Policy network in city marketing
_Comparative case study of Amsterdam and Berlin
Faculty of business and economics
University of Groningen
Paheerya Yushan S1940988
Paheerya@yahoo.cn
Abstract
Table of contents Abstract ... 2 1. Introduction ... 4 2. Literature Review ... 9 2.1 City marketing ... 9 2.3 City branding ... 12
2.2 City marketing policy network ... 17
3. Research design ... 19
3.1 Case selection ... 20
3.2 Research Framework ... 22
3.3 Data and information selection ... 24
4. Case study analysis ... 25
4.1 Amsterdam ... 26
4.1.1 Establishment of the city marketing network ... 26
4.1.2 Public-private platform for control and brand management ... 26
4.1.3 Main organizations in city marketing of Amsterdam ... 27
4.1.4 City marketing policy network (CMPN) ... 31
4.2 Berlin ... 33
4.2.1 Establishment of the city marketing network ... 33
4.2.2 Public-private platform for control and brand management ... 34
4.2.3 Main organizations in city marketing of Berlin ... 34
4.2.4 City Marketing Policy Network of Berlin ... 36
5. Comparison ... 38
5.1 Differences and similarities ... 38
5.2 Comparison ... 40
5.3 Behind the scene ... 43
5.4 What can be learned?... 44
6. Conclusion ... 46
7. Limitation and further research ... 48
8. References ... 50
1. Introduction
“Experience is not what happens with a man, but what the man does with what happens to him”_____Aldous Huxley
With the rapid speed of globalization, development of online communication and development of online marketing activity, cities get into a new competition to attract business, investment, visitors, knowledge and inhabitants. At the same time, more and more scholars, policy makers and companies realize the importance of the city image and reputation in politics, international business and cities long term sustainable development. This makes the city marketing become one of the new emerging topics for academic researchers.
Ashworth and Voogd`s research (1990) is one of the earliest academic researches that examine the application of marketing ideas to urban planning and management. They bring the “city marketing” concept in the urban development academic research field. Kotler`s three books (1994, 1997, 2003) for place marketing made a further contribution on planning place marketing. Rainisto (2003, 2009) and Anholt`s (2007, 2009) research contributed on bringing more in depth planning for city marketing like success factors of place marketing and new concept -“ branding a city as a product”. But on the other hand, city marketing is a complex process that has only recently come on the scene both in practice and academic research, so city marketing is comparatively an unexplored field.
With the growing attention for city marketing in academics, cities see the potential role of marketing, but in practice they are still struggling to find answers for: where city marketing fits in? Can city marketing be managed in the similar way of traditional marketing of products or services? Is city marketing management a political responsibility as a part of urban development? Who is responsible for city marketing? How do they coordinate city marketing activities with different players with different back ground and different interests? (Braun, 2008)
the important topics on discussion is: where does city marketing belong? One prospective is that city marketing can be seen as an expansion of marketing domain. This was pointed out by Kotler and Levy (1969) that some of the activities and strategies of non-profit and public organizations are quite similar to marketing in the business community. Another perspective is to start from disciplines that have traditionally studied cities, regions, places and locations such as urban and regional economics (Ashworth et al, 1990); (Kavaratzis et al, 2005), culture studies, and social geography. In this line of reasoning they argue that marketing has become more important for cities because of global and local processes and international competition which mean cities and regions have developed certain marketing policies as a result of these processes and marketing needs to be adapted to the context and practices of cities.
Braun`s (2008) research is one of the recent in depth research on city marketing which pointed out that one of the persistent problems in academic debate on city marketing is the variety of interpretations and definitions of city marketing.
Based on the definition given by Braun (2008), Lombarts (2010) and definition by American Marketing Association(AMA), it can be concluded that , in academics, city marketing can be seen as “export” from perspective of the marketing disciplines or “import” from the perspective of place-related disciplines(Braun,2008) which involves a complex activities and effort of different organizations. Based on these definitions, in this research the definition of the city marketing is summarized as: an integrated concept of business marketing and social marketing and complex policy process consisting of different, yet connected activities that are focused on keeping and attracting specific target groups (visitors, business, investors and inhabitants) with which several stakeholders with diverse interests are involved.
It can be clearly seen from the definition that one of the challenging characteristics of city marketing is: it’s a joint effort of a group of different organizations and shareholders with different interests. This brings another important issue: can there be a generalized model which can be a guide book for the cities for their city marketing activities?
and institutional background which makes in practice, “city marketing guide book” is hard to generalize and set up.
Case studies by Kavaratzis and Mihalis (2008), Braun (2008), Lombarts (2010) also indicated that city marketing organizations are struggling to find a suitable city marketing approach for them to improve, manage and adjust their marketing activities. In academics, the literature on city marketing is growing steadily but relatively small and there is not enough common ground in terms of its causes, definitions, purpose and conceptual development. So far, in city marketing literature, one common agreement is: coordination of the different organizations and shareholders is a very critical factor for a successful city marketing (Anholt, 2207, 2009; Rainisto, 2003, 2009; Braun, 2008; Lombarts, 2010).
In addition, even there are few different place marketing and planning cycle theories developed by Kotler (1969) and (Ashworth et al, 1990), but other scholars (Braun, 2008; Lombarts, 2010; Heeley, 2011) argue against this opinion. They state that because city marketing policy network is the outcome of political process in which conflicts, cooperation among shareholders and interest groups lead to compromises. So in practice, the management of marketing activities don`t follow such a nice and clear-cut sequential pattern. So any discussion of city marketing management shouldn`t ignore the specific context in which urban policies are developed and implemented. In this research “specific context” means urban governance: how city policies are produced, decided, implemented and who does this (Braun, 2008). From this prospective city marketing is a subject of (political) decision-making and that is has to do with municipal administrative organizations, policy making procedures, partnerships, implementation of the policy and etc. (Kooiman, 2003; Paddison et al, 2000; Braun, 2008)
This leads to the motivation for doing this research: a comparative case study about the structure of city marketing policy network in Amsterdam and Berlin.
infrastructure, regulations, economic situation and geographic locations, Amsterdam and Berlin both have well-structured city marketing network and policy to compete with other European cities. More detailed reason for the case selection will be given in the next section.
