When Spain won soccer’s World Cup recently, a wave of euphoria swept the nation. Its people basked in the image of creativity, freshness and sportsmanship that the team had conjured. Spain’s image in the global economy had been quite the opposite. The nation was regarded as the new "sick man" of Europe, and this view tended to work against its companies and their products.
But the victory in South Africa gives Spain an opportunity to capitalize on a “halo effect.” The World Cup’s glow could put the nation’s industries in a new light, tying the “brand” of Spain to the emotional attributes associated with its team. Spain’s ceramics sector, for one, is taking note.
“In the absence of any specific information about a product, the image of the country is powerful enough to be able to change the perception of the attributes of the product,” notes a recent study by a marketing team at the Jaume I University. Spain’s image has always been tied to the attributes associated with its team, says Rosa María Rodriguez, a branding expert and member of the study team. “Everything that the soccer team has communicated with its victory is about its way of playing — creativity, freshness, talent, fair play — which are very emotional attributes that could be used to [industries’] advantage, and tied to their ways of doing business in trade and manufacturing,” Rodriguez says.
To date, Rodriguez says, Spain’s image has been tied to such emotional attributes as happiness, a relaxed lifestyle, and anything related to sun and beaches, which “are very touristic elements, since that’s where the promoters have been working the most. These are good attributes. But they should figure out how to adapt them to other areas of production.”
The need to manage the country’s image on a sector-by-sector basis led to the study, “The effect of ‘Made in’ on the perception of a Spanish industrial product in international markets.” Published in Universia Business Review, the study was produced in collaboration with ASCER, the Spanish organization of manufacturers of ceramic pavements and coatings.
A Space Occupied by Italy
The Spanish ceramics sector is the world’s second-largest behind China’s, with a presence on five continents. Its largest customers are France, Russia, the United Kingdom and Greece. Its closest competitor is Italy. In 2008, its domestic sales totaled €1.46 billion, or 22% less than in 2007, and its exports totaled €2.23 billion, or 3% less than in 2007, according to the study.
More than 90% of the sector is located in Castellón province, notes Rodriguez, the province where the university that undertook the research is located. The university has partnered with the employers’ organization in the past. In 2007, well before the real estate bubble and economic crisis hurt the sector, ASCER’s foreign promotion department was asked to identify the attributes that could be used to promote Spanish ceramics abroad. Although Spanish producers’ competitive advantage is traditionally based on cost, in recent years this strategy has become unsustainable because of competition from low-cost producers in China, Brazil and Turkey.
The ceramics producers created a questionnaire and sent it to distributors and end users, such as architects and interior designers, via Ceraspaña, a magazine edited by ASCER and published in Spanish ceramics’ main markets. The producers collected 148 valid responses from users in France and the United Kingdom, which are considered prestigious markets, and Poland, considered a developing market.
The study showed that both Italy and Spain are strongly linked to attributes associated with product, service, guarantees, quality, prestige, investment and R&D. But the attributes associated with industry reputation (prestige) and product aesthetics (design and range of finishes) are more closely associated with Italy.
“Italy has had an advantage for some years,” Rodriguez notes. “During the 1960s, they undertook a plan to work on those attributes. They decided to link ‘Made in Italy’ with design, and they took advantage of that factor in every industry: furnishings, accessories, etc. Italy went out earlier [than Spain] and sold to Europe, so it achieved a ‘pioneer effect’ and won market share, which positioned it better. Spain has to find a niche so that people will identify it in a different way.”
The “Ceramics of Spain” brand isn’t well-positioned, according to the study. Although the industry has invested considerably in promoting it, Spain’s country brand has never worked in a serious way to provide its products with a distinctive personality. “When [Spanish industry] went abroad, it brought along a brand that was devoid of content,” Rodriguez says. “By the time they tried to provide [their national brand] with attributes such as [strong] design, those attributes already belonged to the brand of Italy, so occupying that space was a practically unattainable challenge.”
