The essence of territorial marketing. Common features and differences between “territorial marketing” and “territory marketing”

27. Country marketing: image and competitiveness.

In the literature on territorial marketing, there are different interpretations of this concept.

Kotler and his colleagues use the term “place marketing” and argue: marketing provides the most comprehensive approach to solving the problems of a territory, so in the content of this approach, promoting a territory is only a small part. Kotler pays special attention to marketing strategic planning, which should be carried out jointly by residents, the business community and the territory's authorities. He is confident that the purpose of marketing is to strengthen the ability of a territorial community to adapt to market changes, increase opportunities, and increase the vitality of the community. Strategic marketing of territories initiates the construction of a community that would satisfy the needs of all key social institutions. The main tasks of territory marketing, according to Kotler, are to identify and diagnose the state of the community, its main problems and concerns, and the reasons for their occurrence; developing a vision of the prospects for solving these problems based on a realistic understanding of the values ​​of the community, its resources and capabilities; development of a long-term step-by-step plan for investment and community transformation.

Strategic marketing decisions, according to Kotler, involve improving four groups of the most important marketing factors, namely:

· orientation of basic services and infrastructure to meet the needs of the three most important target groups of consumers of the territory - residents, businesses, guests;

· creation of new positive features of the territory in relation to the quality of life, implementation of entrepreneurship with the support of society to attract new investors, entrepreneurial layers and individuals;

· communication and promotion of new positive features, quality of life and the overall image of the community;

· ensuring support from the population and community leaders for attracting new companies, investments, and guest programs.

These four groups of factors ensure, according to Kotler, the ultimate success in attracting and satisfying the five target groups of the territory:

· producers of goods and services;

· management of corporations and regional authorities;

· external investors and exporters;

· tourism and hospitality sectors;

· new residents of the territory. 1

Among domestic authors - scientists, practitioners and popularizers of territory marketing, the most prominent are A. M. Lavrov, V. S. Surnin, K. B. Norkin, I. V. Arzhenovsky. And here it is quite appropriate to present the opinions of these professionals.

A. L. Mnatsakanyan from the St. Petersburg University of Economics and Finance, having complained about the multiplicity of terms such as “state marketing”, “municipal marketing”, “territorial marketing”, nevertheless saw in their diversity certain positive signals about the effectiveness and fundamental possibility adaptation of the concept and methods of business management in the field of public administration at its various levels. This is helped by: a) decentralization (autonomization) of territorial management, increased independence in the disposal of territorial resources and increased responsibility for the progress and results of the implementation of management decisions; b) its “socialization” as a force for territorial bodies to step up efforts to meet the needs of the population.

A. L. Mnatsakanyan strives to present the territorial administration as a specific organization for servicing consumers (the population living in a given territory), focused on meeting their needs and requests. Supporting the division of marketing according to its orientation into internal and external, the researcher emphasizes that the population of the territory can be considered as an internal consumer of the entire complex of social services, since it alternately acts as a direct or indirect producer (“staff”) and a consumer of state or municipal social services, where the administration and government bodies perform management functions. The internal product, in accordance with traditional goal-setting in territorial management, is the creation of decent living conditions for residents of a given territory, both in terms of meeting their social and living needs and in terms of providing jobs. The specificity of territorial marketing, according to A. L. Mnatsakanyan, is that maximizing the internal product becomes an important factor in the successful external marketing of a territory, aimed at fighting with other territorial entities for markets for their (local, regional) products, for investments and for the creation new jobs in an open market economy. Internal marketing, to a large extent shaping the qualifications and motivation of the population, begins to work on the external product of the territory. But, the author emphasizes, the difference between territorial management and business management for marketing is very significant, since for a territory, in his opinion, unlike a company, it is internal marketing that implements the target management function, while external marketing plays a subordinate role.

Without a doubt, all the expressed points of view, the positions of researchers and practitioners have serious grounds and look quite promising. What can be said by summarizing all these points of view and positions? Let’s try to “make friends” of them, especially since they basically do not contradict, but complement each other.

First: application levels. In almost all cases, the conversation about territories takes place at the levels of “region” - “municipal entity” - “more local place”. Almost no one talks about the use of marketing at the country level, and even more so at the level of interstate associations (although we participate in a number of such associations). The only exception is F. Kotler (book “Marketing of Nations”). The megalevel is also mentioned (but not developed) by A. M. Lavrov and V. S. Surnin. The funny thing is that marketing managers for certain products, specialized in specific countries, have existed in all self-respecting corporations for quite a long time, but marketing managers of the countries themselves are still hard to find during the day, especially in Eastern Europe.

Second: purpose, mission, main areas of work. I.V. Arzhenovsky, not without reason, believes that territory marketing is an advanced idea, a philosophy that requires focusing on the needs of target groups of buyers of territory services. According to F. Kotler, marketing is a tool for the strategic development of a territory and the most comprehensive solution to its problems. The purpose of marketing is to strengthen the ability of a territorial community to adapt to market changes, increase opportunities, increase the vitality of the community, and not only improve the image and promote the territory. K. B. Norkin agrees with the master, considering urban marketing as a means of responding to modern challenges and contradictions in city development.

According to A. M. Lavrov and V. S. Surnin, territory marketing is intended to ensure a high level and quality of life for its population. A. L. Mnatsakanyan agrees with them, asserting the dominant role of the “internal product” in creating decent living conditions for the residents of a given territory, which will become the main competitive advantage in line with “external marketing”. French researchers (A. Dayan) traditionally emphasize that marketing is designed to improve the image of a territory, attract industrialists, and force people to talk about it. By the way, it is with him that, for example, the developers of marketing strategies in the Omsk region and the Republic of Buryatia agree. The theoretical part of both strategies (here they are identical) states that “regional marketing is the use of marketing tools, especially advertising, promotion and sponsorship to increase awareness and improve the image of the territory based on advanced ideas and achievements, focusing on the needs of target groups of product buyers and services of the territory."

However, although the developers of the regional marketing strategy declared the priority of image goals, they actually followed a much more constructive path of real transformation. For example, in the program “Events for the implementation of the concept of the regional marketing strategy of the Republic of Buryatia”, training is planned as a starting point in order to improve the marketing culture of management specialists of the republic and its economic entities, then - specific activities, including the reconstruction of the territorial highway, and ultimately - access to the markets of neighboring regions of Siberia, the Far East, and Mongolia bordering the republic.