Aim of this research is explore the ingredients of contemporary city marketing policy network by in depth case study, explore the process and structure of policy network of two successful city marketing network and try to generalize a model of successful city marketing network. By doing this, this research contributes to the development of the concept of city marketing network empirically and makes contribution for developing a “common language and dictionary of city marketing” for the other cities. Main research question:
What is the current structure of city marketing policy network in Amsterdam and Berlin and what can be learned?
As stated earlier, Amsterdam and Berlin have comparatively successful city marketing policy network, but from the first step observation, they have some differences as well. So aim of this research is to compare the structure of the of city marketing policy network, find the differences and similarities and further more try to give an explanation for the differences and similarities. By doing this, make a contribution to develop a framework for other cities.
To answer the main research question, Sub-questions are formulated as following: To understand the current structure, it is important to know the history of the city marketing network. How the CMN established and developed. So first sub-question is formulated as following:
• How did the city marketing policy network of Amsterdam and Berlin developed?
By answering this question, development process of the city marketing policy network of Amsterdam and Berlin will be analyzed in details.
• What is the current situation and structure of city marketing policy network of Amsterdam and Berlin?
Current situation and structure of the policy network in these two cities will be analyzed by answering the questions: Who is responsible for city marketing? Who is in charge? And how they coordinate?
On the third step, a comparative analysis will try to find the similarities and differences of CMN in these 2 cities. So third sub-question is:
• What are the differences and similarities of the city marketing policy network of Amsterdam and Berlin?
This question is formulated to get a further comparison and understanding of the city marketing network of two cities. By this it’s expected to find success factors of these two cities. Furthermore, try to develop a model which may benefit for other cities.
• How these differences and similarities can be explained and what can be learned?
This sub-question is formulated to answer the second half part of the main research question. By giving possible explanation for the differences and similarities, it’s expected to give more clear answer in what situation, other cities can learned from Amsterdam and Berlin.
1. Literature Review
In this chapter, a literature review combined with quantitative and qualitative researches about city marketing and city branding will be conducted. Finding of the literature will used to develop the framework for case analysis and answering the research sub-questions.
2.1 City marketing
To understand city marketing, it`s necessary to have a look at the main academic researches on this topic. Ashworth and Voogd (1990) are the early scholars who examine the application of marketing ideas to urban planning and management, and their research bring the “city marketing” concept in the academic research field. Kotler`s three books (1994, 1997, 2003) for place marketing made a further contribution on planning place marketing. Rainisto (2003, 2009), Anholt (2007, 2009) contributed on bringing more in depth planning for city marketing like success factors of place marketing and new concept- “ branding a city as a product”.
What is city marketing?
Braun`s research (2008) is one of the recent in-depth research on city marketing. He pointed out that one of the persistent problems in academic debate on city marketing is the variety of interpretations and definitions of city marketing. They argued that most pragmatic approach is to look for a solid base for city marketing in the mainstream of marketing science. So based on this argument, relating city marketing to social marketing concept; identifying and satisfying the needs and wants of the target markets more efficiently than competitors are the main task of city marketing. Braun (2008) defines city marketing as: the coordinated use of tools supported by a shared customer-oriented philosophy, for creating, communicating, delivering, and exchanging urban offerings that have value for city`s consumers and the city`s community at large. And he also defined city marketing management as: the process of setting marketing goals for a city, the planning and execution of activities to meet these goals, and measuring progress toward their achievements.
interests are involved. From the definitions above we can conclude that city marketing can be seen as “export” from perspective of the marketing disciplines or “import” from the perspective of place-related disciplines (Braun, 2008) which involves a complex activities and effort of different organizations.
In this research, definition of city marketing is:
An integrated concept of business marketing and social marketing and complex policy process consisting of different, yet connected activities that are focused on keeping and attracting specific target groups (visitors, business, investors and inhabitants) with which several stakeholders with diverse interests are involved. (Braun, 2008; Lombarts, 2010; American city marketing association)
After defining the concept, it is important to understand: why city marketing is important? To answer this question, the role of the city marketing will be explained in the next step. Role of the city marketing and how it works summarized in the following (Figure_2.1):
(Figure_2.1: city marketing)
It can be seen in this table that as a product, city obtains certain characteristics and functions for its consumers. “Products” being provided by a city is a “basket of products” that the production and consumption happens in the city.
City as a “Product”
Culture and heritage/ Infrastructure/people/ architecture/environment/government regulations/regional brands……….. National and international promotion events and activities, Social media, online marketing, Other Events and Campaigns ……… Improved image/higher attractiveness of the city Bring more “Consumers” to the “city”: Tourist, International companies/investors; Inhabitants; International Students; Artists; knowledge…… Other benefits:
Positive influence on local brands and international companies that connected to the city`s reputation. Improved image of the city, nation and country……
Marketing activities of City
marketing organizations and companies Leader organization Policy maker Task division Funding Decision making
Coordination and cooperation Public- private partnerships
City marketing performance:
The upper part of this (Figure2.1) shows that city marketing organizations` responsibility is promote the “city product” and improve the image and reputation of this “product”. With their effort, city will attract more “consumers”. Based on Braun (2008) and Kotler et al (2002), main consumers of the city are:
Inhabitants: customers in this category are looking for a place to live which includes the infrastructure, education, environment, employment, leisure faculties and others. Companies: companies are one of the important customer targets of the city who look for a place to “do business” and an environment to pursue their objectives. Which requires: site, buildings and its direct environment; employees; customers and new customers; suppliers, finance and partners.
Visitors: visitors are the customer group who looks for temporary accommodation, culture facilities, entertainment facilities, shopping facilities and others.
Investors: investors are the consumers who strive for a good return on their investment but do not select a physical environment in which to operate.
In addition, intermediaries, students and export markets are also the “Target consumers” of a city. Different consumer group with different interests require the cities to provide a “basket of services and product”. This strong demand requires the strong coordination and joint effort of different organizations (public and private stakeholders with different interests).
Furthermore, with successful marketing, improved image and reputation will bring more benefit for the “owner” of the city and the country: development of the economy, increasing job opportunities. And in the long-term an improve reputation of the citizen, companies, and products from this city and country. This special characteristics requires the organizations and the “owner” of the city to work together to provide a better “product” for their customers.
coordination in their marketing activities (Braun, 2008; Kotler et al., 1994, 1997, 2003).
