Marketing Analiysis Bucharest

8/12/2019 Marketing Analiysis Bucharest

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Marketing analysis of a city

Case study: Bucharest



2

March 2014

CONTENT

I. Territorial diagnosis and analysis of the territorial development policy..................3

1. Relevant territory..............................................................................................................3

2. Territory identity......................................................................................... …………..…5

3. Territory image. ................................................................................................................7

4. Economic aspects and demographic information…………………………………………9

II. Marketing strategy.........................................................................................................13

1.

Attractiveness policy. ...................................................................................................... 132. Segmentation and targeting.............................................................................................. 14

3. Mix marketing and operational marketing....................................................................... 16

III. Benchmarking and recommendation............................................................................18

Benchmarking. ........................................................................................................…..…18

1. Recommendation...............................................................................................................21



3

I. TERRITORIAL DIAGNOSIS AND ANALYSIS OF THE TERRITORIAL

DEVELOPMENT POLICY

1. Relevant territory

General presentation

Area: 228 km2

Population: 1.88 million people

64 km north of the Danube

100 km south of the Oriental Carpathians

250 km west of the Black Sea

Distance to selected cities349 km - Sofia;

1162 km - Atena;

637 km - Istanbul

1343 km - Varsovia

1378 km - Praga

860 km - Budapesta

Photo source: http://alabamamaps.ua.edu/contemporarymaps/world/europe/

Editor program: CorelDRAW Graphics Suite X6



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Transport:

19 km from center of Bucharest to the Henri Coandă International Airport

226 km to the Port of Constanța at the Black Sea

65 km to Giurgiu, 62 km to Oltenita, two port cities at the Danube

main national road network node, the starting point for three motorways (A1 to Pitestiand A2 to Constanta, A3 to Ploiesti) and nine national roads

North Railway Station, the most important railway node of the national railways CFR

72 km ring road surrounding the city

subway, buses, trolleys, trams, bike lanes

Environment:

Herestrau Park and Lake 110 ha

Alexandru Ioan Cuza Park: 85 ha

Tineretului Park: 80 hectares

Carol Park: 45 ha

Circus Park: 26 ha

Cismigiu Gardens: 14 ha

Botanical Gardens: 17.5 ha

Zoo: 5.8 ha

Dambovita River 22 km long within

Bucharest Vacaresti Lake:189 ha

Baneasa Forest

Bellu cemetery:28 ha

The Village Museum: 9 ha

SOURCE: http://www.skyscrapercity.com/showthread.php?t=1242501&page=2



5

Environmental Quality

Bucharest enjoys favorable environmental conditions for a large urban concentration. The

total net area planted in Bucharest is cca.3000ha (parks, public gardens, squares, alignments and

housing complexes, bridges) which represents approximately 15% of the administrative territory.

Related area per capita is 16m2.

Land permanently covered by water is also a significant contribution to the maintenance

of environmental quality. Totaling 350 ha.

which is about 6.0% of the administrative

territory. Related area is 6.6 m2 per capita.

In the city, 53 pollution sources were

identified such as thermoelectric power plantsand various businesses. The most polluting

substances are sulfur dioxide, carbon

monoxide or carbon dioxide, dust and volatile

organic compounds.

SOURCE: Study: Air Quality in Bucharest. Center for sustainable policy

2. Territory identity

The beginnings of Bucharest are still shrouded in mystery. It is located about 60 km from the

Danube, 125 km from the Carpathians and 260 km from the Black Sea. Lost in time, placing the

city, as its name, are closely related to the legend of Bucur.

In the past it was called Fort of Dambovita. Currently, Bucharest name is first mentioned in a

document signed in 1459 by the leader Vlad Tepes, who had settled here the second seat after

Targoviste.

In 1862 it becomes the capital of Romania. Since then

undergoes constant change, being center of the art stage, culture

and mass media. Currently, the capital has the same

administrative level as a county and is divided into six sectors.

Arc de Triomphe, built between 1921-1922,



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with a height of 27 m

University of Bucharest, founded in 1864

Source: http://horeca.ro/arhiva/2010/octombrie/

Palace of Parliament,

construction started in 1983, during the

communist period, with a height of 86 m

SOURCE : http://despreromania.com/bucuresti-locatii-

turistice-istori/

Even if the historical center of Bucharest was

badly affected by the two world wars, the

earthquakes of 1940 and 1977, it resisted. We

can still see major buildings, important for the

city

SOURCE : http://www.imidoresc.ro/2013/01/26/prin-centrul-vechi

SOURCE : http://despreromania.com/

http://despreromania.com/bucuresti-locatii-turistice-istori/



http://despreromania.com/wp-content/uploads/2012/10/arcul-de-triumf.jpg







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3. Territory image.

