1. 4°International Colloquium on
Place Brand Management
The role of network contracts in place
brand management.
Current usage and future possibilities of
this new Italian legislative instrument
Aureli Selena - Forlani Fabio
selena.aureli@unibo.it; fabio.forlani@uniurb.it
La Salle (AO) – 06/09/2013

2. The network contract
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It is a new legal form of inter-firm cooperation in Italy (introduced in April 2009)
which represents a form of strategic alliance which formally links different
organizations in the long term.
Main advantages:
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easy to sign and flexible instrument (i.e. no pre-defined goal like in franchising or other
contracts; legislation defines very few aspects then nodes freely chose to create strong or
loose collaborative links, they can freely regulate entrance and exit of single nodes; they
freely decide for creating or not a mutual fund and if fund’s stakes are identical or not)
aggregates organizations around a common scope and activities to accomplish which
have to be indicated in the contract (vision and plans should be clearly defined)
maintains single nodes’ autonomy
organized around a common entity (i.e. a Board)
Now there are almost 700 contracts involving about 3500 organizations
(sole proprietorship, partnership, no-profit, association, consortium)
(Unioncamere, 2013).
4°International Colloquium on Place Brand Management:
Strategic Marketing of Cities, Regions and Nations
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3. Agenda
1. Objectives and background of the study
2. Literature review
3. Methodology
4. Findings from empirical analysis
5. Concluding remarks
4°International Colloquium on Place Brand Management:
Strategic Marketing of Cities, Regions and Nations
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4. Background
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Italy is divided into many fragmented tourist territorial
systems (Rispoli and Tamma, 1996; Pencarelli and Forlani, 2002; Sciarelli, 2007)
Territorial brands are inadequately managed (i.e. too
many actors, no coordination, nor integration) (Pencarelli,
2009)
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Travel destinations in Italy
competitiveness (Banca d’Italia, 2013)
lack
4°International Colloquium on Place Brand Management:
Strategic Marketing of Cities, Regions and Nations
international
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5. Research Questions
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Two main R. Q. :
a) which contribution can formal private alliances (the
network contract) offer to create coordinated
territorial tourism systems?
b) do networks’ activities contribute to sustain existing
territorial brands of the area in which businesses
are located?
4°International Colloquium on Place Brand Management:
Strategic Marketing of Cities, Regions and Nations
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6. Objectives
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Objectives a):
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Aims, structure and governance of the network
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Characteristics of networks' nodes
network’s links with other local actors
Objectives b):
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Creation and usage of networks’ brands
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Link with territorial brands
4°International Colloquium on Place Brand Management:
Strategic Marketing of Cities, Regions and Nations
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7. Literature review:
networking
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Networking has been studied recurring to resource
dependence theory, game theory, transaction cost economics,
network approach etc. (Beritelli, 2011; Maggioni et al., 2012).
All forms of cooperation should be characterized by four key
conditions which make interactions working (Pansiri, 2008; Holtbrügge,
2004)
:
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compatibility: cultural compatibility of members (which can be facilitated by
having the same historical and strategic grounds) and compatibility of products
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capability: members should have complementary resources, skills and
knowledge (to create synergies) and being able to coordinate them;
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commitment: members should commit resources (tangible and intangible) and
make long term investments;
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control: formal and/or informal control mechanisms to sustain trust, avoid freeriding behaviors.
4°International Colloquium on Place Brand Management:
Strategic Marketing of Cities, Regions and Nations
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8. Literature review:
Tourism
Companies working in tourism should be considered within
the existing complex tourism systems (Rispoli and Tamma, 1995; Pencarelli
and Forlani, 2002; Bonetti et al, 2006; Sciarelli, 2007):
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the supply system of tourism services (network of
operators). This system may be recognised or
unrecognised, intentional or non intentional, formal or
informal
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the system of the geographical area (municipalities,
districts, provinces, regions, etc.)
Both systems might be associated to a brand used to give
tangible expression of system’s identity
4°International Colloquium on Place Brand Management:
Strategic Marketing of Cities, Regions and Nations
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9. Literature review:
the role of network brands
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The brand of the supply system of tourism services
usually represents the catalyzing element of all actors
involved in the supply system (Lemmetyinen and Go, 2008)
Success of brands referring to tourism systems requires
following conditions (Betti et al., 2009):
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a cultural and value system and a combination of graphic features
which recall the cultural identity (brand identity);
a mechanism for the selection of structural elements which make it
possible to draw the boundaries of the system and a control
mechanism allowing the adjustment of the system;
a system of outputs (application of the brand): external
communication flows and products (experiences, services, goods)
4°International Colloquium on Place Brand Management:
Strategic Marketing of Cities, Regions and Nations
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10. Literature review:
the role of place brands
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The network brand should be consonant with individual brands of
single tourist organizations (nodes) and with that of the
territory/destination in which they are established
When there is no fit, image of the destination could be negatively
affected -> need for coordination and monitoring (Balakrishanan et al., 2011)
But there are several critical factors related to the management of
destination brands (Pastore and Bonetti,2006; Balakrishnan, 2009):
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Problems in defining precise territorial boundaries
Difficulty in identifying who should plan/govern the destination brand
Presence of multiple stakeholders with different objectives and characteristics
Existence of consolidated geographical and historical brands
Coexistence of different products and services under the same brand
4°International Colloquium on Place Brand Management:
Strategic Marketing of Cities, Regions and Nations
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11. Literature review:
The importance of
brands consonance
private subjects
Brand of
Product Y
Brand of
Product X
Brand of
Product Z
public subjects
(tourist experience)
(tourist experience)
(tourist experience)
Brand
Of Tourism System
or Network
Brand
Of Tourism System or
Network
Brand
of Local
governments
Brand of Territory
Brand of
Private
Organizations
4°International Colloquium on Place Brand Management:
Strategic Marketing of Cities, Regions and Nations
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12. Methodology
- explorative research
- two phases: (1) quality-quantitative & (2) in-depth qualitative
analysis (case studies)
(1) it attempts to provide a descriptive analysis of current network
contracts in Italy regarding the tourism sector (source: Italian
Chambers of Commerce)
(2) Selected case studies (6) have been investigated through direct
interviews to understand networks’ characteristics and brand
management. Topics discussed with informants:
- motivations for networking
- network structure (number and type of nodes) and functioning
- network brand (investment and usage)
- link with the territorial brand
4°International Colloquium on Place Brand Management:
Strategic Marketing of Cities, Regions and Nations
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13. Findings for Italy
- Network contract is new to the tourism sectors, but its
usage is increasing:
In 2009: 0
In 2010: 0
In 2011: 7
In 2012: 14
- Different types of nodes: hotels (& other accommodations),
tour operators, farms, beach establishments, wine
producers, restaurants, aquatic parks, etc.
- Existing 21 network contracts involve mainly very small
businesses
- Average number of nodes : 12
- Nodes mainly localized in the same Province or even the
same City
4°International Colloquium on Place Brand Management:
Strategic Marketing of Cities, Regions and Nations
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14. Findings from case studies
1) Network contracts are used to create tourism systems:
- networks composed by small businesses (up to 85 nodes), localized
in the same area, offering similar or integrable products
(complementarity)
- all characterized by the presence of a mutual fund (commitment), a
coordinator (common body and its President), formal and informal
rules (control mechanisms)
- with different objectives: increasing bargain power (with public
agencies, service providers, etc.), promotion of the destination,
commercialization of products (a single service or a bundle of
services)
- characterized by openness and willingness to collaborate with other
networks (culture of dialogue and collaboration)
4°International Colloquium on Place Brand Management:
Strategic Marketing of Cities, Regions and Nations