2.3 City branding
City branding becomes a popular method for city marketing in the recent 10 years. In this section, definition of city brand, important role of city branding and challenges of city branding will be illustrated based on the previous research literature.
Moilanen and Rainisto (2009), Braun (2008) and Anholt (2007, 2009) all emphasized that place branding is one of the efficient way for city marketing. “I NY”, “I amsterdam”, “Be Berlin” and other city brands are launched by different cities in the last ten years. Hankinson (2001) also stated in his research that one of the popular and effective tools used by the cities for city marketing is city branding. Before understand how the cities do city branding, it’s necessary to understand what city branding? Why city branding is different? What are the obstacles for city branding? What is city brand?
Generally, in academics, destination branding, city branding and nation branding are all together called “place branding”.
Place brand: the practice of applying brand strategy and other marketing techniques and disciplines to the economics, political and cultural development of cities, regions and countries. (Palgrave-journals.com). from this definition it can be concluded that City branding is a “method” of city marketing that applies brand strategy and other marketing techniques to contribute on the economic, political and cultural development of the city.
Why city branding?
and marketing activities also influence the competitive identity of a place. The role of the city branding can be concluded as external and internal:
External: A good city brand development and management will bring more tourists, inhabitant, more business and knowledge in to the city. In addition, in the long-term a good city brand will influence the reputation of the products, people and knowledge from that city.
Internal: A good brand development of the city will make it more clearly for the city marketing organizations what message should sent out to the consumers of the city and what message should city brand carries with it. City brand carries the combination of different characteristics and functions of the city, so it requires the city marketing organizations to work together with the companies, towns and surroundings to gain one common goal. Even though, city branding is a more complex process and requires a join work of different organizations to maintain and further develop the brand, the way how place branding attempts to influence peoples` perceptions and images about the city is similar to the way that businesses have been successfully attempting the same for their products.
Why city branding is different?
The complexity in city branding mainly comes from the influence of independent actors on the process. As Krouwels (1994) stated city branding is in essence “the market focused coordination of actors by governmental organization in order to create a consistent image to the outside world”.
Moilanen and Rainisto (2009) summarized the 12 Challenges in building a place brand:
(Figure-3.2.2: 12 Challenges in building a place brand)
Product related issues City branding Network related issues
New concepts, new range of usage
Changing seasons and a brand
Tourism products’ experience centricity Product development
Product factor`s inequality The consumer builds the product
Collective character of place marketing Difficulties in controlling
Limited possibilities to opt out, “Forced network”
Defining a brand`s object in a network Closes to politics
It can be seen from this table that except the product own characteristics, other half of the challenges comes from “City branding network related issues”.
Collective character of place marketing: In place marketing the branded destination is a multinational and complex entity. A large group of actors is participating in the production and typically they are all very different from each other, due to their objectives, resources and capabilities. So a place product is actually a serious of products, services, combined with the physical features of the place (Ritchie, 1998; Ashworth et al, 1990).
Difficulties in controlling: A notable difference between place marketing and consumer goods` marketing or service marketing is the low-level of control (Pritchard &Morgan, 1998; Morgan. 2003; Morgan, 2006).
Limited financial resources: Instead of one actor, a successful place brand value for a group of actors. Defining who will benefits from it and dividing investment fairly between the beneficiaries is challenging. Typically, actors from the public sector also participate in financing the brand. But as public organizations are not profit oriented organizations, so public sector has more limited resources to invest in city marketing (Moilanen et al, 2009).
In the book of Heeley (2011), he pointed out 5 constraints for city branding:
• Lack of influence and control over the socio-cultural forces which ultimately shape that which city branding is ultimately seeking to transform.
• In reality, a city brand may attempts to be an “umbrella”, but the local organizations-marketing agencies, municipal authorities, business community and local residents-resist” taking shelter” under it.
• There is great confusion about city branding amongst politicians, stakeholders, residents and business and media. So to develop to a situation in which these different interest actors understand a city brand, let along, support it, requires power of advocacy and persuasion which often beyond the capacity of any single organization.
• City branding involves significant origination and implementation costs which the local public and private sectors usually are reluctant to pay.
• City branding projects are difficult to measure and evaluate.
So based on the arguments of (Moilanen et al, 2009) and (Heeley, 2011) and others (Anholt, 2007; Hankinson, 2001; Kavaratzis, 2007), developing and managing city brand is complicated and hard to analysis due to following reasons:
• Nation/city brand image is something hard to make it measurable, traceable. • There are existing obstacles for place branding due to the country of origin,
history, culture which are hard to change or may takes a very long time to improve. • Place branding requires a high level cooperation and coordination of different
public and private organization within the network which makes the place branding much more complex than traditional product branding.
be reduced or overcome? To find an answer for this question, firstly, it is important to understand what are the different “shareholders” and interest group in city marketing. Who are the important stakeholders in city branding?
Simon Anholt is one of the famous experts in place branding and he contributed a lot to place branding with his researches in the last ten years. Anholt generalized different hexagon for nation branding and city branding in his previous researches.
The Hexagon below is summarized from Anholt`s (2009) six dimensions. Six components of the place brands hexagon and the consumer groups are illustrated in the following graph:
(Figure_2.3.1: Important factors in city branding)
This hexagon structure shows the different aspects and the complex structure of relationships between the aspects, objectives and stakeholders in process. The attributes of this model can be linked to the different groups of stakeholders in the process. Stakeholders that we can derive from this model are the city`s population (people), the local government (regional policy, culture and heritage), the destination marketing organization (tourism), companies (regional brands, investment and heritage) and universities (investment and immigration). These different groups of stakeholders need to work together to build an effective city branding strategy (Anholt, 2007).
City branding will be effective and successful if actors in the city branding process are able to work together in a long term relation (Ward, 1998; Kavaratyzis, 2004). In Moilanen and Rainisto`s research (2009), they summarized success factors for city
Regional policy Investment and Immigration Culture and Heritage Regional Brands The tourism Consumer target: Visitors Inhabitants Consumer Target: Business and investors People
Consumer target groups: Investors and inhabitants
marketing. Based on their research, there are 5 fundamental structure elements in city marketing: planning group, vision and strategic analysis, place identity, place image and leadership. Braun (2008) emphasized that city marketing is a marketing activity that influenced and managed by the governmental public organizations. So in practice the “leader organization” or “planning group” are usually the government organizations. But as different cities have different institutional and government settings, so the policy making organization, or the way city marketing policy developed and managed is different from place to place. In addition, city marketing is a joint effort of different organizations that have different interests. So even government plays a leadership role, city marketing requires a high degree of independency in decision making, planning and daily performance. In order to reach this goal, one solution is that governmental organization needs to form an informal network and needs to work on the steps of the process in cooperation and in negotiation with the actors in the network. This brings the next step: understanding the policy network in city branding.