The current city is the result of inconsistent and uneven development, that lacks a clear vision

on long term and unsupported by territorial cooperation , unsustainable and creating social

imbalances. A development that used inadequate the resources and did not use local distinctive

competences. Also that do not focused enough on increasing the quality of life, understood as the

result of competition of several factors of different nature: the natural and built environment,

socio-economic, cultural, and historical.

Consequently, today, the discontent of the citizens towards the state of the city is generalized.

The capital city performance of catalyst for the Romanian economy in the last 10 years was

much below expectations, while low competitiveness in European and global context, along with

the unfavorable reputation, ranks Bucharest among the last places on European charts

attractiveness and quality of life.

In 2011 questionnaires were applied on several target groups among citizens of the capital.

The professionals believe that the main problem of the city is this low economic activities

that use the advanced technologies. They also said that there are issues in the administrative

capacity and management of the metropolitan area. Linked to the social-community, there are

problems related to the level of education, socio-economic segregation and low civic spirit. The

most important environmental problem is related to waste management and water and air

pollution. In the field of housing, there are problems with the structure and functioning of the

new residential areas, the tendency of chaotic urban renewal.

In the field of urban development planning, the main problem is the lack of a coherent

strategy and medium-term commitments.

Adult citizens of the city have considered that the main issues are related to the level of

infrastructure of transportation equipment, the traffic deterioration of valuable elements of the

natural and built heritage, development disorganized, chaotic, poor economic development and

poor communication between administration and institutions responsible for the urban

development. In the field of housing, there are problems with the quality of housing and low

supply of social housing. They consider this lack of interest from stakeholders and responsible

persons of public institutions but also the lack of civic spirit.



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Over 200 young people aged between 20-30 years were questioned about traffic, the

environment, public administration, quality of life, housing, green spaces and socio-community.

They have reported major issues related to bad condition of existing infrastructure,

insufficient number of parking lots, but also public transportation. They believe that

environmental education of citizens is low, the proof is the systematic destruction of green areas

in favor of building.

The main problem affecting the quality of life in the city is the traffic, followed by the lack of

jobs and insecurity of green spaces in social terms. Housing problems are related to uncontrolled

expansion of residential areas by chaotic inserts, without prior study, the high price in case of

rental or housing prices. Highlighted major problem is the corruption related to public

administration, omnipresent not only in the city. They consider that there are no specialists

within the structures of local government / regional , that there is no effective communication

between citizens and decision-making bodies at the level of the town. The young people signals

that there are no jobs for young graduates, that there is a high criminality.

The average age of the respondent was 24-26 years. Concern for overall solutions regarding

city development is shown by projects to promote alternative transportation, recycling centers,

socio-economic that counters segregation, cleaning parks.

The main conclusion is that the urban development of Bucharest experienced a accentuated

dynamic, especially in the period 2000-2008dynamics reflected unevenly in "supportive territory

and influential." This development has major consequences in dynamics of the spatial plan, but

both the evolution of the capital, and the territory were influenced by it, as complex processes:

- Uncontrolled by existing and consistent application of strategic and operational planning

documents

- Untargeted by appropriate planning mechanisms and institutions

- Uncoordinated as coherent and multiannual finance from multiple sources

- Unmonitored coherent through an system of indicators

Bucharest City Hall has "diminished" constant the institution able to provide planning and

coordination of urban development instead to strengthen The Urban Planning and Metropolitan

Centre and create an economic development agency and urban development agencies of certain

areas / intervention programs.



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4. Economic aspects and demographic information

The current situation

For describing the existing situation, have been used data from the National Institute of

Statistics and Eurostat, supplemented with data from surveys and independent studies available.

Most data cover the period 2007-2010.

Pending the development of a smart (2020), the population meets the basic requirements.

People with higher education represents almost a third of the employed population of the region.

Employed population in industry, technology and knowledge services in Bucharest-Ilfov is

over three times higher than nationwide. The share of the population employed in research and

development is more than four times higher than in the country. Unemployment rates in the

region are much smaller than those in the country.

In conclusion, the Bucharest-Ilfov has a concentrated employed population in sector of

services, relatively young and well qualified, which is a key source for developing an regional

economy competitive and intelligent.

