1. The goal of reputation is not to be liked, but rather to enhance perceived value versus competitors
2. The foundation of a good reputation is an organizational culture that recognizes that financial results are a proxy for doing other things right and rewards and promotes people accordingly
3. Reputations cannot be controlled, but the best way to manage reputation is by controlling the things that can be controlled (brand attributes, symbols, associations, identity, consistent marketing and communications messaging, and organizational engagement)
4. When the brand symbols, attributes and associations resonate with target stakeholder, there is differentiation in perceived value, which in turn builds reputation
5. Brands and reputation are perceived within a context of competitive offerings; to the extent that the brand differentiates, there is increased reputation advantage
6. When stakeholders resonate with the organization’s attributes, the perceptions become dominant and perceived value is enhanced
7. Branding raises expectations of performance. Reputation is enhanced when the consistency and continuing of performance behaviors are equal or better than the communicated value
8. A positive reputation over time creates inertia in perceived value--the so-called “halo-effect”
9. Social media are about “me-ness”; organizations must become part of the conversation to continue to build their brands and reputation
10. Corporate Social Responsibility only builds reputation when both the CSR program is consistent with the attributes of the organization and the program is important to stakeholders
Tuesday, July 21, 2009
Friday, June 26, 2009
The US Chamber is Wasting its Money
The US Chamber of Commerce is planning a mega campaign aimed at reselling capitalism to the US public. They want people to recognize that regardless of all of the problems we have had, our capitalisitc system is still the best there is.
What? I didn't realize that people in the US were turning away from capitalism. This must be a bunch of Chamber people who really believe that we are headed toward socialism and that the public must be warned. Is the Chamber now an arm of the right-wing Republican party?
This is the most ridiculous waste of money one can imagine. The issue is not about capitalism, but rather about abuse of trust. We have become warry of the Madoffs and Sanfords and Thains, as well as the AIGs of the world. We have seen great companies go down the tubes, led by CEOs who seemed to be unable to grasp changes in the marketplace. While many people may be questioning whether "greed is good", that is a far cry from questioning capitalism.
One of the biggest problems US business has had has been its inability to understand the market dynamics and changes in perceptions among their consumers. The Chamber is showing that it is a leader in this tone-deaf business activity.
This reminds me of the ill-fated attempt under Pres. Bush to sell the "virtues of the US" to the Middle East through a PR campaign. The problem in the Middle East is that they are tired of foreign governments (UK and US in particular) in their region and biased toward Isreal. Regardless of whether or not we agree with those assessments, we must understand them. Bush showed that he did not understand them. He assumed that they didn't like our values and so we had to sell them. Such stupidity!
This is not bad brand and reputation management, this is bad business strategy. The inability to fully understand the needs and interests in the market is a kiss of death to business. Businesses move toward the wrong targets.
The Chamber is demonstrating that it is an organization more interested in touting political ideology that leading to the restitution of trust in business. If they were concerned about the latter, they would be focused on their members and the untrustworthy behaviors many have shown rather than assuming we do not understand them. When someone says: "you don't understand me; trust me", it is time to assume that they don't get it and are not worth the time.
What? I didn't realize that people in the US were turning away from capitalism. This must be a bunch of Chamber people who really believe that we are headed toward socialism and that the public must be warned. Is the Chamber now an arm of the right-wing Republican party?
This is the most ridiculous waste of money one can imagine. The issue is not about capitalism, but rather about abuse of trust. We have become warry of the Madoffs and Sanfords and Thains, as well as the AIGs of the world. We have seen great companies go down the tubes, led by CEOs who seemed to be unable to grasp changes in the marketplace. While many people may be questioning whether "greed is good", that is a far cry from questioning capitalism.
One of the biggest problems US business has had has been its inability to understand the market dynamics and changes in perceptions among their consumers. The Chamber is showing that it is a leader in this tone-deaf business activity.
This reminds me of the ill-fated attempt under Pres. Bush to sell the "virtues of the US" to the Middle East through a PR campaign. The problem in the Middle East is that they are tired of foreign governments (UK and US in particular) in their region and biased toward Isreal. Regardless of whether or not we agree with those assessments, we must understand them. Bush showed that he did not understand them. He assumed that they didn't like our values and so we had to sell them. Such stupidity!
