Abstract
The aim of the paper is to explain howapplication of marketing and branding principlescontributes to effective management of destinationsunder conditions of globalization. The paperemphasizes the importance of understanding oftourists’ behavior model, with special focus onimportance of destination image in process of decisionmaking on destination choice. Case of the city ofRovinj was presented as good practice example indevelopment of destination brand. In order to get theanswer to the question where BiH is located incomparison to other countries of the Western Balkansin regard to the most important tourism indicators,findings of relevant research of the World TourismOrganization and the World Economic Forum werepresented. In the last part of the paper, some of theshortcomings that usually arise in the process ofdestination management in BiH were presented, withrecommendations how they can be overcome inaccordance with the principles of destinationmarketing and branding, in order to better utilizetourism potentials in BiH.