The Challenge of Branding the Baltics

Business Week
Mike Collier
July 15, 2008
It incorporates 11 countries, dazzling cities, major shipping ports, and peaceful island getaways. The only problem is no one really knows about it.

The Latvians are among those who want to change that. The government, backed by eight other nations that border the Baltic Sea, plus two more with cultural connections, have launched an effort to promote “Balticness.” So far this year it featured a photography exhibition and concerts in 11 cities, and more events are scheduled this summer.

That is just part of the drive to create a “brand” for the Baltic Sea region to attract investment and finance, an effort promoted during the Latvian government’s yearlong chairmanship of the Council of Baltic Sea States that ended in June.

But it remains to be seen whether this diverse Baltic region can develop a common brand and parade itself in glossy magazine advertisements or television promotions.

“It’s an ongoing process, though it’s not going to be an easy one,” said Ojars Kalnins, head of the Latvian Institute, the government body charged with promoting the country overseas. “There is no one entity or organization that’s responsible for it. Right now it’s being maintained by a group of enthusiasts — individuals in each country who believe in the idea and want it to go further.”

A former U.S. advertising executive and a leading advocate of branding the Baltics, the dapper Kalnins says the effort doesn’t have universal support from the region’s various intergovernmental organizations and discussion forums.

Organizations like the Council of Baltic Sea States have traditionally focused on commerce, conservation, energy, and cultural exchanges. At their meeting last month in Riga, representatives of the council’s 11 members called for strengthening these ties. Under Latvia’s leadership, the council added a new notion: that Balticness might emerge as a brand image for the entire region.

The search for an identity is nothing new as far as the three small Baltic states are concerned. Following centuries of occupation, it’s understandable that Estonia, Latvia, and Lithuania feel a need to tell the world who, what, and where they are.

But these Baltic states are not the same as the Baltic Sea region, which is one of the main problems facing supporters of branding the region.


British consultant Simon Anholt, a leader in the world of national brands, has been advising the region’s governments on what approaches they might take. He’s come up with suggestions for a Baltic slogan, including “The top of Europe” and “The world’s brightest region,” but these were rejected due a fear of offending others — if the Baltic Sea region is the top of Europe, someone else must be the bottom, and if members say the Baltic Sea region is the brightest, they might be implying that others aren’t as clever.

That’s ironic given that according to Anholt himself, the problem of the Baltic states or the Baltic Sea region conjuring up a common identity is exacerbated by the general ignorance of the overseas audience.

“I’ve been working on the notion of Baltic unity and a Baltic brand for some years,” he said. “It is problematic. As far as the elite audience is concerned, the Baltic brand is quite positive because it is associated with a very interesting, rapidly developing part of the higher-income world. Speak to any reasonably informed internationalist and they’ll be able to trot out figures about the fast-growing economies. In that respect it represents positive brand equity for the individual countries.

“The trouble is that Baltic identity is a minus when you’re talking to general audiences,” Anholt said. “The word Baltic is strongly negative as far as general publics are concerned. It is associated not with fast-growing economies and IT but with a vague image of a miserable, gray, post-Soviet wasteland, probably contaminated, with no culture, no self-respect, and nothing of any interest to anybody.

The push behind the project is that branding is seen as an important means to promote tourism and attract foreign investment, business, and talent. The idea is that a Baltic brand might help the region compete more effectively against other regions that are also trying to brand themselves, including parts of Latin America, Southeast Asia, and Africa.


For the Baltic region, there’s the complexity of trying to brand a politically and culturally unwieldy region that includes five former communist-bloc countries—Estonia, Latvia, Lithuania, Poland, and Russia—together with rich Denmark, Finland, Germany, and Sweden; plus Iceland and Norway, which don’t even border the Baltic.

Not all are members of NATO, the European Union, or the euro zone. Norway and Iceland enjoy special trade relations with the EU; Russia doesn’t. Russia and Sweden are at the polar ends of scorecards on corruption, good governance, and freedom.

Lithuanian Prime Minister Gediminas Kirkilas even suggested at a June meeting in Riga that landlocked, authoritarian Belarus might be brought into the Council of Baltic Sea States. France showed up unexpectedly at the same meeting expressing an interest in membership.

There are also the cultural differences. Estonia considers itself genuinely Nordic, Latvia a little less so, while Lithuania is more interested in a rejuvenation of its historic links with Poland. Further layers of identity are added by whether or not countries are Scandinavian, or ethnically Finno-Ugric, Germanic, or Baltic.

“Nations have brands, but I don’t believe they can be branded,” Anholt said. “The image of a country is quite a large and solid thing. It doesn’t move much at all. To imagine that the beliefs of millions of people in other countries can really be influenced by some sort of marketing campaign is just absurd.”

That doesn’t mean branding efforts are pointless, Anholt added, saying that through their policies they can improve their reputations as places for innovation and investment.


Estonia, the ex-Soviet state, may be one example. “Brand Estonia” was launched in 2001 to take advantage of the country’s hosting of the Eurovision Song Contest but has snowballed into something much bigger. Comprehensive style guides, photo libraries, and consultancy services are made available to businesses to ensure that the marketing of the country is consistent and of high quality.

Enterprise Estonia was set up by the country’s Ministry of Economic Affairs with the aim of promoting competitiveness. “We understood quite early that we are so small with such limited resources that to have some kind of critical mass there must be real cooperation in different areas such as investment, tourism, and exports,” said Erki Peegel, director of marketing and communication at Enterprise Estonia.

Peegel acknowledges that he and his colleagues had to learn several important lessons on the way, particularly how to get politicians of different hues to agree to a joint strategy. “At one time it was so political that there was even a proposal to stop Brand Estonia. It was so high up the political agenda. We learned you can’t do it from the top down with the prime minister saying, This is the thing we will be doing.’ First there must be agreement with important groups such as businesses, the tourism sector, the media. Plus you have to sell it internally. The Estonian people have to believe in this.”

The main thrust of the Brand Estonia effort has been to stress Estonia’s technology credentials. It’s been successful, with the country frequently referred to as “E-stonia” in headlines. Estonian programmers were behind the invention of the Skype Internet telephony service. The country’s successful handling of potentially disastrous cyber-attacks on Estonian servers from computers in Russia served to enhance Estonia’s IT reputation, as did NATO’s decision to develop a cyber-defense center there. Another publicity coup was the decision to open a “virtual embassy” in the online computer game Second Life.

“In the Internet era you must be quick. If everyone knows Estonia as ‘the Skype country’ then it’s very good, so let’s push it,” Peegel said. “At the moment, cyber war and the NATO cyber-defense center of excellence being built in Estonia are interesting for the media. Of course we must push it, as you never know what will be seen as interesting in two years’ time. But you must be as flexible as possible.”

There lies the challenge for the Baltic Sea region — can something encompassing so many countries really be flexible and reactive? Peegel is skeptical about the chances of creating a Baltic Sea regional brand. “Personally I can’t foresee that in the next five years there will be BSR cooperation in branding including Russia and Germany in the brand,” he said.

Anholt agrees. “The best hope for the Baltic countries at the moment is to follow their own paths and forge their own identities,” he said.

Marcus Andersson of Swedish company GeoBrand, which has been working on the brand issue, may have the final word. “I was initially skeptical that creating a brand for the Baltic Sea region could be done,” he said. As an independent academic he performed the necessary research and concluded that it was indeed a vain hope. “Then I became a consultant, so now it is my job to say that in fact it can be done.”

Mike Collier is editor of Baltic Features, a Riga-based news agency.