2.2 City marketing policy network
the issue that needs to be solved. So in city marketing, the problem is how to set up a good image of the city to attract visitors, investors, business, inhabitants, knowledge and so on. The player is the organizations and companies that are influential in forming a plan to address the problem in question. In city marketing, the players are the public and private organizations that play main roles in establishing the whole image of a city and promote this image to the outside world. Policy is the finalized course of action decided upon by the government or partly decided by the government. In most cases, policies are widely open to interpretation by non-governmental public players, including those in the private sectors.
Another possible theory for analyzing city marketing network is cluster theory which introduced by Porter (1990) which regarded as a way to obtain external economies of scale and to help firms to develop products, services, and production and distribution systems that engender competitive advantage (Porter 1990, 1998, 2000). In this research, policy network theory is considered to be more suitable for analyzing city marketing network. Because city marketing is part of urban governance which is part of the political process that involving multiple stakeholders with different objectives (Braun, 2008) while cluster theory is more focused the importance of geographic concentrations of firms for organizational learning, innovation, economic and industrial development (Asheim, 1996; Lundvall, 1992; krugman, 1995).
Next step is how to analyze the policy network. The Rhodes model of policy network has been employed more often by other researchers (Peterson, 1995a; Daugbjerg, 1999; Peterson et al, 1999; Falkner, 1999, 2000). In his model there are three key variables determine what type of policy network exists in a specific sector:
• The relative stability of network`s membership • The network`s relative insularity
• the strength of resource dependencies
• As a method to describe links and interactions between actors involved in the policy process.
• As a method to analyze social structure, i.e. the way in which network structures affect behavior of actors and their interactions within that network, so influencing policy outcomes.
• As an analytical tool to study/analyze the relationships between actors interacting on a given issue.
In this research, the frame work for analyzing the policy network is formulated based on “the success factors in place marketing” by Moilanen et al (2009), and the suggested way of Thatcher (1998) and Borzel (1998): use the policy network as a tool to study/analyze the relationships between the actors in Amsterdam and Berlin city marketing network and try to analyze them by answering the questions which includes the aspects of policy network in The Rhodes model (1990, 1997):
Figure-2.2: Framework for analyzing the city marketing policy network structure
(Sources: Rhodes, 1990, 1997; Thatcher, 1998; Borzel, 1998; Moilanen et al, 2009)
This framework will be used to analysis the current situation and structure of the city marketing policy network. These questions in the framework will used to answer the second and third research sub-questions in details.
2. Research design
In the first section of this chapter, the reasons for selecting these two cities will be given. Then the research framework will be illustrated based on the literature review
Structure of the network
City marketing Policy Is there a clear city marketing policy? Who makes CMP?
Umbrella organization Is there a leader organization? Who do the planning?
main actors in the network Is there natural work division by CM organizations based on different consumer target?
division of the tasks(based on different target groups)
How the consumer targets are divided between different organizations?
financial recourses and financial independency
Do network members depend heavily on each other for valued resources such as money, expertise and legitimacy or are most actors
and research–sub questions. At the end, the methodology for data and information selection will be presented.
3.1 Case selection
In this research I would like to investigate the city branding network by in depth comparative case study. As most of the research on city branding focused on the theory development in city branding, this research will contribute to fill the gap in the city branding research by doing a close case investigation on how the city marketing policy network (CMPN) is established, structured and organized to meet the common goal while keep the individual`s organizations independency. As different cities have different institutional and government settings, so the policy making organization, or the way city marketing policy developed and managed are different from place to place. To understand how city marketing network structured and managed, it is necessary to understand city marketing policy network in a specific context. Kavaratzis (2004) stated that there is a shortage of qualitative, case study insight, into the city branding process. Case study approach is considered to be highly suitable, comprehensive research strategy to understand and develop in-depth understandings of complex social phenomenon and unfolding process within contextual situations (Brotherton, 1999; Thomas, 2004). So to get a more clear picture of city Marketing policy network, this research will based on in-depth interviews with the stakeholders in the city branding network of 2 cities: Amsterdam and Berlin. Figure_3.1.1 shows the summary of the facts and figures about the competitive positions of Amsterdam and Berlin in different ranking in the past few years.
(Figure-3.1.1: competitive position of Amsterdam and Berlin)
It can be seen from this figure that Amsterdam and Berlin has been holding a very competitive position in the international ranking of the cities. Furthermore
Resources ranking ranking
Results of the first city brands index ( Anholt, 2007) 6 10
Cushman&wakefield: European cities monitor (2010)(2009) 7/8 6/9
Cushman&wakefield: Best city to locate a business today (2010) (2009) (2008)(2007)(2006)
6/8/6/5/6 7/9/8/8/8
Amsterdam established a formal city marketing organization in 2003 and launched “I amsterdam” city brand in 2004 while Berlin established a formal city marketing organization in 2002 and launched the “Be Berlin” city brand in 2008.
It can be seen in (Figure_3.1.2) that Berlin spends much more in city marketing than Amsterdam. But the percentage of the government investment and non-government investment in city marketing is similar.
(Figure_3.1.2: Overall investment in city marketing in Amsterdam and Berlin)
Million(euro) Million(euro)
Government investment 4.6 16.2
non-government investment 4.85 17.75
(Source: Amsterdam city marketing report- 2004)
In addition, following reasons also support the decision of selecting Amsterdam and Berlin for this case study:
(1) In city classification of European cities (Ashworth, 1989), these 2 cities belong to the same categories: “Top league”. In city classification of Global power city ranking, they both belong to group B-Cities predominant in Livability and Environment. In addition, they are both capital city.
(2) Based on the tourism attraction rating of ECM/Tour Mis from last five years, Amsterdam and Berlin always stay in a competitive position on the rating. In Anholt`s first city brand index (2007), these 2 cities also at the competitive position in city brand rating.