15. Findings from case studies
2) Network contracts impact on the territorial system:
- improve discourse among actors (of all types and all
sectors) located in the same territory and sense of
belonging to the territory (reduced complexity and
networks operating in absence of public
governance)
- favor creation of touristic clusters
- improve nodes/entrepreneurs’ awareness about the
benefits of being associated to a territory with a
positive perceived image
4°International Colloquium on Place Brand Management:
Strategic Marketing of Cities, Regions and Nations
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16. Findings from case studies
3) Different usage of the network brand and links of the network
with existing territorial brands:
- creation of network brands do not always correspond to high
investments (registered trademark, regulation)
- internal consonance (network’s name, graphic logo, website) is
almost always present
- but single nodes do not recall network brand in their websites
- all networks are strongly related to the territory with only one
exception (rete Core composed by service firms)
- in two cases networks refer to one single territorial brand, while in
other two cases two territorial brands are considered and combined
in the network brand management; scarce uniqueness of the place
brand used identifies networks of firms located in different territories
previously not connected
4°International Colloquium on Place Brand Management:
Strategic Marketing of Cities, Regions and Nations

17. Case studies
2
2
2
Internal coherence
of network brand
Relevance network brand
3
Relevance network brand
3
Relevance network brand
3
Internal coherence
of network brand
Uniqueness of
place brand
1
Uniqueness of
place brand
1
Internal coherence
of network brand
0
0
0
Firms' reference
to network brand
Firms' reference
to network brand
Consonance network brand
– place brand
Uniqueness of
place brand
1
Consonance network brand
– place brand
Rete imprese balneari Viareggio
Firms' reference
to network brand
Consonance network brand
– place brand
Rete Apulia Experience
Illasi Valley
Relevance network brand
3
2
Internal coherence
of network brand
1
Rete litorale pisano incoming
2
2
Uniqueness of
place brand
Internal coherence
of network brand
0
Firms' reference
to network brand
Relevance network brand
3
Relevance network brand
3
1
Uniqueness of
place brand
Internal coherence
of network brand
Firms' reference
to network brand
Rete Core Firenze
Uniqueness of
place brand
0
0
Consonance network brand
– place brand
1
Consonance network brand
– place brand
Firms' reference
to network brand
Rete imprese delle Marine del Parco
4°International Colloquium on Place Brand Management:
Strategic Marketing of Cities, Regions and Nations
Consonance network brand
– place brand

18. Concluding remarks
- network contracts represent a practical (flexible, not
bureaucratic) instrument for tourism micro enterprises to
engage collaboration at the local level (its adoption will
increase)
- collaborative culture become more diffused and new
ideas/projects (bundle of services) to attract travelers are
implemented
- in several cases networks aim to sustain the attractiveness and
development of the local territory (while making business) or
even becoming the destination manager
- branding is a key activity: networks invest in both network brand
and place brand as they are strong catalyzer, however the
challenge is to find the perfect fit between network brand, place
brand and single nodes’ brand

19. Concluding remarks
Limitations & Future research
- additional case studies are in progress
- other stakeholders’ perceptions (i.e. public agencies
and travelers) about network and place brands should
be investigated
- networks’ effectiveness in terms of performance
4°International Colloquium on Place Brand Management:
Strategic Marketing of Cities, Regions and Nations
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