Kirill Rozhkov is a Fellow of the Institute of Place Management and Professor at the Faculty of Business and Management (Department of Company Marketing) at the Higher School of Economics (HSE) in Moscow. He has 15 years’ experience with conceptual and empirical research in the fields of place management and place marketing, and he teaches place marketing and branding to Master students and local representatives. In 2016 the HSE alumni selected him as Best Teacher. His recent research has addressed issues such as the theoretical model of place market analysis and how to identify product concepts of places. His paper “Places, Users, and Place Uses” has been selected by the editorial team of the Journal of Place Management and Development as a Highly Commended Paper in the 2016 Emerald Literati Network Awards for Excellence. As an expert, Kirill supervises several projects aimed at developing marketing and branding strategies for municipalities.
Kirill Rozhkov, you are a “Professor of Business Marketing”, but at the same time you research and publish on Place Marketing. How are the two linked?
Kirill Rozhkov: Recently at a conference on place marketing, I heard a presentation about how a newspaper in Moscow was advertising tours aimed at various target audiences. The entities placing the advertisements were generally local and regional administrations as well as travel agencies, but some advertising space has traditionally been given to private advertisers. And it’s how this private advertising was presented that demonstrates the fundamental relationship between classical and place marketing.
Each tour was followed by a corresponding set of commercial product ads. For example, family weekend tours were advertised alongside ads for children’s summer clothes, family bikes and children’s car-seats. Advertisements for multi-day mountain hikes were placed alongside ads for tents, mountain boots and diarrhea medicine.
Any tour is, in essence, a product whose value to consumers lies in its ability to give them the opportunity to spend time in a specific area. However, in order to spend time in a particular way, one needs a package of private goods and services and the appropriate expenses.A tourist’s budgets of time and money fit together like puzzle pieces. A place offers the tourist the ability to spend time in a certain way, and businesses fill this time with the necessary goods.
Now picture a resident of a particular place instead of a tourist. The logic is just about the same. Any place with people living in it offers residents a certain way of spending their time. However, while the experience of a tourist is limited to a certain period of time, the experience of residents of a place spans their entire lifetime and is reflected in their daily activities and comings and goings. In a certain place, one can earn and spend money and spent their leisure time in a particular way, and in another place, these things can be done differently. For example, in the centre of Moscow, one can earn money and have a good time sitting in various cafes after work, but there is a lack of shops with everyday items there, so shopping is difficult. And the reverse situation can be observed in residential districts — residents typically do not work and do not spend their free time near where they live.
To be involved in the value chain created by a place means to receive a portion of the economy of scale that arises when selling the place at large.
I would say that a place determines the residents’ lifestyle. In the geographic sense, a place is a space; in the social sense, it is a community; in marketing sense, it is a product that gives residents the opportunity to live a certain lifestyle, or to use the space and time in a certain way. And businesses encourage residents to spend money on goods and services that are complementary to this place product.
Finally, the question of how the marketing activities of places and businesses are related is quite interesting. The examples in the beginning show that place marketing can play the role of ‘locomotive’ for business marketing. This role is definitely big for small businesses selling locally. To be involved in the value chain created by a place means to receive a portion of the economy of scale that arises when selling the place at large. But to become involved, every business should see itself as a part of the place production and promote the entire value chain and not only itself. A taxi driver delivering someone from the airport can tell his passenger about the best hotels; the receptionist at the hotel can inform him about where to eat within his budget, the waiter in the restaurant can let him know about the most interesting hiking routes, and local residents encountered along the way can offer advice about the most interesting local landmarks.
The role of place marketing as a ‘locomotive’ for big businesses that sell products nationally and globally is less obvious. On the contrary, the place itself typically depends on these businesses, regarding them as potential target audiences.
However, the global crisis, which we are observing in real time, might change the situation. The reappearance of barriers in Europe and the probable rise of consumer patriotism may limit opportunities to sell globally. In that case, local lifestyles may become an important framework for global and national corporations which may be forced to adapt to local markets and, thereby, to join local value chains.