This is not bad brand and reputation management, this is bad business strategy. The inability to fully understand the needs and interests in the market is a kiss of death to business. Businesses move toward the wrong targets.
The Chamber is demonstrating that it is an organization more interested in touting political ideology that leading to the restitution of trust in business. If they were concerned about the latter, they would be focused on their members and the untrustworthy behaviors many have shown rather than assuming we do not understand them. When someone says: "you don't understand me; trust me", it is time to assume that they don't get it and are not worth the time.
Tuesday, June 23, 2009
Are We Entering a Time of Information Socialism?
There has been so much talk about socialism in the past year. The concept of socialism is typically related to economics. However, the most relevant type of socialism seems to be in the area of information. Except for a new piece in Wired Magazine, I haven't seem much about it.
Think about what has happened to information since the advent of social media. Information that was controlled by large companies seems to be breaking down. Social media, including blogs, microblogs and the like are putting information flow in the hands of the people, and with that intelligence is moving from the center to the fringes. We always thought of a networked society as being like an atom, with a core. However, we are evolving to more and more networks in which there is no center core. Networks simply evolve and beget new networks. Information and intelligence is shared within the network. If companies want to introduce ideas or brands, they are increasingly attempting to find ways to participate in the network. Companies are not the owners of the networks, nor do they control information flow. They are equals with others in the network.
I have noted that Facebook and Twitter are examples of the "me-ness" of society. We have always thought that technology was creating these social networks, but I am starting to think that technology is following the social and market dynamics. The founders of the new social media are part of the generation that is self-involved and more interested in what they are others like them have to say than they are in what some so-called authority has to tell them.
Like economic socialism, then, social media are creating a distribution of information (wealth). While it may not be the government taking control, as in economic socialism, there is a loss of control by corporations, owners and the wealthy. Wealth, which was centered amongst a few families a few generations ago, has been distributed as well--not withstanding the current economic collapse. The new wealthy, and there are many of them, are creators of information sources (Facebook, MySpace, Twitter, Flikr, Digg, etc.).
It is a curious phenomenon. Perhaps we need to rethink the concept of socialism? Does anyone have any thoughts on this--it's really interesting.
Think about what has happened to information since the advent of social media. Information that was controlled by large companies seems to be breaking down. Social media, including blogs, microblogs and the like are putting information flow in the hands of the people, and with that intelligence is moving from the center to the fringes. We always thought of a networked society as being like an atom, with a core. However, we are evolving to more and more networks in which there is no center core. Networks simply evolve and beget new networks. Information and intelligence is shared within the network. If companies want to introduce ideas or brands, they are increasingly attempting to find ways to participate in the network. Companies are not the owners of the networks, nor do they control information flow. They are equals with others in the network.
I have noted that Facebook and Twitter are examples of the "me-ness" of society. We have always thought that technology was creating these social networks, but I am starting to think that technology is following the social and market dynamics. The founders of the new social media are part of the generation that is self-involved and more interested in what they are others like them have to say than they are in what some so-called authority has to tell them.
Like economic socialism, then, social media are creating a distribution of information (wealth). While it may not be the government taking control, as in economic socialism, there is a loss of control by corporations, owners and the wealthy. Wealth, which was centered amongst a few families a few generations ago, has been distributed as well--not withstanding the current economic collapse. The new wealthy, and there are many of them, are creators of information sources (Facebook, MySpace, Twitter, Flikr, Digg, etc.).
It is a curious phenomenon. Perhaps we need to rethink the concept of socialism? Does anyone have any thoughts on this--it's really interesting.
Thursday, June 4, 2009
Change is Hard to Accept
There is a famous quote from Baslo that says that "Half of the world's misery comes from ignorance. The other half comes from intelligence." This quote reminds me of the one about the quality of advertising attributed to John Wanamaker, who said that "half of my advertising works; the problem is I do not know which half".
