Inward Investment: Are Your Region's 'Priority Industry Sectors' Really All Your Priorities?

Tuesday 21 June 2016
It's standard practice for regional Investment Promotion Agencies to focus on priority industry sectors, and with very good reason. In a highly competitive global market for business investment, locations need to focus on their areas of strength and differentiate their offers, to present credible value propositions to investing companies.

But in the case of many (not all) locations, theory and good intentions are as far as this commitment to targeting and differentiation goes. In practice, far too many locations claim - unconvincingly - to specialise in everything, highlighting multiple 'priority sectors' that look much like everywhere else's (the usual sector categories are familiar to all of us: Creative and Digital Industries, Advanced Manufacturing, Biotechnology etc...).

So what's the problem here? And what can regional inward investment agencies do to really differentiate themselves and target their marketing messages?

Problem 1: Pitching for Everything...

The first problem is a tendency to 'play it safe' - to pitch for everything rather than being focused. All the time, regional inward investment teams, and their political masters, are seeing competitor regions secure inward investments across all industry sectors. And to focus on a very limited number of specialist areas is to rule your region out of the race for many of them. That takes nerve, and some explaining when your agency's performance is evaluated at the end of the year.

But it's the right thing to do, because your region won't win investments anyway where it's proposition is weak, and claiming to be good at everything only diminishes your credibility in areas where you genuinely excel.

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Problem 2: Trying to Please Everyone...

Here's another example of following the path of least resistance. Every region is home to businesses and industry organisations representing a broad range of sectors, and it takes some nerve to suggest, as a matter of policy, that a particular sector is 'not a priority'. But, again, it needs to be done.

To cite a realistic example, a small industrial town may be home to a limited 'creative' sector serving the local market - without the scale, distinctiveness, workforce strengths or lifestyle offer needed to atttract other, highly mobile companies in this sector. Meanwhile, the same location may benefit from the people, land availability and low costs required to attract companies in the manufacturing or logistics sectors. If so, those should be the areas to prioritise.

Problem 3: Following the Crowd...

The third problem is a widespread tendency to conform to standard or popular industry sector categorisations, for example those promoted by the national Investment Promotion Agency (UKTI in the UK).

Aligning with the national agency might make sense - after all, it may be an important source of investment enquiries. But the fact is that any regional inward investment agency that does marketing, especially online, is in the middle of a complex network of multiple businesses, influencers and intermediaries - not at the end of a rigid, linear pipeline with one source.

In this context, the right thing to do is to identify areas of strength and promote sectors on the basis of what make most sense to the people and business you're targeting (i.e. talking their language), not to align with any standard classifications or intermediaries, however important they might be.

Download Clarity's E-Book, The Inward Investment Marketing System: learn more about developing your winning Inward Investment Marketing Strategy.

So what's the lesson from all of this?

The lesson is that the same, sound marketing principles apply in Inward Investment Promotion as in any other area of business-to-business marketing. Region's need to identify their distinctive, niche areas of strength and align them with the identified needs of expanding businesses in the same niche areas. Don't be tempted to 'pitch for everything', 'please everyone' or focus on anything other than satisfying the needs of your target audience. To do so will simply lead to 'me too' propositions that fail to stand out from the competiton, get noticed or appeal to businesses that could, realistically, make your location their new home.


Nick Smillie
MD, Clarity Business Strategies Ltd.
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