Countries need to position their local brands right to win the soft power play

Despite being one of the smallest nations, Singapore has taken the title of Global Soft Power Index leader for 2021 in the ASEAN region, and is the only country in this region to make the global top 20 in Brand Finance’s Global Soft Power Index 2021. Across Asia, it ranked fourth behind Japan, China and South Korea. Singapore is also ranked second among all Asian countries for the Reputation score and is only second to Japan. Singapore’s combined reputation score is amongst the highest in ASEAN countries, improving by one rank, while Myanmar saw the most significant rank change by 29 points (in large part because many new countries were added to the rankings). Overall, the ASEAN countries have not seen a significant change in their reputation scores compared to last year. This could be due to a lack of perception of how well the pandemic was handled within the territory.

China’s reputation, according to the report, took a hit in 2020. Governments attempting to rein in China’s influence can expect broad support domestically in many cases. COVID may be a factor, but China’s assertiveness and open conflict with nations such as Australia are likely to be a factor. COVID has significantly impacted the Reputation scores and rankings of a number of countries this year based on how they responded and handled the pandemic (the US in particular).

Vietnam is the another country in the ASEAN region which saw an increase in its ranking this year with a 2.5 increase in its score. This is because of their increase in overall influence and business and trade scores. Globally, Germany has usurped the United States to become the world’s leading soft power superpower, according to Brand Finance’s Global Soft Power Index 2021. With a Global Soft Power Index score of 62.2 out of 100, Germany has a clear 1.6-point lead over second-ranked Japan (60.6), and performs consistently across the Index’s 11 metrics, placing in the top five across nine of these, and ranking highest for statements in the International Relations, Governance, and Business & Trade pillars.

According to Samir Dixit, managing director of brand finance in Asia Pacific, how the country brands itself, as well as brands from the country, both play a critical role in driving the soft power. Many ASEAN countries ranked below the top 20 due to a lack of a structured brand building agenda by most ASEAN nations for their individual countries as well as lack of agenda to build the ASEAN brand on the whole.  

To really climb the ranks ASEAN nations need to build a country brand first and have at least five brands form the country which are globally recognised and are popular.  

“The strength of ASEAN is the deep rooted culture and tourism of course. These should be used as the key driving factors for brand growth, both country and its products,” said Dixit. He added that mostly countries with weaker, or no country brand strategy, end up depending on others to notice them and their strengths on their own. Dixit added, 

It’s just like building a consumer brand. Without a focused strategy and an agenda, the country brand would not be able to contribute to the soft power.

He added that while Singapore leads in most categories, Vietnam is the upcoming and the most promising nation provided they follow a strategy and drive the country brand agenda rigorously. For Thailand, Indonesia and Malaysia, its time for introspection. The countries must understand and analyse what they are not doing right and how can they keep pace and contribute to the ASEAN Soft power. “Ideally, ASEAN countries must drive an ASEAN soft power agenda,” he added.

Currently, ASEAN countries and economies are still in a high to moderate growth mode stages and have reasonably large economies. They have large populations to build their reputation through their people. However, Dixit was of the opinion that most nations tend to look at areas that are only useful for their own country only rather than the bigger picture. “This is a classic problem with growth that once you are caught up with a high pace of it, you tend to lose focus on the big picture,” he said. As such the region has mostly struggled to capitalise on their size, location and population to gain leadership in soft power.

The crucial link for soft power and the global perception is a structured nation brand growth agenda.

“Singapore is the only country that drives their country image as a strategic agenda. Vietnam is also now not so far behind with the prime minister’s office directly leading the national brand agenda,” Dixit said.

“Most ASEAN economies are highly FDI driven due to the opportunities they provide to the external world. But instead of competing as a region, they all compete individually and with each other in most cases,” he added . Moreover, most brand management approach by countries are done for their individual nations and not so much as a regional initiative when it comes to brand and business growth and management – country brand or corporates. That’s also the reason it is extremely hard to find any global brands from ASEAN except a handful such as SIA, PETRONAS. 

When asked what are some areas we can learn from Japan and South Korea, Dixit said, “Have a strategy for the country brand and brands from the country. And showcase. Showcase. Showcase. Promote. Promote. Promote.”

Influence and familiarity

Singapore has a high impression amongst both experts/ influencers and the general public with its steady management, and in 2021 it tops rankings among both segments in the ASEAN region. Malaysia comes in second in its overall impression amongst the experts/influencers ranking second in the ASEAN region, while amongst the general public it ranks third in the region.

Singapore holds a clear lead among ASEAN nations, with 60% of the General Public believing its influence/impact to be ‘mostly positive’, and only 10% regarding it as negative. For many other ASEAN nations, the issue is lack of awareness (of impact) rather than outright negativity – in many parts of the world countries such as Malaysia and Thailand do not have a high profile.

Globally, familiarity for the many of the top 60 nations covered last year has improved this year. This is both due to increased news coverage of all nations around COVID19, more people watching the news due to the pandemic, as well as potentially due to the inclusion of several smaller nations. In relative terms, the larger nations may then seem more familiar to respondents. Thailand seems to have the highest level of familiarity among the ASEAN countries with a score of 5.9. Most of the countries in this region have dropped in ranking except for the Philippines. Though Thailand has a high familiarity among the general public, Singapore ranks the highest among the specialists. Philippines too advanced among Specialists ranking 45th this year. The profile of other ASEAN countries has slipped both amongst the general public and specialists – most notably Malaysia and Myanmar.  

Dixit added that while Covid has posed many challenges for the countries around the world, it also brings along a fair share of praise for countries that have managed the pandemic well thereby giving them an opportunity to showcase their leadership and crisis management abilities.

Well-governed nations climb ranks in the top 20

Europe and Asia command most of this year’s best performing nations, taking a cumulative 75% of the top 20 spots in the Global Soft Power Index 2021. Japan is the top performing Asian nation and second overall (60.6 out of 100), jumping up two spots from last year.

Japan continues to reap the rewards of its strong brands, solid consumer spend, and high levels of business investment, again ranking first in the business and trade pillar. Additionally, Japan has seen an improvement in its education and science score, now ranking first in this metric too.

Countries with a high overall Index score, such as Canada (4th – 57.2) and Switzerland (5th – 56.3), also scored within the top five nations in three key metrics: Reputation, Governance, and their COVID-19 response, suggesting a correlation between being perceived positively in these metrics and ranking highly overall.

On the flip side, ranking 47th in the overall Index, Vietnam (33.8) is a nation that managed COVID-19 extremely well, but this isn't reflected in the data. The combination of poor governance perceptions (68th) and the nation’s failure to develop a strong nation brand results in a lack of credit for its achievements. While initially criticised for its harsh response, Vietnam was spared a year of lockdowns, and besieged hospitals, and has one of the lowest COVID-19 infection and death rates in the world. Vietnam also experienced one of the highest economic growth rates globally in 2020 – one of a handful of countries with positive growth in 2020 - all while neighbouring countries continue to wrestle with deepening recessions.

Dixit said, “Not only is the response to the pandemic from Vietnam is impressive – given its shared border with China – Vietnam has managed to contain the spread and the subsequent waves very effectively with one of the lowest death rates in the world. It is critical that they share their success story and their management abilities with the world to deepen trust and enjoy a more favourable point of view from the global stakeholders. Next 12 months therefore will be Crucial for Vietnam to promote themselves globally.”

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