(3) Amsterdam and Berlin both launched city brand (Amsterdam in 2004, Berlin in 2008) and mentioned by several researcher`s (Anholt, 2007; Kavaratzis, 2005; Braun, 2008; Heeley, 2011) as successful city brands. But based on the first step information gathering Amsterdam has more clear developed policy and city marketing plan while Berlin do the city marketing in a different setting.
(5) In business attractiveness ranking, based on the “world`s top 300 companies” (2008), Amsterdam has global (non-financial and financial) corporations between 1-19 while Berlin has 1-9. Amsterdam has 3 TOP 300 global companies` HQ while Berlin don`t have companies belong to this group.
In conclusion, all these facts and figures show that Amsterdam and Berlin are in a competitive position in the city ranking and belong to the same group in city classification. They are capital city and they start their city branding activities at a similar period. Except the similarities and competitive position, they have some differences in the investment in city marketing as well as the strength and weakness of the city in attracting tourist and business. These similarities and differences supports the idea that selecting Amsterdam and Berlin as case study objects for this research.
3.2 Research Framework
As it is stated in the first chapter, main research question will be answered by 4 sub questions. In this section, the illustration of the research steps will be given.
• How did the city marketing policy network of Amsterdam and Berlin developed?
This question formulated to get an in depth overview of the city marketing policy network development in these two cities. To answer this question, materials and reports from the city marketing organizations will be used. In addition, background related questions will be in the questionnaire.
• What is the current situation and structure of city marketing policy network of Amsterdam and Berlin?
Based on the first step information gathering, current picture of the city marketing policy network in Amsterdam and Berlin will be summarized and further analyzed. To answer these questions, the framework summarized in the last chapter (table 2.2) will be used to define the different players and organizations, role of this organizations, tasks division and responsibility of different players, financial resources and financial independency of these organizations will be analyzed in details in chapter 4.
By answering this question, differences and similarities of these 2 cities will be analyzed. Making a comparison analysis is an important step to find the advantages and disadvantages of the CMN in both cities. In addition, this step is an important step to find out what other cities can learn from Amsterdam and Berlin. So after getting an overall overview of the city marketing policy network of 2 cities, a comparative analysis will be given to get a comparative picture of the city marketing policy network. Framework for the comparative analysis is summarized in (Table.3.2): (Table_3.2: Framework for comparative analysis of city marketing network)
Differences and similarities of the CMPN, further comparison will be given based on this framework in chapter 5. These analyses will answer the third research sub-question.
• How these differences and similarities can be explained and what can be learned?
Answer for this question will be given in Chapter 5. By answering this question, it’s expected to find out possible explanation for the similarities and differences. As stated early analyzing city marketing policy network should include the context of the specific case. So by finding possible explanation, a further fundamental basement will be given for the other city that what kind of strategy and CMPN should be implemented in what kind of circumstance and situation. At the end, by doing further comparison and analysis for possible explanation for the differences, it’s expected to generalize some common factors for a successful city branding policy network establishment and management.
Structure of the network Umbrella organization, main actors in the network, role of the
municipality
The relative stability of network`s membership
Do the same actors tend to dominate decision-making over time or is membership fluid and dependent on the specific policy issue under discussion?
the strength of resource dependencies
3.3 Data and information selection
Data and information for the research will be gathered through following ways:
• Theories on city marketing, city branding, network policies theories will gather from existing literature to build a strong theoretical background: on definitions of terms; relations between city marketing management and policy network.
• For the Policy network analysis of Amsterdam City brand, analyzing the structure of the existing network and relations, coordination level of the network actors, the steps in (Table 2.2) will be used to understand the background of the policy network, main actors, responsibilities, funding and activities.
Multiple data collection method will be used to increase the range of material. Except the theoretical literature gathering, in-depth semi-structured interviews and conversational interviews (formal/informal) will be taken. Questionnaire for the interview can be found in (Appendix1). Semi-structured schedule is chosen because it gives the interviewer considerable discretion over the conduct of the interview. But the limitation of semi-structured interview is categorization and comparison of responses is more difficult and the recording of responses is also more problematic. In addition, the potential for meaningful communication is also strong. As Thomas (2004) stated the semi-structured interview is suited to exploratory studies where the issues of interest are ill-defined, sensitive or highly personal and where the sample is heterogeneous.
Conversational interviews are likely to be appropriate in field settings where the researcher is presenting long enough to develop informal relationships with participants. Limitation of conversational interviews is recording may be more problematic than with the more formalized structured and semi-structured interview and considerable flexibility is required of the investigator in the absence of a preconceived plan (Thomas, 2004). In addition meeting-information documents, annual report, organizations website, documentaries are the resources to get sufficient information for analyzing the network.
information (Back ground, actors, responsibilities, financial recourses, funding, and formality of relationships, events and activities).
Berlin: basic information about the main actors (Berlin Partner GmbH, Berlin Partners Holding: Capital City Marketing Ltd; Berlin Tourismus&Kongress GmbH; Berlin Senate; Partner hotels Preferred Agencies; TMB Tourismus-Marketing Brandenburg) will be gathered through organizations websites and other reports. Then Semis-structured interviews with the managers of the main organizations will arranged to get further information.
Semi-structured interview format will used to guide the interview process and to ensure that information regarding the roles, activities and integrations of the stakeholder groups and their knowledge of network policy, planning and destination management issues will be explored. Open ended questions will used to gain spontaneous opinions and avoid potential researcher bias. To ensure the saturation of the processes, a snowball technique will used and interview participants will asked to identify other information within the network and interviews will conduced until no new information revealed.
3. Case study analysis
In this chapter, first, the background and history of the city marketing policy network in Amsterdam and Berlin will introduced. Then the current situation and structure of the city marketing policy network will be analysis in details.
Amsterdam, one of the most popular tourist destination in Europe and most preferred city for the investors in Europe. Based on the official statistics, Amsterdam is one of the most popular tourist destinations in Europe, receiving more than 9 million bed nights in 2009 and more than 80% of the visitors are international visitors (ECM/TourMis, 2009).