18.5

18.6

12.33.4

5.5

5.3

3.9

14.2

18.3

industry

commerce

constructions

public officials

Education and teaching

healthcare

financial, banking and

insurance services

real estate, renting and

services for enterprises

other areas



10

In terms of economic performance in 20081the Bucharest-Ilfov, with a GDP of 28,300 euros

(PPP) per capita reached 113% of the EU27 average, tying the region that includes Athens and

surpassing other capitals, for instance Lisbon.

From 1993 to 2007, Bucharest became the main pole of development and attraction for

investors. Participation of the Bucharest-Ilfov region at value added growth (GVA) has changed

substantially. In 2007 compared to 1993, the contribution of agriculture declined from 3.1% to

0.3%. Industry and construction decreased from 44% to 30.5%, while services increased from

52.9% to 69.2%.

Of the top 100 companies with the largest R & D expenditures in Romania, 39 are located in

Bucharest-Ilfov and their expenditure R & D covers 29% of the total R & D firms in the top.

However, R & D intensity is relatively low and much lower than the one of companies in

European R & D Scoreboard.

Action priorities

Based on the analysis of the territorial plan, we identify priorities for action in four

dimensions

vulnerable groups: that requires support from the community. Are represented by

poorest people, without shelter, street children, drug addicts and the elderly.

Education and professional training: children's participation in early education andadult participation in continuing education courses.

Employment: The share of young people and the elderly is declining. The categories

of this population are considered vulnerable . In this regard, active measures and

employment policies promote labor market integration of young people and "active

aging".

Wider regional competitiveness: Bucharest-Ilfov Region ranks 165 of the 262

European regions in terms of regional competitiveness. Two directions indicate an

essential role of public administration, national and local: governance, public health

policy, education, R & D and improving technological readiness and market size

increase regional.

1 According to a Eurostat report in February 2011



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Is distinguished the development peripheral of industrial areas. There is a tendency for the

conversion of industrial areas located in the central area due to increased attractiveness of these

areas for land the urban development office and commercial functions and entertainment.

It can be noticed the attractiveness northern and central area to locate the office areas in

relation to North-South transport axis and Otopeni and Baneasa airports. There are punctual

development trends of office buildings in the west (relational the Military Industrial platform and

the highway) and in the the southern zone. Development of office buildings is not correlated with

the public transport system and accessibility points of periurban space.

Clusters

The labour and human capital endowment is rather favourable and can definitely be

regarded as an asset of the Romanian clusters. Deficits were identified in tourism, in the wider

agriculture and food sector (incl. wood and wine) as well as in the glass industry. Financing

should be provided for cluster management, PR and internationalisation activities. For the

concrete projects (e.g. research projects; infrastructure, training) the clusters should seek

financial contributions from other programmes (most likely from structural funds).



12

SOURCE: http://clustero.eu/

Existing clusters in the Bucharest-Ilfov region:research, agricultural equipment

commercialization, grain commercialization, furniture, clothes, shoes and fashion, audiovisual

services, xonstruction materials, food industry, logistics and publishing



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II. MARKETING STRATEGY

Instrument of urban management, marketing of a city means its management so as to satisfy

the needs of target markets. He succeeds when citizens and the private sector are satisfied with

their communities, and the hopes and expectations of visitors and investors are met. Activities

related to the concept focuses on locations and key-functions where improvements or further

developments will have maximum impact on the target groups, providing quality urban products

at competitive prices.

Bucharest is still looking for its identity. Reported in the national brand – that is still in an

incipient phase, it can play two roles: whether as ingredient for the country brand, the capital

becoming an element included on the list of values promoted at national level, or as a landmark,

for defining and subsequently for improving the country brand. The unexploited potential must

be capitalized in the future by using urban branding and marketing steps adapted to the local

specificity.

1. Attractiveness policy.

The main interest of foreign investors in Bucharest is covered by financial investment

banking, real estate and infrastructure construction, and distribution of commercial and large

regional market justified they are addressed. In the field of industries / creative services,

Bucharest is of interest to consulting activities, design. Main benefits taken into account by

locating in Bucharest are capital status, which means near the central institutions and good

accessibility by air, rail and road. In terms of economic activities, Bucharest has no national

competitor.

Other advantages are: market of consumers with significant purchasing power, available land

in the territory of support and influence, well-trained workforce (speaking foreign language) and

relatively cheap

The base for policy of Specific resource co – construction, are creating for example more

clusters, a Technology Park in the south of the city.