Third: marketing target groups. Among them are (according to Kotler): producers of goods and services; corporate management and higher regional authorities; external investors and exporters; tourism and hospitality; new residents of the territory. It is absolutely legitimate to add to this list: a) the population of the territory, b) local businesses, including medium and small ones. Many domestic researchers talk about this.

Fourth: functions. According to Kotler, this is: identifying and diagnosing the state and problems of the community, the causes of their occurrence; developing a vision of prospects for solving these problems, taking into account the values ​​and resources of the community; development of a long-term step-by-step plan for investment and community transformation. Actually promoting the territory is only one of the functions. According to A. M. Lavrov and V. S. Surnin, among the functions is the study of the market, demand, prices for the total products of the region, to realize its full potential from the position of both internal (regional) and external (outside the region) needs.

Fifth: which term is more logical to choose? As we see, there are many options: territorial marketing and marketing of territories, internal and external marketing, state, regional and municipal marketing, marketing of countries, regions, local places... And if it is not so difficult to understand the levels of an object, then in relation to Whether, for example, territorial marketing is internal, and territorial marketing is external, there is clearly no unanimity.

Some authors who develop regional problems believe that regional marketing is the marketing of regional goods; others - that this is “marketing carried out at the regional level, reflecting and absorbing the specifics and characteristics of a particular region” 1 ; still others focus on the fact that marketing a territory (in particular, a city) is designed to improve its image, attract industrialists, and make people talk about themselves; the fourth call for the integration of “intraregional” and “external” marketing of territories.

A few years ago, I proposed to fix the main components of territorial marketing as different, but certainly interrelated; hence the following definition of it: territorial marketing - This is marketing in the interests of the territory, its internal subjects, as well as external subjects in whose attention the territory is interested. In this regard, we can highlight:

territory marketing, the object of attention of which is the territory as a whole from the position of its compliance with the specific needs of various target groups of consumers of the territory; it is carried out both inside and outside the territory;

marketing on (in) territory, the object of attention of which is relations regarding specific goods, services, etc., carried out within the territory.

We consider a region, a territory, as a subject that provides the role of a consumer not only to itself, but, first of all, to other subjects (external and internal in relation to the territory). It is their successful consumption of regional resources, products, services and opportunities that allows the region to ultimately build and increase its own well-being. Apparently, there is no need to prove that the approach that represents the region, the territory as a producer focused on consumers, on the development of their demand in relation to the real resources and potential of the territory, is much more marketing than the approach that actually concentrates the region’s attention exclusively on itself.

Topic 1: Theoretical foundations of territory marketing

1 Essence, goals, objectives of territory marketing

2 Marketing concept

3 Subjects of territory marketing

4 External and internal environment of territory marketing

Essence, goals, objectives of territory marketing

Marketing today is considered as:

1. branch of science that studies the market;

2. practical activities to promote products on the market;

3. business philosophy;

4. management system, type of management in a market economy.

State and municipal management at the present stage should be built on a marketing (market- and client-oriented) approach. This is the management of territories with a focus on the needs of market subjects and the impact on the environment and its elements. Without this, it is impossible to ensure the competitiveness of the territory and the market success of business entities within the territory’s borders.

Territory marketing affects two aspects of marketing activities:

1. marketing on (in) territory

2. marketing of the territory itself as a management object

1. Territory marketing examines the marketing relationships of entities within the territory.

2. Marketing of the territory itself –

· managing the attractiveness of the territory through targeted information and advertising activities;

· systematic promotion of the interests of the territory and solving problems of its development (D. Vizgalov);

· marketing, which considers the territory as a whole as an object of attention and promotion, is carried out both inside and outside its borders, is aimed at the creation, development, effective promotion and use of the competitive advantages of a given territory in its interests, in the interests of internal and external entities, in cooperation with which the territory is interested.

Territory marketing levels:

1. the country as a whole;

2. region;

3. municipality;

4. local place.

Territory marketing is based on a strategic approach and public relations.

Territory marketing goals– creating, maintaining, changing attitudes and/or behavior in relation to specific places.

Territory marketing objectives:

1) ensuring that internal and external marketing subjects understand the uniqueness of the territory as a place of residence, recreation and an attractive opportunity for investment;

2) creating a positive image, the image of the territory;

3) formation and promotion of a territory brand (reputational profiling);

4) support for the process of forming and ensuring the implementation of the development strategy.

Territory marketing goalscan be:

· ensuring attractiveness and prestige of the territory as a whole;

· ensuring the attractiveness of natural, material, technical, financial, labor, social and other resources;

· providing opportunities for the sale and reproduction of these resources on the territory.

Territory marketing objectives:

· formation and improvement of the territory’s image, its business and social competitiveness;

· expanding the participation of the territory and its subjects in the implementation of international, federal and regional programs;

· attracting government orders to the territory and developing new types of activities in the territory;

· import of resources (increasing the investment attractiveness of the territory);

· export of resources (stimulating the use of resources of the territory outside its borders in the interests of development of the territory).

Branding– the most advanced specific form and core technology of territory marketing.

Branding ensures the promotion of the interests of the territory and solving the problems of managing its development. Territory branding appeared at the third stage of development of territory marketing

Stages of development of marketing in the territory and marketing of the territory.

Period	Territory Marketing Model	Peculiarities	Territory marketing model	Peculiarities
1) late 19th – early 20th century before the Great Depression	Production-oriented	Demand is unsatisfied; sales are completely determined by production requirements	"Chasing Factory Chimneys"»	Industrial stage of development (early); the only goal is to attract industrial facilities and corresponding investments to the territory. The use of aggressive, rough and simple schemes. “Territory sellers” act by trial and error. Mass marketing of products that are not tailored to the needs of customers is used.
2) first half of the 20th century	Market oriented	Achieving primary saturation; search for new markets (geographical, in the context of new product categories and consumer niches). From the importance of the “sales volume” category to the importance of the “market share” category that needs to be captured.	Targeted marketing, marketing mix.	Industrial (late) stage of development; instead of a single goal (attracting business), many goals appear (preservation of existing enterprises, creation of new ones, export promotion, foreign investment). Specialized territory marketing segments markets and buyers by tailoring products to their needs.
3) mid-70s. 20th century – early 21st century	Customer-oriented	The main markets are divided; relevant questions about their redistribution, division, clustering, and the choice of target consumer groups; new approaches to promotion are being formed (the principle of target audiences in advertising, globalism, innovation, the use of public relations).	Strategic niche marketing, territory branding	Post-industrial stage; transition from marketing in a territory to marketing the territory itself as a complex product. Formation of a market for a territory, a place for defining itself as a special territory with specific competitive advantages for target industries. The territories improve products and services in their niches, creating value for consumers; the territories pay special attention to attracting and developing human resources. Place branding technology is being developed; It is based on the concept of the economy of events and images. Strategic marketing is considered as a philosophy of early rational development of territory management.

