How Corporate Reputation Is Changing
Corporate Reputation. What exactly does that term mean now? The answer is changing. Reputation is more than an asset that needs to be protected amid the rise of consumerism and corporate social responsibility. Reputation is also a driver of growth if managed well. Businesses that invest in their reputations can grow sales, strengthen employee retention, and create stronger relationships with investors, among other benefits. To do that, businesses need to think differently about how they create and share their narratives online.
Reputation in the Digital Age
To understand where reputation management is headed, it’s helpful to know how it has evolved. For much of the digital age, the popularity of social media and customer ratings/review sites such as Yelp gave rise to a modern-day consumer empowerment movement that influenced how businesses perceive corporate reputation. A so-called feedback economy made companies view consumer-oriented reputation management defensively -- as in constantly reacting to ratings/reviews and online consumer activism that could either make or break a brand.
That feedback economy was not limited to consumers, either. Employees, job seekers, investors, and other stakeholders increasingly relied on social media and feedback platforms (e.g., Glassdoor) to create a 24/7 reputation loop.
In recently years, as well, the issues that shape reputation have changed dramatically.
Reputation has always been tied to corporate performance, including product performance, and the customer experience. Every business can cite their own litany of war stories concerning how they’ve managed CX lapses or, more positively, how they’ve learned from customer feedback about the nature of their experience.
But in the 2000s, reputation management has also overlapped with corporate social responsibility. Reputation isn’t just about your experience but also your values, especially the values and actions of your leadership. Your stand on social issues. Your commitment to making the world a more diverse and inclusive place to live, starting with your own business. Your actions to make the world more sustainable.
This constant rain of feedback from all stakeholders has contributed to a largely defensive stance toward reputation management – a sense that reputation is a fragile asset constantly at risk to be broken by one misstep, one regrettable tweet from a CEO, and so on. Businesses such as ours have published a great deal of content (including an entire white paper) designed to help companies manage that asset carefully.
But times are changing rapidly. Businesses are realizing that building a reputation means more than responding. It means creating a narrative and sharing proactively it through a well-conceived plan. All the issues that shape reputation, ranging from social activism to the customer experience, matter even more than ever. But businesses are getting savvier about having a voice in the public conversation. And not just in a defensive way, either. They’re more interested in creating narratives that connect reputation to growth. Here are some reasons why:
1. Businesses are responding to the velocity of change
More businesses are appreciating how well a company can gain a reputation amid fast-changing markets, consumer priorities, and technologies. Consider the rise of electric vehicles. Not long ago, EVs were considered to be an outlier product. Today more than half of potential car shoppers globally plan to make an EV their next purchase. Governmental legislation such as the Inflation Reduction Act in the United States has stimulated interest in EVs. But so has the corporate sector – in particular, one company, Tesla. Tesla practically owns the EV category. Sure, Ford and General Motors are catching up, but Tesla has built a strong competitive moat largely through reputation building with automotive industry influencers. Tesla did something else: create a narrative around EVs and sustainability. This positioned the company well as the public became increasingly concerned with the impact of consumerism on the environment. This proactive strategy has given Tesla a strong advantage.
2. The economic downturn has taken hold
For the first time since the Great Recession of 2007-09, businesses are managing their marketing and communications through an economic downturn. Global stock markets have plunged in value throughout 2022, employee layoffs are common, inflation is hampering economic growth, and businesses are lowering their earnings forecasts.
A number of businesses have learned from the pandemic and social unrest of 2020 that how they manage their marketing and communications during uncertainty has far-reaching consequences. Companies that thoughtlessly axed employees during the economic scares of 2020 have struggled to re-hire amid the Great Reshuffle. No one wants to become the poster child for how to poorly communicate and manage a layoff. The public shaming and damage to long-term recruitment and retention are too costly.
Publicly traded firms in particular need to manage their reputations and expectations with not only investors but also employees, job seekers, clients, and a number of other stakeholders amid the rise of stakeholder capitalism. As businesses adapt their communications approaches for a recessionary economy, they also need consider how they’ll balance their narrative with investors who are motivated by a company’s brand values and strategies. For instance, P&G, a company that has always valued innovation and ESG, has continued to comment on its investment in those topics even amid the downturn, an example being here. Companies that communicate strategically about their post-recovery strategies and commitment to their values are enjoying an advantage over those that remain mired in a predictable slash-and-burn designed to satisfying short-term mindsets.
How to build reputations
How might a business actually connect reputation to growth, though?
Since the dawn of time, reputation has been built by stories – stories you tell and stories that people tell about you. For the past 10, brands have ceded the storytelling to consumers. But now brands are waking up now to the power their own storytelling. They need to do it differently, though.
First, brands need to tell a powerful story with an authentic narrative at the core, emanating from the highest echelon on down, something Patagonia has mastered. That story needs to be:
- Distributed efficiently across multiple touchpoints in the digital world, ranging from your website to social media.
- Shared consistently with more audiences: investors, customers, employees, and job seekers. Inconsistencies will get called out and erode trust.
- Engaging and relevant to each audience, meaning the format should be customized, whether short-form video or a text-based annual report.
- Accessible to everyone through an inclusive and great experience.
It’s fair to ask how a business can do all that cost effectively especially during a down economy. The answer that yes, efficiently creating and sharing a narrative is not only possible but also desirable through centralized content hubs that deliver assets efficiently and cost effectively for many audiences. The content hub consists of:
- Content taxonomy – reusable assets for each audience. Businesses literally cannot afford literally to create and customize content for every audience from scratch. They need reusable assets (e.g., images, text, and video) that can be configured and structured differently as required for each audience. A taxonomy consists of both the core assets plus metadata to make it possible to easily update the core asset and share it across multiple interfaces ranging from web pages to emails to social sites – creating once and publishing everywhere.
- A repository to reuse assets at scale. At the core of the repository is headless content management system (CMS), which becomes the container for entire taxonomy. A headless CMS decouples the content from the presentation layer, which makes it easier for a brand to update and share content in nimble fashion. The headless CMS needs to be easily accessible for all the stakeholders who need the taxonomy – likely a cloud-based, highly secure intranet with a layered technical architecture.
A well-managed content hub results in an important outcome: intelligent content. The world has been bombarded by content, and businesses have contributed to content clutter. The companies that will be successful in building reputation aren’t the ones who will just add a ton of content to the existing pile. No. They will be more strategic with content creation and distribution. This intelligent content approach should mean producing better content that delivers more impact without a significant increase on their bottom line -- perhaps even saving money.
During a downturn, brands have an excellent opportunity to show their true mettle. To double down on the factors that will make them stronger when they emerge on the other side. Sharing a credible story that is distributed effectively will do that. Doing this will support long-term growth for all stakeholders.
Contact Investis Digital
Investis Digital can help you connect your reputation to growth. Our Connected Content approach is designed to help businesses amplify their content across the digital world. Contact us to learn more.