The most highlighted by governance advantages of the territory are :

- perfect localization for international trade

- well organized support for businesses

- professional human resources thanks toover 10 great universities, with different profiles





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Inhabitants (children, adolescents, students, emplyers, unemployed etc):

For this category of the message must focuse on the involvement of residents in community

development projects in the city. This will take into account the following:

- Continuous consultation with community

- Engaging different groups in projects renovation / redevelopment

- Promote the city as a place of life.

The business environment will be favored by encouraging (during the branding campaign

and also based on its positive results) local investments, by raising the number of visitors

and international events that will lead to a development of the tertiary and quaternary

sectors; For the private sector, potential investors, the message refers to the opportunities

for investment and partnership with the public sector in urban operations. Constant

communication with the private sector in the phase of initiative is important for their

financing.

Tourists. The first element that the capital could rely is tourism that will be upward

encouraged, the brand shaping the urban experience of individuals and determining them

to return to the city. For visitors and tourists, the message should differentiate between

cultural tourism - those interested in urban architectural heritage, museums and cultural

events and tourism business, conferences, fairs, etc.

Public and non-governmental organizations. The message should provide the support andcooperation of the development programs.

- Interministerial cooperation is important both from the point of view of building an

integrated development strategies and to finance categories of operations.

- Participation of non-governmental organizations and professional associations is

important role they can play in community involvement in use of local labor, the

professional advice they can offer.

International agencies can fund certain categories of transactions and can also help in

promoting the brand, increasing international interest investment in Bucharest.





b) Communication

Once formulated, the brand should be promoted and communicated to target groups

identified by their specific tools and resources available. Trends for promotion are:

- through traditional media (newspapers, magazines, radio / TV), both the editorial and

advertising campaigns

- through the rankings of cities, made comparative studies of organizations and

publications in the field

- by specific events that occur in cultural activities, sports, economic fairs promoting the

city brand

- by networks under personalities ambassadors traveling overseas and visitors from the

outside that can lead a message in their places of origin

- Internet (webiste sites and social networks)

- promotional materials, objects and sold in souvenir shops at local and international events



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III. BENCHMARKING AND RECOMMENDATION

1. Benchmarking.

For positioning Bucharest in the context of regional competition, are taken into account a

number of economic indicators at the regional and urban level and is analyzed the current state

of urban and regional competitivity, according to the conclusions from different studies2.

The competitiveness is defined as the ability of cities to generate relatively high levels of

income and employment, while being exposed to external competition. Competitivity

differentiation between European cities is based on a typology of urban audit studies which takes

into account four dimensions: size, economic structure, economic performance and key factors of

regional competitiveness (innovation, entrepreneurship, human resources, connectivity)3

Resulting typology of evaluation the indicators for each dimension groups the cities in three

main categories: international centers (A), specialized poles (B) and regional poles (C).

According to urban competitiveness analysis model for the data series in 2010, Bucharest is a

capital city reinvented, alongside Budapest, Sofia, Warsaw, Prague, Bratislava, and the Baltic

capitals, entering the category A2 national capitals and metropolitan areas.4

This category of cities champions of transformation, engines of economic activities in the

new Member States, is characterized by the decrease of population, high growth rate of GDP,

high level of GDP per capita, high rate of occupancy for older people. The strengths of these

capitals are the human resources (international) innovation, entrepreneurship and connectivity

(national). There are the capitals with the fastest growth rate in Europe up to the financial crisis,

bringing a significant contribution to the overall European competitiveness.

The comparative analysis of these capitals of the Central and Eastern Europe is based on a

number of key indicators and their important economic role) is based on a series of key

indicators of regional dimension competitiveness and economic performance.

2 State of European Cities Report, EU Regional Competitiveness Index and Global Competitivity Report

3 EU Second State of European Report (2010)

4 According to the Report of Expertise Productive City - Integrated Urban Development Strategy of Bucharest and

its supportive territory and influence, stage I



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BUCHAREST SOFIA BUDAPEST PRAGUE WARSAW

Population (million) in 2012 1,88 1.29 1.72 1.24 0.78

Urban density

(population/km2) 2011

8431 1047 3307 2550 3296

Area (km2) 285 1349 525 496 641

Administrative composition 6 sectors 24 districts 23 districts 22 districts 18 districts

Unemployment rate (%) 2011 1.99 3.7 11.4 4 3.5

Average monthly salary in €

(without taxes)