Marketing concept

Stages of marketing evolution:

Transcript

2 Sachuk Tatyana Viktorovna Territorial marketing “Tutorial” series Editorial manager Project manager Leading editor Production editor Literary editor Art editor Proofreaders Layout S. Zhiltsov E. Bazanov E. Rumanovskaya E. Egereva T. Belova S. Malikova L. Aleshicheva, E. Khristich S. Seniva BBK ya7 UDC (075) Sachuk T.V. S22 Territorial marketing. SPb.: Peter, p.: ill. (Tutorial Series). ISBN The textbook presents the modern concept of territorial management. The main issues of territorial marketing are considered: the marketing environment of the territory, a set of territorial marketing means, segmentation, positioning and differentiation of the territory, competitive advantages and competitiveness of the territory, business strategies for the development of the territory. Consumer behavior in territorial marketing is analyzed, the process of marketing implementation is presented, significant attention is paid to the implementation of territorial marketing of a country, region, and municipality. The textbook is intended for students of higher educational institutions studying in the specialty “State and Municipal Administration”, graduate students, university teachers, researchers, government and municipal employees, as well as everyone interested in the problems of socio-economic development of the territory. Peter Press LLC, 2009 All rights reserved. No part of this book may be reproduced in any form without the written permission of the copyright holders. ISBN Signed for printing Format 60 90/16. Conditional p.l. 23. Circulation Order Peter Press LLC, St. Petersburg, Petergofskoye Shosse, 73, lit. A29. Tax benefit All-Russian product classifier OK, volume 2; educational literature. Printed from ready-made transparencies at LLC Printing House Pravda 1906, St. Petersburg, Kirishskaya st., 2. Tel.: (812) , (812)

3 Contents Introduction... 7 Chapter 1. Territorial marketing: essence, marketing environment, set of means of implementation Prerequisites for the use of marketing theory in territorial management The essence of non-profit marketing The essence of territorial marketing Subjects of territorial marketing Marketing environment of the territory: internal and external environment of the territory Complex of means of territorial marketing Territorial product Price of the territorial product Location of the territorial product Promotion of the territorial product Conclusions Terms and concepts Questions for self-control Literature for the chapter Chapter 2. Consumers of resources and public goods of the territory. Consumer behavior General characteristics of consumers in territorial marketing The influence of individual differences on consumer behavior Individual capabilities Knowledge Consumer attitudes Motivation and interest Personality, values, image and lifestyle Impact of environmental factors on consumer behavior Culture Social status Personal (personal) influence Family influence... 85

4 4 Contents Influence of the situation Psychological processes influencing consumer behavior Information processing Training Changes in consumer attitudes and behavior Conclusions Terms and concepts Questions for self-control Literature for the chapter Chapter 3. Market segmentation in territorial marketing General approaches to macro-segmentation in territorial marketing Needs function WHAT is satisfied Technologies HOW the needs of consumer groups are met WHO is a consumer and receives satisfaction of their needs and desires Characteristics of the main consumer groups in territorial marketing General approaches to micro-segmentation in territorial marketing Attractiveness of market segments in territorial marketing Conclusions Terms and concepts Questions for self-control Literature for the chapter Chapter 4. Positioning and differentiation of territory Positioning in territorial marketing: theoretical aspect Differentiation of territory: theoretical aspect The process of choosing a territory as a place of residence and/or carrying out activities Conclusions Terms and concepts Questions for self-control Literature for the chapter Chapter 5. Analysis of competition in territorial marketing Formation of competitive relations between territories Competitiveness of the territory Classification of competitive advantages of a territory

5 Contents Competition and cooperation of territories. Development of state regional policy in conditions of competition between territories for resources Conclusions Terms and concepts Questions for self-control Literature for the chapter Chapter 6. Strategic management of the territory and territorial marketing Development of business strategies for the territory Selecting priority areas of activity “portfolio” strategy Selecting directions for the growth of business activity in the territory growth strategy Competitive strategy Functional strategies of the territory Investment strategy of the territory Investment climate of the territory Conclusions Terms and concepts Questions for self-control Literature for the chapter Chapter 7. Organization and management of territorial marketing Prerequisites and conditions for the implementation of territorial marketing Characteristics of the stages of implementation of territorial marketing Organizational stage Stage of collection and analysis of secondary and primary information Analytical stage of developing a territorial marketing complex and developing a territorial marketing policy Stage of implementing a marketing plan Stage of final control Conclusions Terms and concepts Questions for self-control Literature for the chapter Chapter 8. Territorial marketing of a country Where does territorial marketing of a country begin Analysis of the territorial product of the country Localization of the territorial product of the country

6 6 Contents 8.4. Price of the country's territorial product Processes of segmentation and differentiation in relation to country marketing The task of increasing the country's competitiveness Conclusions Terms and concepts Questions for self-control Literature for the chapter Chapter 9. Territorial marketing of the region Initial conditions of analysis. Means of territorial marketing of Karelia Territorial product of Karelia Price of the territorial product of Karelia Place of the territorial product of Karelia Promotion of the territorial product of Karelia Market segmentation of Karelia Positioning of Karelia Competitiveness and investment attractiveness of Karelia Conclusions Terms and concepts Questions for self-control Literature for the chapter Chapter 10. Marketing of the municipality The image of the “ideal” population point Introduction of territorial marketing at the level of a municipal district, rural and urban settlements City economy Marketing of an urban district How do cities become famous? Conclusions Terms and concepts Questions for self-control Literature for the chapter Conclusion Appendix

7 Introduction Economic and social transformations being carried out in Russia objectively require changes in the methodology and practice of territorial management. It is worth highlighting a number of reasons that create the need to improve territorial management in modern Russia: in the conditions of a mixed economy, the goals, objectives, methods and tools for implementing territorial management change; the reform of local self-government and the emergence of new forms of implementation of social policy are making significant changes to the mechanism of territorial governance at the municipal and regional level; the increased independence of regions and municipalities creates the prerequisites for territorial management to take into account the specifics of the territory to a greater extent, while the task of preserving the unified economic space of the country and strengthening the Federation is not removed from the agenda; in the context of increasing processes of globalization and economic integration, the quality and mechanism of territorial management are becoming one of the criteria for competitive comparison of countries, regions, and municipalities. Increasing Russia's competitiveness, creating conditions for an influx of investment into the economy, the need to take into account people's needs and provide the population with high-quality public services is an incomplete list of new management tasks. We have to admit that they do not receive an adequate scientific, methodological and practical solution to the problem of managing the territory in the context of growing competition for resources. There are no conceptual approaches to the development of a new philosophy of territorial management based on maximum satisfaction of the needs of residents and organizations (commercial and non-commercial).