Product quality is the Spanish ceramics industry’s most representative attribute, but Spanish companies shouldn’t reject other possibilities, the study says. “Italian industry has become associated with prestige, design, and with a wide range of finishes. Those attributes add value and enable [Italian products] to sell at a higher price. The image of Spain is not very far from that, so it should begin to establish a closer positioning; for example, in regard to innovation and services.”
Competition in Other Places
The study stresses the significant progress made by ceramic industries in developing countries. For example, Rodriguez says, China continues to rely on an image that isn’t linked to quality, but it currently caters primarily to its domestic market. The problem for competitors starts when China begins to export a substantial volume of its output.
Brazil, explains Rodriguez, is an emerging industry that is working well. Although it doesn’t currently represent a threat to Spain within Europe, it should be noted that Brazil’s main area of activity is Latin America, where Spain’s ceramic industry has worked at a leisurely pace. “[The Brazilians] are already there, and can count on a very favorable factor, which is proximity. In the Latin American market, where we have been the leaders and we are doing very well, they’ll have to take that into consideration,” she says.
During the economic crisis, while sales in more prestigious markets fell, the markets of Eastern Europe and Africa maintained their sales. It’s hardly surprising that globalization is considered the industry’s last resort. “Demand for the sector is derived from housing and construction, and when the sector was affected [by the recession], one of the first areas to feel the impact was ceramics,” Rodriguez says. The sector sells a lot domestically, where construction and housing have suffered a deep crisis. “So selling their products abroad is something basic and fundamental.”
More than ever, “Institutions have to stress this now because companies are concerned about what happens on a day-to-day basis, how to deal with the crisis and their short-term preoccupations. They should work on resolving some issues so they can make it easier for their companies to market such products as ceramics in foreign markets.”
Engineering an Image
Of course, the image of a country is not easy to engineer. The nation’s institutions have to carry it off without creating fragmentation. Many different institutions and public organizations make decisions on their own, rather than carry out coherent and consistent promotional moves for the sake of a national brand.
Industrial organizations need to act as one. ASCER should promote its efforts so everyone isn’t waging war separately, Rodriguez recommends. “The labor involved is immense. In this sector, it costs a lot because each company believes that they must create their own personality, and they think that it can’t be very beneficial for them to work collectively. They compete with one another, and they are vigilant about what other companies are doing. They are afraid to use the same brand because if one company doesn’t meet the expectations, it can hurt the rest of them, and drag them all down with a bad image.” As a result, Rodriguez recommends creating processes to ensure quality to eliminate any misgivings about cooperative promotional initiatives.
The study also calls for companies to reflect on the role they must play in building a “Made in Spain” strategy. “Organizations should be aware of the importance of carrying out an appropriate incorporation and interaction of these sorts of strategies in their marketing plans,” the study says.
Currently, the Spain brand lacks positioning and personality, Rodriguez says. “Just as with individuals, it is one thing to have a name that identifies you, and quite another thing to have your own personality that distinguishes you from others. That is the shortcoming of the brand of Spain. You have to endow it with a series of attributes and values that enable it to be differentiated in the global landscape,” Rodriguez argues.
Ideally, she says, this should be achieved on a national level, in a way that “the ministries work toward providing content to the brand of Spain, while thinking of a global brand of Spain under which each of these sectors can find common shelter. You would have to make an exhaustive analysis of these attributes while taking into account that on that level you have to accommodate all sorts of different sectors so that there is only one unique image. And later, you’d have to bring these general guidelines to each of the sectors so that each one develops on a sectoral level.”
“This is an area where our research group is working,” Rodriguez concludes. “We understand that it is something that could provide a competitive advantage for the ceramics industry and all of the industries of our country — including furniture, footwear, textiles, which are located in the same geographic region and practically face the same competitors as the ceramics industry — when it is time to go out into the whirlpool of the global marketplace, where it is increasingly difficult to differentiate yourself because all the products are the same.”