4.1 Amsterdam
4.1.1 Establishment of the city marketing network
With the growth competition in city marketing between European cities, City of Amsterdam realized the importance of city marketing to improve city`s image to have a competitive position. So this leads to the new approach for city marketing. Starts from 2002, city of Amsterdam and some city marketing organizations took an intensive research on “what needs to be changed in city marketing of Amsterdam?” After 2 years research, interviews with the main organizations and brand development planning and preparation, in 2004 Amsterdam Set up the city brand “I Amsterdam”. After an in depth investigation and SWOT analysis of the city image (16 dimensions of city image evaluation can be found in Appendix 2) , diversity of the city marketing organizations and promotional organizations, city of Amsterdam formulated the city vision, city brand development plan, city marketing policy implementation and evaluation plan.
City of Amsterdam acts as a cooperative partner and established a public-private platform for the public city marketing organizations and private companies. In this way city, public organizations and private organization will work together to meet the target of city marketing plan. City of Amsterdam spends around 6.5 million each year for city marketing activities (includes the direct subsidy to the individual organizations and coordinated city marketing projects).
“4 years” defined as a city marketing cycle. So every 4 year, organizations who want to involve in city marketing activities can submit their proposal (strategic plan). After the evaluation of Partners of Amsterdam, city marketing and promotion organizations will get subsidies for their organizations based on their proposal. At the same time municipal executive makes city marketing policy based on prioritizing the sixteen dimensions (Appendix 2).
4.1.2 Public-private platform for control and brand management
guided”. After the development of the city brand, there had been some acquisitions, re-structure of the organizations, at the end main organizations for city marketing reduced to a smaller number and some organizations have acquisitions and reconstruction for better city marketing.
Finance of these organizations comes from two sides. One is the government funding (subsidies) which is decided every 4 year based on the proposal of the city marketing organizations and city marketing plan. Another part comes from the funding from private companies (international companies, and local partners). Private companies involve in city marketing in different ways: direct funding (sponsorship) or membership. To coordinate the online activity, start from 2004, “I amsterdam” online portal become the one and only official website of Amsterdam. Organizations in the CMN responsible for the update, development and maintaining of different sections. In 2011 a new city marketing officer (CMO) nominated by the city to coordinate and organize the city marketing activities of different organizations in CMN. CMO will be responsible for the decision making and marketing strategy development of ATCB, Amsterdam in business and AUB (all in one). In addition, starts from 2011, there will be one budget called “city marketing budget” each year which will be given to the city marketing organizations all together. How the organizations going to divide this subsidy is still on discussion.
4.1.3 Main organizations in city marketing of Amsterdam
Amsterdam Partners
Board of directors: more than 30 board members from different organizations (city of Amsterdam, business partners, educational organizations and institutions) seat at the directors board.
Administrative board: administrative board members are from Schiphol Group, City of Amsterdam, City of Almere, Wolters Kluwer, and Amsterdam Chamber of commerce.
Main financial resources: around 50% (government funding), around 45% (business community funding) and around 5% comes from the operational revenues. Organizational structure of AP can be found in (Appendix 3) and (Appendix 4). Business community: The business community is involved through seven large (multi)national corporations located in the Amsterdam area. Except from these seven contributor companies, a large number of companies in the service industry, the legal profession, real estate, hotels, convention centers and publishing also coordinate with Amsterdam Partners. They all make contribution in terms of content, check and advise AP and provide additional annual financial contribution and a one-time donation as a stimulus for positioning “I Amsterdam” city brand. The largest enterprises in the Amsterdam area will be represented on the Board of Directors or on the Advisory Board. In addition there is a group of sponsors. The reason of this setting is to involve the marketing directors of the large multinational companies as advisors.
to carry the advantages, unique characteristics of Amsterdam or specific Amsterdam products, services, qualities and characteristics to the whole world.
The City of Amsterdam: City of Amsterdam is not a Covenant Partner, as the city is part of daily management of Amsterdam Partners. City of Amsterdam has its own bilateral subsidy relationships with these organizations (covenant partners), which allows them to manage the interactions. So three-way relationships exist between the city, Amsterdam Partners and the individual (covenant partners) organizations, which allows the management of city marketing via focus meetings and work agreements and have a stimulating effect on the subsidy relationships.
Amsterdam area: The Amsterdam area (Amsterdam region) is also represented in Amsterdam Partners, with the mayor of Almere as member of the Board. With the beginning of “I amsterdam” brand promotion, the region is also promoted as a part of “Amsterdam metropolitan area”.
Amsterdam Tourism &Convention Board (ATCB)
ATCB is a public-private organization and the main actor in branding Amsterdam in tourism and convention section. They closely collaborates with the local corporate, cultural and government communities to achieve a common goal: attracting the maximum number of annual visitors to create a strong economical foundation in the Amsterdam region (www.iamsterdam.com). To achieve this goal following marketing activities are applied by the organization: promotion, product innovation (marketing products like theme year, city brand events, and online marketing campaigns), research and press trips.
At city branding policy network level, ATCB is very active in cooperation and coordination with other public, private and public private partners. Together with other organizations such as the City of Amsterdam, Amsterdam Partners, Amsterdam Cruise Port and the Amsterdam Uitburo, ATCB constitutes the heart of the city marketing for the Amsterdam Metropolitan Area. The structure of the organization can be found in (Appendix 5). Main financial resources of the company: VVV office income (around 50%), membership funding (around 35%), government funding (around 15%).
Amsterdam in business is another main player (non-profit public organization) in the top level city branding network which focuses on attracts business to Amsterdam. AIB is 100% public organizations. By the cooperation and coordination activities with the companies in different section and industry(financial services, tax organization, real estate, governmental organization related to setting up business, Chamber of Commerce, universities and other education institutes for foreigners…), Amsterdam in business provide most updated information and services for the business organizations (iamsterdam.com). Main services they provide includes: relocation advice; intelligence; subsidies; taping into labor market; support for legislation, tax and regulations; organizing network event; building channel with the Dutch government and others.
AUB (Amsterdam Uitburo/ AUB)
The mission of the Amsterdam Uitburo (AUB) is to increase the cultural participation of inhabitants and visitors by promoting the cultural initiatives and programs in Amsterdam city and metropolitan area. Consumer target groups of AUB are national inhabitants and visitors of Amsterdam who come to this city for festivals and cultural events. AUB coordinate strongly with ATCB and Amsterdam Partners to reach their goal. AUB is also one of the main organizations who directly participate making the city marketing plan.