8 8 Introduction of a commercial nature) in comfortable and safe living and operating conditions. The development of the theory and practice of territorial management can be achieved by applying the conceptual provisions of marketing in the management process. But the specifics of the object of application (territory) do not allow the use of traditional tools and means of commercial marketing; it is necessary to reveal the essence, develop methodological principles, mechanisms and tools for implementing a new type of marketing, territorial marketing. The use of territorial marketing aims the subject of management to organize the management of an object in a competitive environment in order to achieve consumer preference for the territory, which will be expressed in the development of existing and the influx of new human, financial, and material resources into the territory. The implementation of territorial marketing helps to increase the attractiveness of the territory as a place of residence, temporary stay, or activity. The implementation of territorial marketing will allow: to determine the role and tasks of the subject of management adequately to the new conditions of economic life; use fundamentally new methods and tools of territorial management, which will ensure high-quality provision of public services, allow for the organization of interaction between economic entities, and create the prerequisites for the successful implementation of private initiatives of a commercial and non-commercial nature; consciously use the competitive advantages of the territory, competently position and skillfully promote information about the territory; combine in the management process the achievement of social, commercial and budgetary goals for the development of the territory. Knowledge and practical skills of territorial management from the perspective of territorial marketing can be used in the development and implementation of forecasting and analytical documents and target programs for the development of the territory and individual industries, and can also serve as the basis for improving regional economic policy and mechanisms for its implementation. Practical recommendations for improving regional management based on territorial marketing (highlight

9 Introduction 9 and promoting the competitive advantages of the territory, creating an attractive image of the territory, etc.) may be of interest to state and municipal officials, representatives of business and non-profit public organizations, and all those interested in the socio-economic development of the territory.

10 Chapter 1 TERRITORIAL MARKETING: ESSENCE, MARKETING ENVIRONMENT, COMPLEX OF IMPLEMENTATION MEANS 1.1. Prerequisites for the use of marketing theory in territorial management Modern Russia is characterized by a new qualitative state of national economic, political and social life, the manifestation of which is the following processes. 1. Russia increasingly perceives itself as a single state, which tends to worry about national economic and political interests; the regulatory and stimulating functions of the state are fully realized. 2. Russia is becoming a significant part of the world space in the context of growing integration and globalization of economic processes. This makes relevant the issues of the competitiveness of the country as a whole, the search for a compromise between diverse economic interests, the formation of innovative management, as well as the intensification of the country’s participation in the processes of the international division of labor and labor cooperation. 3. The number of supporters of a new model of social development is growing, when changes in local communities and the formation of modern institutions of civil society become a significant element in the development of individual territories and the country as a whole. 4. The development of negative international trends (terrorism, drug trafficking) creates the preconditions for uniting the efforts of the world community and Russia in the fight against a common evil. 5. Russia, while remaining a multinational, multi-religious state, wanting to preserve its unity, strives

11 1.1. Prerequisites for using marketing theory 11 to support the desire of different peoples of Russia to develop national traditions, culture, and language. New territorial communities are being formed, new forms of interterritorial cooperation are being developed. These global and all-Russian trends suggest the need to consider the region as a multifunctional and multidimensional system. Historical and cultural status is the main criterion for identifying regions in modern European scientific practice of the Committee of the Regions of the European Community. A region is an area that represents a clear community from a geographic point of view, or a territorial community where there is continuity and whose population shares certain common values ​​and strives to maintain and develop its identity in order to stimulate cultural, economic and social progress. A region today is defined primarily as a natural-historical space within which the socio-economic and social activities of people living in it are carried out, united by common interests, goals, and ready to take responsibility for the decisions being implemented. Such an understanding of the region makes it possible to specify the object of study within the framework, for example, of the existing administrative-territorial structure of the country, on the other hand, to conduct research and manage the regional development of less strictly defined, but actually existing territorial communities, united by similar features, a specific culture, a value system, the fact of residence in a common area. For the successful socio-economic development of the country as a whole and individual regions of the country in particular, it is necessary to use the principles and methods of strategic management. In strategic management, the attitude towards the external environment fundamentally changes, since the possibility of taking active action to change the external environment of the territory is recognized. Strategic management of a territory is not only the process of developing the main strategic goals for the development of the territory, but also actions to achieve these goals, while constantly monitoring the development of the external environment for timely adjustment of practical steps and, if necessary, strategic goals. Management is carried out on the basis of flexible solutions, when many important tasks arise so quickly

12 12 Chapter 1. Territorial marketing: essence, marketing environment that they cannot be foreseen and it is necessary to make creative decisions in a real-time system. The implementation of strategic management involves the construction of effective organizational structures, high-quality selection and increased motivation of personnel, the formation of a management culture, increasing the efficiency of performing management tasks, and much more. Strategic management is a theory and practice aimed at ensuring the competitiveness and efficiency of the managed object in the long term in a constantly changing external environment. Strategic management of a territory involves making decisions about goals, means and actions through a targeted comparative assessment of various alternative actions in the expected conditions and in accordance with the selected development priorities of the planning object (territory). The main scientific tasks of territorial management are: finding ways to anticipate and overcome crisis phenomena in the development of the territory, developing mechanisms for sustainable socio-economic development; development of new forms of interaction between authorities and economic entities (residents and non-residents) of the territory; searching for mechanisms to enhance interaction between government bodies, the population and non-profit public organizations; search for new extra-budgetary financial sources; development of models of interterritorial cooperation; studying a new management culture, developing new management technologies. The beginning of the formation of strategic management of the territory should be considered the period of development of forecasting and analytical documents for the development of territories on the basis of the Law of the Russian Federation “On state forecasting and programs for socio-economic development of the Russian Federation” dated June 23, 1995 115-FZ. A number of Russian scientific institutes are actively involved in the development and implementation of concepts, programs, plans (other names were also used) for the development of the territory: Institute for the Economy in Transition, International Center for Socio-Economic Research "Leontief Center", Russian Academy of Public Administration, Foundation "Institute city ​​economics", institute