383 437 462 810 832

Average price € / m2 of buying

an apartment in downtown

1521 1055 1194 4372 2466

Region / Province BUCHAREST

/ ILFOV

YUGOZAPADEN KOZEP-MAGYARORSZA PRAHA MAZOWIECKIE

Regional GDP (millions) 2011 34994 18722 48297 38672 82930

Employment in high-tech

sectors of total employment

(thousands) 2012

1055 976 1280 644 2443

Total expenses in R & D sector

(% of active population) 2011

1.99 1.25 2.35 4.6 1.38

EPO patent applications

(application nr / million) 2010

9.32 5.43 40.76 22.93 55.04

Researchers in all areas (% of

total employment) 2008

0.97 0.74 0.99 2.08 0.77

Human resources in science and

technology sector (% of active

population) 2010

43.5 40.7 42.9 59.1 44.3

Number of students in higher

education (% of population

aged 20-24) 2009

251.2 80.4 102.8 187.5 114.1

Employment rate (15-64

years,% of total)

64.3 67.6 60.3 71.5 64.4

Total nights accommodation in

hotels and similar units (no.residents and non-residents in

millions)

1.97 2.24 6.28 11.62 4.45

Total beds available in hotels

and similar

22634 36647 47389 68521 30198

*Source: Eurostat and NSI



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According to the report of regional level in 2013competitiveness is defined as the set of

"institutions, policies and factors that determine national productivity / ability of a territory to

generate high incomes and increased and better overall conditions of life for the resident

population the territory. "Competitiveness index is built based on 11 pillars that are grouped into

3 major groups: economic competitiveness, efficiency and innovation.

In this table shows the analysis results for the Bucharest-Ilfov, compared to capital region

previously analyzed the three main groups. It also indicates the ranking of the six regions and

capital position among the 262 regions RCI. The index is built based on the average scores of the

three major groups of pillars of competitiveness.

Thus, depending on the stage of development and the competitiveness of the economy,

the Bucharest-Ilfov region that ranks 165 and second to last in the list of regions below.

Region Basic

sub-index

Efficiency

sub-index

Innovation

sub-index

RCI 2013 Final rank

Scores ranks scores ranks scores ranks scores ranks

RO32 -1.356 250 0.110 113 -0.159 143 -0.309 165 4

BG41 -1.203 237 -0.550 189 -0.341 158 -0.715 208 5

HU10 -0.487 214 -0.229 153 0.312 78 -0.148 144 2

CZ00 -0.132 147 0.282 91 0.328 74 0.213 96 1PL12 -0.348 189 -0.089 134 -0.201 147 -0.180 147 3

*Source : EU Regional Competitivieness Index- RCI 2013

EU has to come out from a profound crisis and to reduce unemployment and poverty,

while performing the transition to an economy with low carbon dioxide emissions. Against this

background, the Europe 2020 strategy aims to achieve this objective by focusing on the need for

innovation, employment and social inclusion, as well as a vigorous response to the targets in

terms of environment and climate change.

Romania's position to the three main directions of the Europe 2020 strategy comprises the

following aspects:



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- Increase intelligence. Priority Area "Sustainable Growth" aims to encourage a

knowledge-based economy. The expenses in the "research and development" should

reach 3%. In 2009 it was 0.4%. Dropout rate must be below 10%.

- Sustainable growth: reducing greenhouse gas emissions by 20%, covering 20% of energy

consumption through renewable resources, increase energy efficiency by 20%

- Inclusive growth: increasing the employment rate to 70% for the EU

2. Recommendation.

A first general recommendation relates to the necessity by Bucharest Municipality to start

specialized studies based on data collected in the field and / or updated, and the information

provided by the next census. Despite the existence of several planning documents and projects

and special studies, expert reports authors and experts consulted in the focus groups -

economists, geographers, planners, architects - have considered necessary extensive studies to:

- The current structure of the local economy

- dynamics of employment and daily travel pattern

- Audit allowing updating of the List of Historical Monuments in the city

- Green-policy-change and energy

- Structuring an agency / institute municipal / metropolitan planning

The second recommendation is related to pay more attention to culture, its role in _ urban

competitivity, in citizenship education and their own continuation of identity of the city,

"between East and West".

The third is related to the use of a campaign level of "harvesting solutions" from specialists

in areas related to urban development, by using two focus group reunions

Integrated urban development strategy must take into account the competitive development

opportunities given by the high share of people with higher education in the region's population

and the high rate of employment, media and European target close to. Employed population

focused in the service sector, relatively young and well-qualified is a key resource for developing

a competitive and intelligent regional economy.

Documents

Marketing Analiysis Bucharest