Other organizations in city marketing of Amsterdam and metropolitan area
Economic development board
The Economic Development Board facilitates cooperation between industry, academia and government. Top entrepreneurs, administrators and representatives of research institutions are united in the Economic Development Board of Amsterdam metropolitan area. The mayor of Amsterdam is the chairman of the board. Economic Development Board is established to strength the economy; maintain Amsterdam position in first top 5 strong European business regions.
Expatcenter
created a Partnership Program in 2009 to connect expats with service-providers operating in the expat market. The program offers assistance to expats by connecting them with relevant service providers. Over 300 companies now use the services of the Expat Center. Once become a member of the Partnership Program, companies will benefit from the exposure and advertising opportunities which are a part of the basic membership package.
Netherland Board of Tourism and Convention (NBTC)
Based on the information on NBTC`s official website, NBTC operates an international network of 11 of its own offices and three representative offices. They are sited based on the number of visitors from a country or region and on market potential. Within country or region, NBTC focus on visitors (including business travelers) who increase value for 'Netherlands PLC'. NBTC is an expert partner for the “I amsterdam” brand network in various ways: they have the knowledge of actual and potential visitors, markets and marketing and communication. Their research department continuously monitors trends and developments, identifies visitor profiles and measures the effectiveness of campaigns.
4.1.4 City marketing policy network (CMPN)
Structure of CMPN in Amsterdam
City marketing policy network of Amsterdam summarized in the Figure-4.2.1).
(4.2.1 City marketing network structure of Amsterdam) City marketing network: Amsterdam
Tourism Business and Investors
ATCB AUB Amsterdam in business
Amsterdam
Partner Economic Affaires
I Amsterdam sub-branding organizations
City of Amsterdam
I amsterdam (City Brand)
Amsterdam airport area AUB ATCB Amsterdam Centre for Arcitecture
Top sport Amsterdam Kennis kring Amports Amsterdam Cruiseport
Inhabitants Influential third parties
Economic development board
Netherlands` Foreign Investment Agency
Dutch taxation /Association of Tax Advisors
Chamber of Commerce Education institutions in Amsterdam VVV
Leisure marketing & Research and development
From this network structure it can be seen that there is one policy making organization and one umbrella organization that is responsible for the brand policy development, supervising the sub-branding organizations. There are 4 other main organizations are focusing on the different consumer groups and they rely on the City of Amsterdam to a different extend. This relationship can be seen in organizational plan making and city marketing strategy development. In addition, they all get subsidy from the government, which also increase the mutual reliance between the city and the other organizations. So in Amsterdam, City has the city marketing policy and organizes the join work of other organizations. City of Amsterdam requires the city marketing organizations work together to make 4 years city marketing plan. Based on this plan, they will also make their yearly plan as well as join projects plan. At the same time each organization has strong independency in its daily organization activity and planning. Except the coordination between these organizations, NBTC and regional organizations (Nord Holland) also actively involved in the city marketing activities of Amsterdam area.
Shape of the CMPN in Amsterdam
Shape of the CMPN in Amsterdam summarized in the following figure (4.2.2):
(Figure .4.2.2__ Amsterdam city marketing policy network)
In conclusion, City of Amsterdam operates as a policy maker and organizer of city marketing plan of Amsterdam. Government plays very important role as planner and supervisor. At the same time city applies “let the individual organization do the actual work” principle. Amsterdam Partners works as a platform for the government,
NBTC ATCB City of Amsterdam AUB Amsterdam in business Amsterdam region
Netherland`s Foreign Investment Agency Dutch taxation /Association of Tax Advisors
Chamber of Commerce
Education insitutions in Amsterdam
Leisure
marketing&Research and development
Amsterdam partner
Advisory board
Business community Local government services
Sponsors
Other international city marketing network
VVV
ACB
Economic development board
industry, the area and organizations with marketing and promotional objectives. Other organizations develop their organizational plan based on the city marketing plan (4 year plan) and still have a higher level of independency in decision making and daily management. In the long term, government will still play the main policy making role, but involve more business partners in city marketing is one of the target. Based on the interview with the city marketing organizations, new trend in Amsterdam city marketing is: more business partners involvement, less complicated structure; in the long term make one big organization for city marketing (which means there will be more merger and acquisition of city marketing organization); principle of the city marketing is: do the city marketing more in real marketing way and spend the money in a responsible way.
4.2 Berlin
4.2.1 Establishment of the city marketing network
Berlin starts to have formal, well-organized, all in one city marketing activities since 2005. Berlin Partner GmbH (a unified organization of former BAO Berlin- Marketing Service GmbH, Berlin Business Development Corporation and Berlin Partners Capital City Marketing) formally established in 2005 as a city marketing organization. Except the promotional activities, BP also provides investment consultancy for the companies who is “coming to” Berlin and who is “going outside” from Berlin.
Be Berlin city marketing campaign was launched in 2008 by the Berlin Senate (City of Berlin, Berlin Land). The campaign is financed by the senate and partners from Berlin business community. The goal of the campaign is to strengthen Berlin’s positive image and to promote the city on a national and international level as a great place to live, as a leading location for business and industry, and also as a travel destination for the tourists (national and international). Berlin have three official online portal for the promotion activities of the city: Beberlin.de (city portal: official Web site of the state of Berlin); visit berlin.de (official website of Berlin Tourism&Kongress GmbH); berlin.de (official website of Berlin Partners).
universities and other educational organizations participate in a broad network of partners. In addition, responsibility of Berlin Tourism&Kongress GmbH is promoting Berlin as a tourist and congress destination.
Besides these two large organizations, the administration itself, both at federal, state and municipality level pursue their own city marketing policy; have their own contacts and political agendas. Cultural foundations, for example the Goethe-Institute or organizations such as the Berlin Trade Fair Centre, all do their own place marketing.
4.2.2 Public-private platform for control and brand management
Berlin city marketing policy network is loosely structured which there is no one city marketing policy by the municipality. There is less government involvement but more commercial organizations and institutions involvement. Investment bank of Berlin (a subsidy of the city of Berlin) and business partners directly involve in decision making of the organizations by holding the large part of the shares of Berlin Partners and Berlin tourism Marketing, but they don`t involve in planning and daily management. City marketing organizations are comparatively more independent from the city in financial resources as well as organizational planning. All the city marketing organizations have their well-established public-private platform with the private companies in tourism section and business section. Further analysis of the PPP in Berlin city marketing will be given the next section.