13 1.1. Prerequisites for using marketing theory 13 “EUROGRAD”, Institute of Regional Economics of the Russian Academy of Sciences, Russian Scientific Center for Local Self-Government and other institutions. In The author carried out work in the Republic of Karelia to prepare strategic plans for the development of municipalities. Analysis of scientific works and the author’s own experience allow us to identify the two most significant problems in the implementation of strategic management of the territory. 1. When choosing the principles for constructing forecasting and analytical documents, one should pay attention to the qualitatively new tasks of territorial management at the present stage. The main task of authorities in a market economy is the provision of public services, and the main actions of authorities are aimed at ensuring life, organizing and coordinating the actions of the subjects of the territory and creating conditions for improving the quality of life and socio-economic development of the territory. If by function we understand responsibility, range of activities, purpose, role, then forecasting and analytical documents of the territory should be built on a functional principle, through the main functions, the implementation of which is entrusted to the territorial government bodies and which are designed to ensure effective management in the area of ​​their powers (functions) . These can be life support functions, real estate management, social protection and security, social development, support for private initiatives, including production ones, support and development of all types of communications, development of the territory in general and individual administrative units in particular as places of residence and implementation activities. 2. It is important to understand for whom the territory management process is being carried out. The main customer and consumer of the results of regional management is the population of a given territory. The population entrusts executive and representative authorities with the implementation of the management process in the hope that the “collective manager” will be able to achieve maximum effect given limited resources and within the shortest possible period of time. The “collective manager” must maximize and effectively use all the resources of the territory. Considering the special

14 14 Chapter 1. Territorial marketing: essence, marketing environment of the digital resources of the territory, having identified the maximum possible range of interests of their owners and the possibility of their adaptation to market conditions, authorities must ensure balanced intervention in the production process for each group of resources. Fundamentally new goals and objectives of territorial management create the basis for the search for new methods, tools, management tools, and possibly adaptation of business methods to the practice of territorial management. The use of marketing theory in territorial management allows us to redefine the goals and objectives of management. In modern territorial management, the key indicator of success should be the maximum satisfaction of the needs of residents of the territory for public goods and services, the creation of more attractive conditions for living and the development of commercial and non-commercial activities than in other territories. The dual nature of marketing is manifested in the fact that, on the one hand, marketing is an area of ​​special knowledge and skills, for example, the ability to organize the process of sales and service and the implementation of other specific operations and actions. On the other hand, marketing is a management function, which implies, for example, market research and analysis, development of business and functional strategies. Marketing can be considered as an integrative management function that transforms the buyer's needs into enterprise income, since it quite strictly directs and modifies all other functions towards serving the consumer. Modern interpretations of marketing consider it as a business philosophy that determines the strategy and tactics of a company in a competitive environment. Thus, marketing today is considered as a single whole of three aspects: it is a special business philosophy, it is a set of tools with which a company studies the market situation and influences it, it is a management function within which planning, organization, control, stimulation and management of the market activities of the enterprise. How applicable is the modern interpretation of marketing to territory? What socio-economic processes must occur to make it possible and even necessary to use marketing theory in territorial management? Executing authorities

15 1.1. Prerequisites for using the theory of marketing 15 executive power, first of all, special attention should be paid to the following changes that have actually occurred: most of the property belongs to private individuals in individual and/or collective form, therefore, the executive power manages (in the old sense of the word) the business activities of such enterprises can not; The spatial mobility of a person has increased significantly, he is no longer “tied” to the territory by registration and has ample opportunities to choose his place of residence and conduct of business; the territory began to act as an object of comparative analysis when a person chooses a place to use his labor potential and available financial, investment, innovation, and social resources; the fulfillment of social tasks can no longer be fully ensured by financial support from the state. The volume of state social guarantees and their financial support have been reduced, and now the territory must decide what social guarantees and with what resources it can provide its residents; citizens living and conducting activities in the territory have become the main active resource that can create and increase the well-being of the territory in the process of their activities. It should be recognized that the broad personal freedom of a citizen in a market economy creates the foundation for intensifying the search: “Where can I satisfy my needs better?” A person begins to compare territories, and for the first time the territories are forced to engage in competition with each other in order to attract attention to themselves, to turn out to be a more preferable place for a person to apply their resources. The main task of territorial management should be to create conditions for retaining and attracting this active resource for the benefit of the development of the territory. It is necessary to understand what needs a person has as a resident and as a participant in production activities. Territorial management should be aimed at achieving by a person the maximum satisfaction of his needs and requirements, at maintaining the attractiveness, prestige of the territory, the attractiveness of the resources concentrated in the territory for a person when living and conducting activities in a specific territory.

16 16 Chapter 1. Territorial marketing: essence, marketing environment 1.2. The essence of non-profit marketing The process of managing a territory involves the provision of services to residents and organizations of the territory. Let's consider the specifics of marketing in the service sector. F. Kotler defined a service as any activity or benefit that one party can offer to another and which is largely intangible and does not lead to the acquisition of anything. A service is an intangible form of a product, represented by a set of goods, by purchasing which the consumer expects to receive a certain benefit. If we are really interested in the problem of meeting customer needs, then the “benefit” category more accurately reflects the underlying basis for purchasing a service (or product). As you know, benefit largely implies advantage. Benefit is, first of all, positive consequences, good, and to use means to use for one’s needs. Therefore, the concept of “benefit”, according to etymological criteria, is closer to the concept of “need”. An important note about the specifics of a service can be found in E. V. Pesotskaya: “A service is useful not as a thing, but as a specific activity.” Let us highlight a number of distinctive characteristics of a service: the service is intangible, the consumer has sensations, knowledge, impressions and relies only on his own subjective ideas; a service is inseparable from its producer, therefore proper selection and training of personnel in contact with the client are necessary to ensure the quality of the service; a service, unlike a product, is always more individual from the point of view of the manufacturer. The client may be interested in a specific performer, since it is he who evokes in the consumer’s mind positive associations and thoughts about his professional qualifications, exceptional experience and skills; it is extremely difficult to determine the quality of the service and achieve consistency of quality; since the process of providing a service and its consumption almost always coincide, it can be extremely difficult for the service user to prove the insufficient quality of the service and protect their consumer rights;

