The Brand Called UK

To catch a new glimpse of an old country, walk into Dixons, Great Britain's largest electronics retailer. A few years ago, the chain was so uncomfortable with its identity that it even tried to disguise its Britishness; it called its house brand Matsui -- a lame attempt to sound Japanese. But on this Wednesday afternoon, the Dixons store near London's Oxford Circus exudes a different attitude. Young couples eye personal computers. Pagers hum on the hips of the hip. And a clerk hands out the store's latest marketing gambit: CD-ROMs that offer free Internet access. Queuing up politely for this cyberswag is a collection of Brits -- many races, several accents, equal numbers of women and men -- that defies the stereotype of a stale, pale, male kingdom.

Something's up in merry old England. For the past year, Great Britain has been trying to "rebrand" itself. Culturally adrift and economically uncertain, one of the world's most powerful nations has borrowed from the world of business to reshape its national identity. The effort hasn't always been formal or systematic. It has sometimes been comical. And it has definitely been controversial. Advocates say that rebranding Britain is smart business for a modern country. Detractors say that it's slick and dirty spin-doctoring, unworthy of a great nation. But on one thing all sides agree: The man who forced the idea into the national conversation is Geoff Mulgan.

Earlier this decade, Mulgan, now 37, founded a think tank called Demos. Within a few years, Demos rocketed from obscurity to prominence -- fueled by a stream of books and pamphlets that challenged the nation's conventional political wisdom. Then, in 1997, Mulgan and Demos researcher Mark Leonard published a book, "Britain?", that advanced the think tank's most provocative argument yet: that the UK could rebuild itself by rebranding itself. "We have spent most of this century in relative decline, after ending the last century as the top nation in the world," Mulgan says. "That left us with a heavy legacy. We had created a set of institutions that had served us well in the industrial economy. But those old ways of thinking were preventing us from moving into the future."

According to Demos's research, customers around the world considered British products to be fusty and of poor quality. Foreign companies viewed Great Britain as an island that time forgot -- stuck in the past, hostile to free trade, riven by labor disputes. And potential tourists stayed away, believing that they would encounter lousy weather and crummy meals served by haughty hosts.

In fact, the country was on its way to becoming something altogether different -- a hub of fashion and design, a destination for entrepreneurial immigrants, and one of the leading information-technology centers in Europe. But the nation's image had not yet caught up with this new reality. And a series of high-profile events had tarnished what remained of Britain's positive image. Hong Kong left the British Empire. Princess Diana died, and the monarchy came under fire for its remoteness. "The British myth was coming into question," Mulgan says. "A lot of people were feeling a need to rethink what their identity was."

Mulgan, who once worked as a concert promoter, addressed that yearning with intellectual force and public-relations panache. It was out with "Rule Britannia" and in with what was fast becoming known as "Cool Britannia."

Behind the catchy slogan was a solid idea -- that of what Mulgan calls a nation's "identity premium." Each year, the UK spends about £800 million (roughly $1.3 billion) on promoting itself overseas. But without a coherent strategy to guide that spending, Mulgan believes, the money buys little more than a trickle of disconnected messages, which are scarcely noticed in the global ocean of information. What a country should do is devise a marketing strategy that builds an attractive brand. Several countries have already figured out the rules of this new game. Spain has rebranded itself -- in part by using Joan Miro's bright and lively "Espana" painting as a national logo and as a symbol of the nation's post-Franco optimism. Ireland, long seen as a sleepy land of pastures and pubs, has recast itself as a high-tech "Celtic tiger." Cities have been in this game for years. That's why so many of us love New York.

But Mulgan argues forcibly that the benefits of branding go beyond the realm of travel and tourism. When a nation builds an attractive brand, it creates a patina -- an "identity premium" -- that attaches to businesses operating out of that country. If the brand called UK is strong, then an identifiably British design group (for example) will attract lots of clients. And that company will be able to charge as much as design firms based in other nations do -- plus an identity premium for being British. Because branding can generate real economic advantages for a nation, Mulgan argues, a modern government not only must protect the nation's shores; it must also boost the nation's brand equity.