Reputation can be critical to the number of customers a brand attracts, or how keen they are to deal with an organisation in the case of unavoidable services or monopoly providers. But the impact goes well beyond that; the value of a company as a going concern can be hugely impacted by its reputation, as the intangible asset value on the balance sheets of listed companies partially reflects.
The Top Companies Reputation Index (TCRI) survey found that reputation is almost equally important whether your target market their consumers or other businesses. Asked about how they had actually acted in the past, business representatives were found to be slightly more likely to act on good reputation than consumers but, in turn, businesses were slightly less likely to act on bad reputations.
Fifty-one percent of business respondents said they had boycotted a company or brand because of a bad reputation, while 56% of consumers said the same thing. While 80% of businesses said they had sought out and done business with companies who had good reputations, the number of consumers who said the same thing was 74%.
The message, it seems, is that a company that doesn’t directly target consumers would be better off should it do something to damage its reputation than a business-to-business outfit — but both should be prepared to lose more than half their customers.
Reputation audits and surveys, where they are carried out at all, typically benchmark companies against their peers. There is also a tendency to identify specific problems (are there people who will boycott our company because of how they perceive our reputation?) and to predict future demand (will people seek us out because we have a positive reputation?) for products and services.
The TCRI shows that such surveys, whether focused on a specific company, group or industry, can identify problem areas and groups. However, it also shows that throwing advertising spend at a problem, or to try and improve perceptions, will not always work, and may not work at all in isolation. Reputation, it turns out, is a rather complex issue.