17 1.2. The essence of non-profit marketing 17 a service cannot be stored, it can only be in the process of providing it; the service cannot be stored and transported; the consumer of the service pays for it even before he has the opportunity to consume the service and is able to assess the level of satisfaction of his needs; Of all the traditional tools of the promotion mix for promoting a service, the most significant are personal selling and public relations. The increase in the number of service users is largely due to the existing good reputation and positive public opinion. The service can be provided individually or for a group of people and therefore be of a public nature and act as a public good. The special nature of public goods is that their consumption can only be joint and equal. Benefits such as defense, security, noise and smoke reduction, free education and health care, and public access to parks and museums cannot be provided to individuals without providing them to others. It is not enough for the consumption of public goods to be joint, it must also be equal for everyone, regardless of whether this person pays the full price for a given public good, pays part of the cost, or does not pay at all. Every public good is, to one degree or another, personal and divisible. This is also determined by the extent to which, in each specific case, different people recognize the value, significance, and usefulness of a given public good for themselves (how much I personally need this good), for example, how important is the fact of free vocational education to a lonely elderly person. Recognition of the different importance of a public good for a particular person leads to the understanding that the creation of public goods and their subsequent consumption should always be based on the foundation of social consent of potential consumers of this good. A public good should be produced only if a sufficient number of individual consumers have a need and see the high importance of this good for themselves. In this sense, the public good means some suppression of the minority; the opinion of the majority here becomes decisive. Another feature of public goods is that

18 18 Chapter 1. Territorial marketing: essence, marketing environment, the fact is that they are consumed through the mediation of executive authorities at the federal, regional, and local levels. In Russian civil law there is a clear division into commercial and non-profit organizations. In Art. 50 of the Civil Code of the Russian Federation defines the leading feature of all non-profit organizations that do not pursue profit as the main goal of their activities. The result of commercial activity that arises in the process of exchange and has the goal of making a profit can be called an economic effect. The result of non-commercial activity that arises in the process of exchange and is not intended to make a profit can be called a social effect. In this case, a certain specific product (work, service) is exchanged for the response of consumers of these products. The purpose of such activity is a certain benefit, a benefit created for society as a whole or for individual groups of the population. When assessing the activities of a non-profit organization, the fact of adding social value is important. In actual practice, economic and social effects merge. Non-profit enterprises can use the principles and methods of marketing with mandatory adjustments taking into account the specifics of the subject and the principles of conducting business. Non-profit organizations, as a rule, deal with the population, have resources, develop ideas, provide services, have limited resources, they need to meet the needs of the population and meet their expectations. Non-profit organizations, implicitly or explicitly, must conduct marketing activities in the struggle for maximum satisfaction of the needs of their clients and obtain the maximum effect (social, budgetary, economic) from their activities. Let us highlight the main differences between non-profit marketing and profit-oriented marketing, which consist of the specifics of the status and activities of non-profit entities and their role in society: the main goal of the activity is obtaining and maximizing the social effect; performance goals are more complex and less quantifiable; the “product” of activity is a public good, service, work, idea;

19 1.2. The essence of non-profit marketing 19 non-commercial entities are obliged to serve economically unprofitable market entities; the total costs of providing public goods may be lower than the individual costs of consumers for their acquisition or provided free of charge; non-profit organizations can receive government support; non-profit marketing is almost always addressed to consumer groups and is not individual in nature; Nonprofit marketing has two categories of clients: consumers and donors; public goods, services, work, ideas exist and are sometimes guaranteed to all members of society, regardless of the degree of need or significance of this service for a particular person; the benefits that the consumer of public goods receives are often indirect in nature and can become tangible only over time. Until now, scientists have not formed a clear opinion regarding the essence of non-profit marketing; the categorical apparatus and the main patterns of activity have not been fully defined. F. Kotler uses the term “marketing in the field of non-profit activities.” J.R. Evans and B. Berman point out that non-profit marketing is carried out by organizations and individuals who act in the public interest or advocate for a cause and do not seek financial profit. S. N. Andreev defines non-profit marketing as the activity of non-profit entities or individuals in a competitive environment, based on the principles of classical marketing and aimed at achieving goals not directly related to making a profit. According to the author, non-profit marketing is the marketing activity of non-profit entities and individuals in a competitive environment, associated with meeting the needs of the population, certain groups of the population for public goods, services, ideas that act in the public interest and are aimed, first of all, at maximizing the social effect . Territorial administration also does not involve making a profit, it is carried out for the benefit of all residents of the territory, and acts as a service

20 20 Chapter 1. Territorial marketing: the essence, marketing environment of services and allows you to satisfy the needs of residents of the territory for public goods. Nonprofit marketing can become a new philosophy of territorial management. The use of marketing theory in territorial management will help create maximum social effect by meeting the needs of the population for public goods, services, ideas and will create the preconditions for increasing the attractiveness of a particular territory as a place of residence and business. The essence of territorial marketing As is known, F. Kotler does not have the category “territorial” Marketing", he talks about place marketing as activities undertaken to create, maintain or change attitudes and/or behavior regarding specific places. Specific actions of place marketing can be determined by four aspects of the vision of the territory: marketing of housing, economic development zones, recreational areas, investments in land property. In the domestic scientific literature one can find a number of concepts that, to one degree or another, reflect the issues of the marketing approach to territory management, such as “regional marketing”, “place marketing”, “municipal marketing”, “city marketing”, “territorial marketing”, “marketing of territories”, “marketing on (within) the territory”. Let's conduct a brief analysis of these categories. In 1994, A. M. Lavrov and V. S. Surnin were obviously among the first to introduce the term “regional marketing” into the domestic scientific literature in the field of regional economics. The authors defined regional marketing as an element of the system of market relations, projected not at the micro level, but at the meso level, which is largely based on the economic-geographical approach, and not on the theory and practice of marketing. V. I. Butov, V. G. Ignatov, N. P. Ketova write that regional marketing is a certain way of thinking and acting at the regional level, a new business philosophy of active entrepreneurial activity in the region, which is based on the desire to satisfy the identified needs of specific people , consumer groups, enterprises and firms both in a given region and beyond (action in selected markets) in relevant finished goods, technology, services, information

