promote the strengths of Indonesia and to be its public face. Co-branding the campaign with local brands also makes publicity more cost-efficient. Brands taking part in the campaign include several that appear in the BrandZ Top 50 Most Valuable Brands 2018 ranking.

 

The role of taxi drivers in giving tourists a warm welcome to Indonesia is at the heart of car hire service Blue Bird’s partnership with the campaign. Water brand Aqua and supermarket chain Alfa are also “Wonderful Indonesia” partners, and the bank BRI, which sees its role as supporting the development of the nation, is issuing 25,000 Wonderful Indonesia credit cards.

 

The Tourism Ministry hopes to ultimately partner with 100 local brands that share made-in-Indonesia credentials and offer a premium product or service. The campaign promotes well-known holiday destinations as well as lesser-known locations across the archipelago, focusing on five themes: culture, nature, adventure, sensory stimulation and modernity.