Summarizing, for me, people’s lifestyle is the main phenomenon that links business marketing and place marketing. People can alternately take the roles of consumers of tradable goods or place users, but still operate in the framework of the same lifestyle. By the way, lifestyle market segmentation is considered to be very advanced in the mainstream marketing, although it is very difficult and, therefore, less used than the other segmentation tools. When segmenting residents and visitors who use combinations of spatially distributed goods, lifestyle segmentation is almost the only possible tool.
Thus, this research topic is equally important for both business and place marketing. My university, faculty, and department recognize this, kindly supporting my research work.
You recently published a paper on “How to capture the idea of a place?” in the Journal of Place Management and Development. Can you share with us some of the ideas from that paper?
Kirill Rozhkov: In this paper, I show how one can analyze the lifestyle of the residents for marketing purposes. I wondered whether it is possible to judge what lifestyle people live by studying tangible attributes of their place. That is, bearing in mind the above mentioned, what product does this place offer?I realized that this is possible when I looked at the following wonderfully satirical portrait of Bracknell (Great Britain).
Bracknell is not short of night life […]. Near the Ball Fountain is “The Point” leisure complex. Here, under one roof, one can find a Bowling Alley, a ten screen cinema, two nightclubs (“Stabbings” and “Toxins”), and a casualty unit. Thus, it is possible to go bowling, see the latest film, get stabbed, and have a blood transfusion all in the same evening. This is a popular pastime with the youth of Bracknell www.trousers.co.uk/bracknell/leisure.html (accessed 3 November 2015).
Note that each of these ways of spending time is supported by the appropriate place asset, and as a result, the product of Bracknell (night life) is formed by the value chain under the name of ‘leisure complex’. And then I suggested that, walking around any city and looking at its value chains, one can deduce a similar “formula” of its product idea as its residents’ and visitors’ dominant way of using the place.
Why it this important for place marketing? First, because any place is used by people (i.e., is a product), regardless of whether it is marketed or branded. And when a marketer or brand manager develops and proposes a new place product or brand, he or she should be aware that the place is already a product that supports an established way of life. And if the marketer would like the local community to support the place marketing or branding, he needs to be sure that the residents are ready to change their lives. That’s why whatever words and visual images the marketer uses should be translatable into terms of residents’ lifestyles “before” and “after” marketing.
The existing methods of place product analysis and development are either intuitive and, thus, difficult to reproduce, or reproducible, but sacrificing the specificity and uniqueness of the marketed place.
Second, the place identity that is necessary for shaping the unique value proposition of the place is determined not only by its geography, history, cultural heritage, but also by the everyday life of its residents. They “write” a unique story about their place every day with their own words and actions (this phenomenon has been called “place narratives”). And the question is, how we can recognize different value chains among the masses of detailed data that form place narratives? How do we condense this complex mass of data into a specific, comparable and manageable generalized formula of place product?
The existing methods of place product analysis and development are either intuitive and, thus, difficult to reproduce, or reproducible, but sacrificing the specificity and uniqueness of the marketed place. This was the most serious challenge to the study. It was necessary to find some tool for describing the more general (and thus comparable) features of a place, on the one hand, with minimal loss of the specificity that shapes the place identity, on the other.
The image of the doctor who makes a prescription that reflects proven medical practice, while also taking into account the individual characteristics of the patient, is best suited to illustrate this challenge. The role of a doctor was played by the typological method, which allows the diversity of a phenomenon to be reflected and generalizes it at the same time. One more metaphor is provided by LEGO blocks, whose standard elements can form unrepeatable combinations.
We successively ‘sifted’ the empirical data about everyday life and the physical environment of five districts of Moscow through interconnected morphological classification tables which describe some nominal places at different levels of detail and resemble sieves of different size. A more general table (typology of place use patterns) was taken from our previous study “Places, Users, and Place Uses”, while a more detailed one (typology of product technologies) was developed in this study.
As a result, we obtained five different formulas for the implemented product concepts (shaped into templates called “place for… (list of resident needs a place meets and activities it encourages)). These concepts are not as unique as the Bracknell formula (see above), because they have combined typical elements of the morphological tables. However, they do not repeat one another and embody the distinctive features of the districts being studied.
