Corporate/Brand Image and Reputation: Just How Pivotal Today in Shaping and Sustaining Customer Value?


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The overall importance of corporate/brand image and reputation as a driver of customer behavior has been understood for decades. That said, as a component of perceived customer value, it’s more controversial, yet probably receives somewhat less detailed analysis and study, than other elements of the customer experience, such as service or product performance.

This seems to be a good time for a re-look at image and reputation, from both the inside-out and outside in. Some pundits and analysts have, for example, begun to cast doubts on the current importance of brand relevancy and aura. In support of that perspective, they cite the fact that people are becoming less interested and engaged in sharing the typical kind of image-shaping information about brands, noting:

a) there’s a greater emphasis on price today, enabling the growth of generics in a number of categories and

b) consumers are utilizing online reviews more frequently (isn’t that also a form of image and reputation-building?) to help inform their purchase decisions

That said, image and reputation still contribute mightily to perceived value and, it should also be noted, directly to sales as well. With respect to the second point, i.e. the greater impact of online reviews (in combination with other elements of brand image and reputation), in a recent blog, my colleague Gregory Yankelovich noted the correlation between the number of reviews and products sold, saying that his studies “…suggest very strongly that high product reputation, coupled with high number of customer reviews, is predictive of strong sale through number for the product.”

Though people may or may not, indeed, be doing somewhat less direct online and mobile brand-related communication, the brands themselves have found new opportunities to keep their image current and relevant. In addition to advertising, companies are also endeavoring to maintain their brand image and reputation through digital channels (like Snapchat, Ello, and Pinterest), online communities, and content delivery vehicles such as YouTube, email, and other social media.

We can take the case for financial value of brand image and reputation somewhat further. On a worldwide basis, the power of brands to contribute to consumer decision-making (outside-in) and for corporations to use brand reputation as a competitive advantage (inside-out) have been studied by groups like the World Intellectual Property Organization (WIPO). In their report from earlier this year, “Brands – Reputation and Image in the Global Marketplace”, WIPO recognized the role of brand reputation in helping consumers make choices, and also to convey the value and worth to the customer of the brand itself.

And, in an example of image and reputation’s financial impact, as reported by Nicola Scheepers of Griffin Hack, brand value consultancy Brand Finance’s Global 500 determined that Ferrari is the world’s most powerful brand. Ferrari? Yes, even at 350th place on the Brand Finance Global 500 overall list, Ferrari is definitely competing above its weight class. According to Scheepers: “The legendary Italian car maker scores highly on a variety of measures, from desirability, loyalty and consumer sentiment to visual identity, online presence, and employee satisfaction.” Top spots on global brand value go to Google, Apple, Samsung, and Microsoft.

Corporate/brand image and reputation, if impaired, can also have a downside impact. Beginning with the 1989 Exxon Valdez oil spill in Alaska, and continuing with companies like British Petroleum in the Gulf of Mexico oil rig disaster, operating dangers associated with Toyota General Motors vehicles, calamities which befell Carnival Cruise Lines and Costa Cruises, and more recently customer account breaches experienced by Target and Home Depot, these situations have evoked anger, anxiety, fear – and especially non-purchase – among consumers.

To keep these reputation threats from derailing enterprise goals – financial, cultural, growth, innovation, and otherwise – leading organizations apply various forms of preventative maintenance to protect their image. In “Lighting the Path to Success”, a report prepared by the Hay Group in 2012 to chronicle, over fifteen years of study, the how and why of the Fortune magazine’s World’s Most Admired Companies (WMAC), some of the key factors were covered. Flexibility, quick reaction, enabling of employees, efficient processes, internal collaboration and listening, and long-term focus were some of the behaviors addressed; however, specifically with respect to image, Hay has found that inside and outside management of the enterprise reputation has become the most significant factor in enabling the WMACs to outperform peers. Further, three-quarters of these companies communicate the importance of the organization’s reputation to employees on a regular basis.

As a concluding thought, I’m referencing my July, 2011 CustomerThink blog on the relationship between corporate/brand image and customer behavior: “In truth, virtually every company in every b2b and b2c industry is vulnerable to reputation attack and resulting business impact. As noted by Dr. Leslie Gaines-Ross, Chief Reputation Strategist for international public relations firm Weber Shandwick: ‘There is an increasingly critical connection between brand and service promise, corporate and brand reputation trustworthiness, the transactional experience (as delivered by people, processes, communications and culture), and downstream customer behavior. Any small ripple in reputation change (such as through a product-related issue, online rumor, executive miscue), brand performance or customer service can have a tsunami-like effect on business outcomes which may last indefinitely. This is especially true now because of the permanency provided by social media.’ *

* Afterword, from The Customer Advocate and The Customer Saboteur, Michael W. Lowenstein, ASQ Press, 2011


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