21 1.3. The essence of territorial marketing 21 tions. This definition of regional marketing involves a search for activities that need to be developed to meet the needs of the population. In 1999, A. L. Gaponenko presented examples of regional marketing and defined the forms of its implementation in the form of marketing of land, housing, economic development zones, investments, and tourism marketing. In 2001, A. L. Gaponenko defined regional and municipal marketing as a system of measures to attract new economic agents to a region or city that contribute to the prosperity of the region as a whole, which to a large extent has a marketing approach to the tasks of regional development. Issues of urban marketing are also the subject of study today. For example, P.V. Kukhtin, A.A. Levov define the marketing of the urban environment through the marketing of the territories of urban settlements and the marketing of urban real estate, as a means of satisfying human needs by improving their living environment. T.V. Uskova proposes to consider city marketing in the broad and narrow sense of the word, in the latter case implying a tool that takes into account the interests of business for solving the problems of developing the city’s economy and its social sphere. T. M. Orlova defines the ultimate task of urban marketing in the form of the effective use of existing, as well as the formation of new advantages to attract economic agents to the city that can improve the well-being of its residents. Foreign practice in the field of urban marketing was widely presented in 1996 in the book “Local Authorities and Market Economy. Lessons from Western European experience,” which emphasized that urban marketing aims to make the city more attractive from the point of view of its residents and the businesses and organizations located there. In the domestic literature one can also find a number of definitions of municipal marketing. For example, municipal marketing is understood as a management system aimed at studying and taking into account demand, supply and market requirements for a more reasonable orientation of the authorities of the municipal management system towards meeting the needs of residents of the municipality for goods and services in the industrial and non-productive sphere. S. N. Andreev defines the scope of activity of place marketing, which is aimed at the formation, preservation or change of

22 22 Chapter 1. Territorial marketing: the essence, marketing environment of bringing consumers, intermediaries, contact audiences to certain “places”. In the commercial sphere, these are zones of economic interests of manufacturing enterprises, banks, financial groups, etc. In non-commercial areas, locations and objects of historical value, monuments of culture, architecture, architecture, museums, libraries and much more. E. P. Golubkov gives a number of definitions: place marketing, the definition is given according to F. Kotler; regional marketing is the same as territorial marketing; marketing territorial marketing in the interests of the territory, its internal, as well as external entities in whose attention the territory is interested. Another definition of territory marketing is given by S.V. Alekseev. Territory marketing in the narrow sense of the word presupposes the economic turnover of real estate, including land, and in the broad sense the attractiveness of the territory. A. P. Pankrukhin identifies three categories “territorial marketing”, “marketing of territories”, “marketing on (within) the territory” and gives them the following definitions: territorial marketing is marketing in the interests of the territory, its internal subjects, as well as external subjects, in whose attention the territory is interested in. Can be presented as territory marketing or territory marketing; territorial marketing marketing, which considers the territory as a whole as an object of attention and promotion, carried out both inside and outside its borders and aimed at the creation, development, effective promotion and use of the competitive advantages of a given territory in its interests, in the interests of its internal, as well as those external entities in cooperation with which it is interested; marketing on (within) the territory is an aspect of understanding the term “territorial marketing”, denoting the level and specific characteristics of the development of marketing relations of subjects within the territory regarding specific goods and services. We examined a number of categories that are used to determine the type of marketing, the object of study of which is the territory

23 1.3. The essence of territorial marketing 23 at the level of region, city, municipality. But special attention should be paid to two categories: “territorial marketing” and “territorial marketing”. You can imagine the differences quite well when we, for example, talk about bank marketing and bank marketing. Same with the territory. Territory marketing is a series of technical methods, skills, actions, the implementation of which will allow us to “sell” and offer to interested parties, for example, specific characteristics of the territory (convenient location of the territory, special resources, cultural heritage sites that make the territory more attractive for visiting , and other characteristics of the territory). Territory marketing involves the promotion of specifically filled information, perhaps special in forms and methods in connection with the specifics of the object (specific territory) that we are going to market. Territory marketing involves the development and implementation of a marketing action plan, which sets out measures to solve marketing problems, for example, increasing the image of the territory, increasing the number of external investments attracted to the territory, increasing the territory’s participation in regional and federal programs, etc. Category “territorial marketing " is more general. Territorial marketing is an independent type of marketing, which is characterized by the specificity of the object of study and the applicability of marketing philosophy to the activities of managing a territory. Taking into account the specifics of the object of marketing application, we adjust the methods, tools, and tactics of marketing actions. The territory as an independent object, the scope of application of marketing as a system of thinking and a system of action also involves clarifying the entire complex of marketing means and highlighting the specifics of a number of concepts. Regardless of the specific level of territorial formation, the “scale” of the territorial unit, the specificity of the complex of marketing means in relation to the territory is significant, and this gives us reason to introduce a category that reflects an independent type of marketing - territorial marketing. The “scale” of a territorial unit will determine the specifics of specific actions of government authorities to implement a set of marketing means.

24 24 Chapter 1. Territorial marketing: essence, marketing environment Territorial marketing can be considered as one of the areas of non-profit marketing, which is carried out by organizations and individuals acting in the public interest and advocating for any idea and not seeking direct profit. Territorial marketing can be defined as a special type of management activity undertaken with the aim of creating, maintaining and/or changing the attitudes and behavior of residents and non-residents represented by individuals and companies in relation to a specific territory. Territorial marketing is a modern philosophy of territory management, which is based on a new understanding of the role and functions of territorial authorities. The executive branch is called upon to effectively manage the resources of its territory and provide public services to the population, that is, to perform a number of functions within its competence, which can increase the attractiveness of the territory for living and doing business. The success of each department depends on how fully the needs of citizens for the services of a particular department are satisfied. Therefore, a thorough study and analysis of the criteria for preference for living and doing business in a certain territory becomes so necessary. The basic principles of personal freedom in a competitive economy should be accepted. A specific territory begins to be considered by individuals and legal entities as one of the options for using their skills, financial, material and other resources. Constant comparison of comfort, safety of residence, stability and predictability of doing business in specific territories determines the migration of persons and the movement of capital in a market economy. Territorial marketing forces you to take a fresh look at short-term and long-term development goals. It is necessary to achieve a constant correlation between such tasks as maximizing income from the use of the territory’s resources now and guaranteeing the development of the territory for the long term and for the purposes of all segments of society. Territorial marketing is becoming a new factor in regional management, the use of which leads to the successful socio-economic development of the territory through the optimal use of available resources and the entire potential of the territory.

