For corporations and countries alike, reputational change requires knowledge, action & communication
I spoke this week at the Reputation Institute’s conference in Barcelona, Spain, where the company released its annual RepTrak survey of company and country reputations. According to 55,000 people in 15 large economies, the world’s most reputable company is BMW, and the most reputable country is Canada.
What are the keys to building strong reputations, and improving weaker ones? Here are five observations:
- Reputation is a journey. Strong, sustainable reputations are not built overnight. Since one’s reputation exists in the minds and hearts of others, influencing these perceptions starts with knowledge and requires a coherent strategy, executed consistently over time, through many channels, and in collaboration with many stakeholders.
- Research provides the roadmap. Research uncovers the drivers of public perception, and can help isolate the narratives, messages, strategies and tactics that yield the best value. Corporate reputations are driven by perceived performance, products/services, innovation, workplace, governance, citizenship and leadership. Country reputations are driven by perceptions of ‘effective government,’ including public safety (36.8% of respondents), followed closely by an ‘appealing environment’ (35.3%) and an ‘advanced economy’ (27.9%).
- The drivers of reputation vary greatly depending on the lens through which reputation is viewed. The RepTrak survey examines what drives people to buy a company’s products, to recommend the company/product, or to work for the company. The drivers of purchasing a BMW, for example, are innovation and performance, but the drivers of its reputation as an employer also include its workplace and governance.
- Beware of a gap between internal and external perceptions. In the Country RepTrak survey, for example, Russia and China have the largest gaps (31 and 33 per cent, respectively) between their countries’ self-image and the perception of the rest of the world. The importance of understanding and closing such internal/external gaps is a key theme of the Global Alliance’s Melbourne Mandate.
- Depending on your reputation and your reality, you may need communication or change. As the RI’s attached model demonstrates, the combination of a good reality and weak reputation requires better communication, but the blend of a weak reality and good reputation requires change to minimize reputational risk.
Source: Reputation Institute
How can a reputation be influenced or changed? The key to changing reputations often involves looking at the drivers behindthe reputation. For example:
- Government reputation: The drivers of a government’s reputation are ‘perceived safety’ and ‘international participation.’ That’s why Colombia’s tourism brand campaign uses the tagline ‘The only risk is wanting to stay’ (although highlighting a negative in one’s slogan is itself a risk). The finding on international participation is a warning to nations perceived as isolated within the international community, and reinforces the growing importance of public diplomacy.
- Environmental reputation: The drivers of an ‘appealing environment’ are ‘friendly and welcoming people’ and an ‘appealing lifestyle.’ In this regard, smart custodians of country brands focus not just on external marketing, but also on developing and training the nation’s tourism workers and strengthening its tourism infrastructure. This has been a region-wide focus of the Caribbean Tourism Organization.
- Economic reputation: The big drivers of economic perceptions are ‘high-quality products and services,’ and an ‘attractive culture.’ This is a particular preoccupation in Spain today after the devastating European debt crisis, something I learned from various interviews with the Spanish media. That’s why Spain is fighting back through communication, and highlighting the nation’s long list of global companies (e.g., Santander) and brands (e.g., Zara, Mango). It’s also why the governments of Spain and Madrid lent their support to Spain’s successful bid for the Global Alliance’s 2014 World Public Relations Forum.
What are the key takeaways for communicators and marketers?
First, reputation has an unquestionable, measurable economic value. The RepTrak study shows high correlations between reputation and revenue, and (in the case of countries) between a poor reputation and a higher risk premium on the nation’s debt.
Second, reputations are not built through marketing communication alone. They flow from public relations in its truest sense: going beyond words with concrete actions to improve relationships, and change the organization’s reality.
How is your organization organized for success on the reputation journey?