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A Focus On... Iceland

VitalStatistics

Population: 319,000
Monetary unit: króna (ISK)
Capital city: Reykjavík
Major languages: Icelandic
Major religions: Evangelical Lutheran
Ethnic composition: Icelandic 92.4%; European 6.4%, of which Polish 3.4%, Nordic 0.5%; Asian 0.7%; other 0.5%
Age breakdown: under 15, 20.9%; 15–29, 22.1%; 30–44, 20.6%; 45–59, 19.4%; 60–74, 11.2%; 75–84, 4.3%; 85 and over, 1.5%
Life expectancy: male 79.7 years; female 83.3 years
Education: Percentage of population ages 25–64 having: primary education 3%; lower secondary 33%; upper secondary 23%; postsecondary non-tertiary 11%; higher vocational 4%; university 25%; advanced degree 1%
Urban/Rural split: urban 93.1%; rural 6.9%
Income per household (USD): -
Broadband internet users (%): -

Source: Encyclopedia Britannica

Introduction

When World War II ended, Iceland was one of the poorest and least developed economies in Europe. It joined the European Economic Area in 1994, liberalised its economy, and by 2007 had transformed its fortunes, becoming one of the richest economies worldwide in per capita terms. Then in November 2007 it all came crashing down in spectacular fashion with the collapse of the financial services sector and humiliating bailouts from the IMF and several other European countries.

Today the Icelandic economy has recovered to some extent, but the PR industry remains somewhat limited. Egill Jóhannsson is the CEO of Brimborg, which imports Ford, Volvo, Mazda and Citroën cars to the country and also owns Thrifty and Dollar car rental licenses. He says: “There are some signs that the PR market is developing but for the most part it is still former journalists tapping up existing contacts to get stories placed.”

He adds: “This is probably due to the fact that we are a small country with just 320,000 inhabitants, so everyone in business and the media tend to know each other. On the positive side this makes our PR industry flexible, but it also means that friendship can be more important than professionalism.”

Media

Others believe that it is the Icelandic media which holds the PR industry back. Gustaf Gustafsson is general manager of the marketing office at tourism company Westfjords and he has worked in PR in Iceland for more than a decade. He says: “We have a problem that the media is owned by a small number of people with strong vested interests. This lack of a credible fourth estate was one of the reasons for the crash and it has been further exacerbated by the reductions in journalist numbers which has followed the crash.”

He continues: “It means that we have to be careful about the media we pick. Just getting

coverage isn’t enough in Iceland; it needs to be coverage in the few media outlets which people believe in and trust. For example, when I was head of PR at the Icelandic Cancer Society we ran a campaign on male cancer. It became the most successful health PR campaign in Iceland’s history largely because we picked one media partner – 365 - early on and worked closely only with them.”

A side effect of this is that social media take-up is growing even faster in Iceland than it is elsewhere. Jóhannsson at Brimborg reports that he uses social media extensively

"A recent success has been our campaign for the Ford Mustang show,” he says. “It began after the financial crash of 2008 when the car market was down by 95% and our marketing and PR budget was almost down to zero. By clever use of social media and direct e-mails we managed to get more than 1500 customers in one day to our Ford Mustang show. We have continued with the same approach and this year almost 5000 people showed up with thousands more watching videos and photos from the show on our website and Facebook page.”

Major Brands

Iceland's finance sector has had much work to do in recent years to restore its tarnished public image, and observers point to Landsbankinn and Arion as two banks that have done this relatively successfully.

Other than that, Icelandair retains a powerful brand

largely through PR work, Brimborg has built a profile far outstripping its actual size mostly because of its PR activities, and bread manufacturer Myllan received an award last year for providing useful information to the public about the health benefits of bread.

Agencies

There is a thriving freelance PR market, but really only four agencies of note: Cohn & Wolfe, KOM, AP almannatengsl and Athygli.

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