25 1.4. Subjects of territorial marketing Subjects of territorial marketing When talking about territorial marketing, we mean “territory” in the broad sense of the word. In this case, to the geographical and legal concept of “territory” we add the entire complex of socio-economic relations that exist on it, we take into account the history of development and national traditions, the special character traits and temperament of its inhabitants, the pace of life that has developed over centuries and a large number of other intangibles factors. Territorial marketing involves a specific assessment of raw materials, human and material resources, and businesses of the territory. On the one hand, all this actually existing on the territory is a resource of the territory, on the other hand, it can be considered as potential for the development of the territory. Residents and businesses of a territory are themselves its resource; they also act as consumers of the benefits of this territory. Who in this case is the subject of territorial marketing, who carries out coordinating functions, who can become the initiator of territorial marketing? Territorial marketing aims to achieve sustainable development of the territory for the benefit of all segments of society. It is associated with meeting the needs of the residents of a given territory for safe, decent, comfortable, sustainable and predictable living conditions. This problem is beyond the power of one person or individual business entity. This is a task that is of a public nature and can only be solved through the joint efforts of all members of society. Let us consider the issue in more detail, for example at the local government level. In accordance with the Constitution of the Russian Federation, local self-government is recognized and guaranteed by the Constitution of the Russian Federation, independent or under its own responsibility, the activity of the population to resolve directly or through local government bodies issues of local importance based on the interests of the population, its historical and other local traditions. Consequently, we can distinguish two potential groups of subjects of local self-government: the population who has the right to use the forms of local self-government provided for by law (elections, referendums, gatherings, etc.); local government bodies.

26 26 Chapter 1. Territorial marketing: essence, marketing environment In fact, territory management, and therefore territorial marketing, should be carried out primarily by the population. A citizen can exercise the real right to take part in the management of the territory by acting in various social roles, for example: a resident of the territory, a participant in a non-profit organization, an owner or employee in a business, and other roles. But in modern Russian reality, the role of the citizen as a subject of territorial marketing is often passive. In reality, the population participates in the management of the territory through their representatives (deputies), as well as by taking part in elections, for example, the Head of local government, who must organize the work of local government administrations. It is the head and employees of the administration, as well as deputies of the local Council, who become the main subjects of territorial marketing, the initiators of the development of plans for the successful socio-economic development of the territory. In addition to private individuals and territorial authorities, any structures localized in the territory and interested in the successful development of the territory can become subjects of territorial marketing. Subjects of territorial marketing can be individual business entities and non-profit organizations. Subjects of territorial marketing, as a rule, are localized in the territory, are active, act in the public interest and consider the main goal of their activities to be the successful socio-economic development of the territory for comfortable living and safe conduct of commercial and non-commercial activities. But we should not forget that private individuals and non-profit organizations that are not residents of the territory, for example, communities in which people from this territory have united, may also be interested in the successful socio-economic development of the territory. Thus, the main subjects of territorial marketing are: territorial authorities and management; non-profit organizations (sports societies and federations, national communities and trade unions, etc.); commercial organizations (tour companies, airlines, hotels, leisure facilities, trade and industrial enterprises, etc.);

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A. N. Shirokov S. N. Yurkova Municipal Administration Approved by the UMO Council for Education in Management as a textbook in the specialty “State and Municipal Administration” UDC 352 (075.8)

Gavrilin I.I. “Creation of centers of financial responsibility as a vector for the development of new organizational and management solutions within the structural divisions of educational complexes” In our difficult times,

Place marketing is aimed at transforming the reputation of a territory, making it truly attractive for both individuals and commercial and non-profit organizations.

It is worth noting that this system is intended for the comprehensive improvement of a specific place, which may have the following main purposes:

• For residence.
• For economic activities, including production, investment, extraction and processing.
• Natural environment, that is, as a place for quality recreation.

This concept can be applied not only to a geographical or political region, but also to a tourist destination or city.

Goals of territorial marketing

Territorial marketing of places is aimed at successfully achieving the following key goals:

1. Formation of a new positive image, as well as improvement of the existing one. With the help of modern tools, it is possible to ensure effective growth in the prestige of a place, as well as its social and business competitiveness.
2. Realization of territorial potential.
3. Increased profitability.
4. Competent and rapid change in the regional investment climate.
5. Implementation of various social programs.
6. Ensuring a high level of territorial attractiveness for national and other external orders.
7. Stimulating the use of territorial resources.
8. Attracting intangible resources, including intellectual and labor ones.

What does territorial marketing include?

The main tools of regional marketing are:

• Use of branding.
• Active and effective promotion.
• Public relations.
• Event marketing.
• Personnel marketing.
• Advertising of infrastructure projects.

A key indicator of the effectiveness of place marketing is increasing territorial attractiveness. This kind of attractiveness can be assessed as the ratio of the growth rate of the local gross product to the country's gross product.

Place Marketing Strategies

Several effective strategies should be highlighted, in particular:

Image Marketing

This strategy is aimed at creating a positive image of the place and its public recognition and popularization. In this case, it is necessary to organize communication events that will help demonstrate the advantages of the territory to external entities, as well as show that a particular place is open to new contacts. Dissemination of information and competent propaganda will contribute to the formation of a positive image.

Attraction Marketing

In order to increase the attractiveness of the territory, various accents should be created, in particular on climatic features and geographical location, economic development, specific architecture and attractions, as well as history, medicine, tourism, entertainment and recreation. The development of characteristics characteristic of the territory will contribute to increasing the competitiveness of the region.

Infrastructure Marketing

This strategy allows you to increase the attractiveness of doing business. In this case, emphasis should be placed on a high level of market relations, and also focus on entrepreneurs. Features of marketing activities will depend on the type of business, in particular financial, scientific, construction, information, agricultural, etc.

Marketing of personnel and citizens

The strategy is aimed at improving the attractiveness of a certain location for personnel of a certain qualification, specialization and profile, as well as for various categories of citizens. To do this, it is necessary to popularize education, personal safety, employment potential, comfortable living conditions and many other needs.

Thanks to territorial marketing, it is possible in a short period of time to increase the prestige of a specific territory, as well as the attractiveness of various resources, including natural, financial, social, logistical and many others.

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