I consider the applied set of typologies the main result of the study. Now it can be used in constructing product concepts for any place in Russia and countries with similar cultures. In this and next year, I would like to conduct cross-cultural research to increase the analytical power of the tool that was developed and would be happy to combine efforts with colleagues outside Russia who are interested in delving deeper into this topic.
Is Place Marketing an issue in Russia today? What are your experiences working on the field?
Kirill Rozhkov: In recent years, the topic has been gaining popularity in Russia. Russian places have been more focused on their images than their products, so place branding has been more common than place marketing. Place branding in Russia is now at the end of a stage which has been aptly named “a parade of capitals and homelands”. According to brand managers, the easiest way for places to become recognizable is to choose a character or item that has nationwide renown, and to attach its name to a place name. And to achieve superiority in recognition, it is necessary for a place to call itself the home of this character, or the capital of this item. So now we have the third capital of Russia, the Volga capital, capitals of kindness, Russian province, homelands of Father Frost (Russian Santa), Baba Yaga (Russian fairy tale character) etc., — the total number is greater than 40.
Despite the seeming flippancy of this struggle, I think, is a mandatory stage in the development of Russian branding. In many cases, branding plays an important role as an instrument of identity of local communities, even if the awareness and recognition of external audiences are not achieved.
I think a deeper search for distinctive place features will soon be initiated. And, concurrently, brand managers will be asked questions of what they want people to associate with the chosen symbols and what decisions regarding the place they want people to make — especially now, when the number of nationwide symbols up for the taking is getting smaller, while the ‘capital’ and the ‘homeland’ titles are becoming so commonplace that they rather depersonalize than identify places.
In many cases, branding plays an important role as an instrument of identity of local communities, even if the awareness and recognition of external audiences are not achieved.
As for place marketing per se, it is becoming a trend for cities to attempt to attract tourists, especially those who have stopped going abroad since the rouble devaluation. There is no shortage in landmarks which could be interesting for tourists, and these landmarks are of primary interest to marketers. However, the problem is that multiple stakeholders must cooperate with one another when creating basic tourist infrastructure.
Marketing activities targeted at residents are less common. In the last few years, authorities of big cities have been allocating considerable funds for the development of friendly public spaces and the promotion of a comfortable urban environment in general. However, different resident groups often perceive these urban development projects ambiguously. Recently, small stores in the center of Moscow were destroyed, and Muscovites became were divided into two camps: lovers of historical landscapes and visitors of small stores (who typically patronized these stores on the way home from work).
As I see it, the marketability of urban development projects in Russia promises to be a very urgent issue in the near future. That is, it will be of great importance to ‘translate’ urban concepts into the language of preference profiles and the behavioral patterns of place users, which I mentioned above. This should allow the place market to be segmented the by the criterion of residents’ loyalty to these projects, thus making it possible to understand precisely which segments could be involved and why.
Due to the high degree of centralization of Russian public governance, the ‘top-down approach’ to urban development is dominant. However, a lot of informal local communities without access to local budgets and administrative systems live independently and try to improve their own places by themselves. The issue of place marketing and place branding is another reason for authorities and local communities to meet and join forces.
As a researcher and teacher, I can help them do so. In my honest opinion, local stakeholders should themselves develop marketing and branding strategies for their own places by working with each other. Otherwise, it will be difficult to engage them when implementing these strategies. Strategy is something that cannot be outsourced. Stakeholders should be involved not only as respondents and executors but also as creators. And my task is to help (and not to replace) them. That is, to provide them with convenient analytical and learning tools in the form of workshops with representatives of the authorities, NGOs, informal communities, businessmen, active citizens, etc., of Russian cities and towns. The first results are hardly ever excellent, but they are obtained by stakeholders themselves and this motivates them to continue their efforts.
Kirill, you are a fellow of the IPM. What do you expect from the Institute?
Kirill Rozhkov: I hope the IPM will continue collecting and disseminating the best world practices of making places better. It is also very important to regularly remind business schools worldwide about the relevance and success of disseminating business management approaches into the public sector, urban development and other non-commercial fields.
The interview was conducted by Ares Kalandides