4.2.3 Main organizations in city marketing of Berlin
Berlin Partners GmbH (BP)
government”. In the following table (4.2.3.1), shareholders and strategic partners of BP are summarized:
(Figure. 4.2.3.1: stockholders and strategic partners of BP)
Berlin Partners Holding: The commitments of all Berlin Partner companies are summarized in Berlin Partner Holding. 50 company from the group of more than 160 licensees (the ''Berlin Partners'') also the company members of Partner für Berlin Holding. Berlin Partner GmbH is assigned by an agency contract with the fulfillment of the activities associated with the licensing agreements and the framework contract with the State of Berlin (beBerlin.com).
Berlin Tourism&Kongress GmbH
Visit Berlin is the official website of Berlin Tourismus&Kongress which provides information about tourism and congress. BTK is main organization who is responsible for the promotional activities to the visitors. They are the service agency for congress and tourism partners in the various markets. The supervisory board of this company consists of 8 members. Each shareholder appoints a member to the supervisory board. For international activities, BTK work closely with national tourist board (GNTB), and they have 4 representatives in US and UK. In order to exploit synergies and pool resources, be berlin and visit Berlin organize many international events together. Strategic partners and shareholders of BTK are summarized in the following (Figure_4.2.3.2):
(Figure_4.2.3.2: Shareholders and strategic partners of Berlin Tourismus&Kongress GmbH)
strategic partners
Berlin senate Berlin Airport Messe Berlin
(ICC Berlin)
berlin partner GmbH
partner hotels TMB: Tourism Marketing Brandenburg
Preferred agencies kulturprojekte Berlin
Visit Berlin Partnerhotels e.V 40% Investment bank Berlin 25%
Land Berlin 15% Flughafen Berlin-Schonefeld GmbH 5% Messe Berlin GmbH 5% TMB Tourismus-Marketing Brandeburg GmbH 5% IBB – Investment Bank Berlin 45%
Berlin Partners Holding – Capital City Marketing Ltd. 40% Berlin Chamber of Small Business and Skilled Crafts (HWK) 5% Berlin Chamber of Industry and Commerce (IHK) 5% UVB Confederation of Employers and Business Associations of Berlin and Brandenburg
5%
Strategic partners
City of berlin(Berlin Senate/ land Berlin) Berlin state bank
One interesting fact is that Berlin Tourismus&Kongress GmbH and Tourism Marketing Brandburg are mutual shareholders. They own each other`s 5% shares. Based on the interview answers, this is a way to establish more formal relationship. In this way they can influence each other when promoting the city and province. Based on the information provided by BTK, Visit Berlin had around 15 million budget for 2010; 46.7% comes from the subsidy from the city, 43.8% comes from self-generated income, and other part comes from the grants from the shareholders as well as marketing fees paid by the concentrated hotels.
Investment Bank Berlin
IBB is the promotional bank of the Federal Land of Berlin. Investment bank is the subsidy bank of city of Berlin, so the official financial supports/subsidy comes to the city marketing organizations through investment bank of Berlin. From the (Figure_4.2.3.1) and (Figure_4.2.3.2), it can be seen that IBB is one of the biggest shareholder of BTW and BP. As the biggest shareholder, IBB have influential role for decision making and supervision of the city marketing. With its long-term approach to sustainable economic and urban development it actively contributes towards developing Berlin as an attractive business and industry location.
4.2.4 City Marketing Policy Network of Berlin
In the following (Figure_4.2.4.1), the structure of the city marketing policy network of Berlin is summarized.
(Figure_4.2.4.1: Berlin city marketing policy network structure) Berlin Toursmus& Kongress GmbH Berlin Partners (BP) Visit Berlin Partner
hotels e.V. Investment Bank of Berlin Land Berlin Flughafen Berlin-Schonefeld Mess Berlin TMB Tourism-Marketing Brandeburg
Investment Bank Berlin Berlin Partners Holding
UVB Berlin Chamber of Small
Business and Skilled Crafts (HWK)
Berlin Chamber of Industry
and Commerce (IHK)
Land Berlin
Mess Berlin Investment bank of Berlin
Partner hotels Preferred
Visit Berlin be Berlin
City marketing Network: Berlin
Strategic
partners Strategic partners
Berlin Airport
Berlin partner GmbH
Partners (companies, educational organization)
Chamber of industry and commerce Berlin Senate /Land Berlin
Deutsche Zentrale Fur Tourismus Berlin partner GmbH
It can be seen in this table that Berlin has two city brands: visit Berlin and be Berlin. Visit Berlin mainly promotes the city for the tourist, congress as well as for the inhabitants; be Berlin mainly promotes the city for the national and international investors, as well as inhabitants. There is no one generalized city marketing plan. Also there is no clear city marketing policy from the city. So these two organizations do their planning separately. But the city of Berlin and Investment bank of Berlin are the common shareholder and strategic partners of these two organization and they play an important role in decision making and supervising the city marketing activities. In addition, there are promotion organizations at province level (TMB: Tourism Marketing Brandburg, Deutsche Zentrale Fur Tourismus) and national level (German convention bureau, German tourism bureau) also involve in Berlin city marketing in different level by becoming a shareholder or strategic partner of Berlin city marketing organizations.
In the following (Figure_4.2.4.2), the shape of the network is summarized.
(Figure_4.2.4.2: Shape of Berlin city marketing policy network)
From the table above, we can see the overall picture of the city marketing policy network. Two main organizations (BTK and BP) are responsible for the main city marketing activities. But comparatively Berlin Partners are larger in size, and have more financial resources and have more responsibility in city marketing (overall city marketing activity and one of the main consumer target group: business and investors). BTKG and BP have one common consumer target: inhabitants, so there are some
Berlin Partners Visit Berlin partner hotels Mess Berlin IHK HWK
Berlin Partner Holding UVB Mess Berlin Partner hotels Preferred agency Berlin Airport TMB: Tourism Marketing Brandburg
Kulturprojekte Berlin Berlin Tourismus& Kongress GmbH
Partners (companies, educational organization)
Chamber of industry and commerce Berlin Senate/Land Berlin/City of Berlin
Investment bank Berlin
