Depending on your point of view, it may be exciting or alarming to note that the public persona of a company’s chief executive now accounts for a more significant percentage of that company’s reputation than ever before. In what’s often seen to be an increasingly fickle world, it’s exciting to anticipate the possibilities of presenting a personable leader, but it can also present challengers.
In the age of social media, it’s easy to understand why some chief executives have garnered a remarkably engaged following — and how that can be both a good and a bad thing. An example that makes this clear is that of Elon Musk, the South African-born business magnate whose tweets range from the inspirational and the harmlessly misguided to the somewhat malicious and the downright alarming. When he tweeted that he’d like to send a submarine to assist in the rescue of the boys’ soccer team trapped in a cave in Thailand, it seemed like a well-meaning, if impractical, gesture. When he went on to call one of the divers assisting in the rescue a “pedo guy” in retaliation against that diver’s dismissal of the submarine plan, eyebrows were raised.
Where his tweets began to affect his business’s bottom line, however, was when he tweeted — while en route to the airport, he later claimed — that he was thinking of taking Tesla private, and had funding “secured”. The company’s stock value quickly increased, then Musk found himself in legal trouble when it later surfaced that funding was not, in fact secured. Stock value plummeted weeks later when Musk gave a podcast interview in which he smoked marijuana with the host — and the show’s content was largely buried under headlines featuring the words “cannabis”, “weed”, and “dagga”.
In the case of his tweet about shares, it’s no surprise that information closely related to business had repercussions for Musk’s finances. But the YouTube video? It could well be that investors’ alarm related only to the business-related content shared there, but it seems more likely that a moral judgement is affecting buying choices. It’s not news that consumer behaviour is likely to be emotional and even sentimental rather than purely rational, but in an age of increasingly immediate exposure, it’s in the best interests of chief executives to manage those feelings more carefully. The social media age enables easier communication, and companies must harness this power for good — their own good, and that of their customers. So, what’s a social media-shy chief executive to do?
“Take the initiative to educate,” says Moshopyadi Hannah Heil of Reputation House. “As in, don’t expect people to understand why you’re in business.” If resources allow, she suggests, companies should ensure that they’ve invested in media tracking and even consider hiring a chief reputation officer (CRO).
“Some people might argue that that’s the job of the chief executive, that he or she is the CRO. Yes and no. Depending on the resources that a company has, it may well be worth the company’s while to have a CRO who can liaise between the external-facing people who are responsible for managing the corporate reputation of the company externally and coordinate, internally as well: as we’ve seen, the windows that shine a light into organisations are much clearer than they have been historically, when companies had solid walls. With the internet, it is not a waste of time for companies to really spend their requisite resources on empowering a key individual to understand the workings of reputation and what is necessary.”
The findings of this year’s RepTrak™ survey demonstrate that transparency is highly valued in a brand — now that we as the public are used to having information at our fingertips, we have no desire to relinquish that privilege and be kept in the dark. Happily, this runs both ways: research technologies allow companies an unprecedented ease of access to their customers’ and stakeholders’ points of view.
Reputation House advises that businesses present a clarity in their business message: that a company’s vision is outlined clearly in a way that demonstrates its aims and how it plans to achieve them. Negative reports are not the only enemy of a brand’s reputation, and neither is fake news — there’s also the sheer volume of available information to contend with. It’s easy for a brand’s reputation to become diluted by the reputation of other players in their industry, if they’re not careful to distinguish themselves with a strong identity.
A significant and recent example of this clarity of purpose comes from Nike in the US, whose decision to put their symbolic and financial support behind Colin Kaepernick, the controversial football player who has received both praise and vitriol for kneeling during the national anthem in protest against police brutality. Heil explains that Nike’s stance has served to communicate a clear message about the brand. “They’re saying, ‘This is what we support’, she says. While of course a savvy business move with profitability calculated in, they’re nonetheless aligning to the higher purpose of others. Their advertisements are speaking about their corporate brand — about something more than just the products and services they sell.”
When Kaepernick was featured in Nike’s most recent ad campaign — alongside other much-maligned sports stars such as Serena Williams and South Africa’s own Caster Semenya — the response was loud, and divided. While opponents of the Black Lives Matter movement vowed to burn their Nikes, and in many cases posted video footage of themselves doing so, Nike’s stocks and sales have increased. Shoe burnings, after all, do no damage to the company’s bottom line when the footwear has already been purchased and paid for, but the more significant point here is that Nike’s clear identification of their target market and a clear message from the brand to these young, black Americans has paid dividends. The black youth who not only understand Kaepernick’s message about police brutality but also the misrepresentation that he has experienced as a result of sharing it are Nike’s customers, and their brand loyalty has been reconfirmed thanks to a decisive, bold message.
“We don’t just talk about familiarity and transparency for the sake of it. Ultimately, the reason companies bother with this, and taking all these steps, is to impact the behaviour of consumers, so that those behaviours are to the benefit of the company or the organisation.” Heil is of the opinion that brands’ reputations don’t have to be spotless: in her years of research, she’s noted that the public has a propensity for forgiveness and forgetting when it comes to brand mishaps that cause minor damage to a company’s reputation.
Companies and organisation will always have moments in which they disappoint stakeholders, but the handling of these incidents can be cushioned by a clarity of purpose that creates understanding and even advocacy from customers. If managed well, and with a good degree of transparency, these moments can even become turning points at which customers gain a greater degree of trust in a brand. As in all relationships, communication is key, and individuals and corporations alike would be well-advised to keep talking to those who matter to them.