The difference between pessimists and optimists has always been this view of the glass half full or half empty. So it is with the consternation over youth and their focus on social media. A new book by Mark Bauerlein called "The Dumbest Generation" is the equivalent of the glass half empty. Bauerlein, not surprisingly, is a professor of English at Emory University, who just cannot imagine that young people can have any intelligence if they are not reading books but are focused on technology and social media. He bemoans the fact that social media make young people think that they are the "center of the universe" and cautions them to wake up quickly before the business world snaps them into reality.
It is so difficult for those like Bauerlein to accept the fact that intelligence can come from different sources and that society changes. At the time of the invention of the printing press, the Church warned that society would crumble if there was no long a control over literacy and the production of text. When the TV was invented, critics warned that we had created a virtual wasteland for our youth. So it goes now with the Internet. The same cries come from the self-appointed keepers of the keys to the proper life.
The fact is that social media do put the user at the center of the universe. It is not companies who will snap young people into submission, but rather it is the other way around. Young people and social media are forcing companies to open up, to become more transparent. Marketing is no longer about touting features, but rather about cocreating with customers who are the acknoweledged sources of intelligence about the brand because they use it. People no longer simply see value in brands but look for value in what things can do for them. Industries are being customer driven and that same time that the technology is reinforcing this societal transformation.
Bauerlein writes as if the whole society were reading books until this young generation came along. Only about 10-15 percent of the US population buys books. We are not and have not been a reading society. I agree that this is a shame--I love a good book, but that's me.
Young people may not be reading books, but they are getting information. It just happens to be filtered to fit their needs and interests. Humans have always had seletive attention; now we have the media to fit our selective interests.
We can moan and moan, but there is no turning back. Yes we need to figure out how to run a democracy without a literate society, but this was a concern at the time the Founding Fathers drafted the Constitution. The real reason for the Electoral College was to make certain that the educated could save the country from a mistake by the uneducated classes who were never trusted to make smart choices. The Founders may have been brilliant and ahead of their time on democracy, but they also were aristocratic and intellectual in their thinking about themselves versus the rest of society.
Don't get me wrong, I don't like people I think are stupid making decisions that will affect my life, but stupidity is in the eye of the beholder. I'm sure that there are many people who would love to take the vote away from me because my views might change their lives in undesirable ways. My views haven't changed because of technology. I have thought for years that we are a society that is dumbing down. We live in a far different world than existed prior to the Internet. We have so mcuh more much information and too many choices, and that makes life hard--we have to be selective and manage ourselves. It was a simpler world when a few fed information to the many; today the many are sharing information with one another. The few need to join in or they will become superfluous--look at what has happened to newspapers already.
We are in the midst of a social-economic-politcal transformation that is being spurred on by technology. It has far reaching implications for us, and many of these changes are yet to be realized. The printing press changed society forever, bringing democracy and destroying feudal rule. The Internet is every bit as powerful a change agent as the printing press and we are just at the beginning of these changes. People are creating their own news services--we already have YouTube, which is the largest TV network in the world.
We can write about how stupid kids are--this has been a theme throughout history--and warn them that they are on the wrong path due to their reliance on "newfangled gadgets", but that will not reverse the course we are on. Perhaps people like Bauerlein should attempt to understand the value young people see in these social media and how he might provide content that would be of interest. The days of someone self-appointed as the purveyor of truth, the news, etc. is over.
The difference between pessimists and optimists has always been this view of the glass half full or half empty. So it is with the consternation over youth and their focus on social media. A new book by Mark Bauerlein called "The Dumbest Generation" is the equivalent of the glass half empty. Bauerlein, not surprisingly, is a professor of English at Emory University, who just cannot imagine that young people can have any intelligence if they are not reading books but are focused on technology and social media. He bemoans the fact that social media make young people think that they are the "center of the universe" and cautions them to wake up quickly before the business world snaps them into reality.
It is so difficult for those like Bauerlein to accept the fact that intelligence can come from different sources and that society changes. At the time of the invention of the printing press, the Church warned that society would crumble if there was no long a control over literacy and the production of text. When the TV was invented, critics warned that we had created a virtual wasteland for our youth. So it goes now with the Internet. The same cries come from the self-appointed keepers of the keys to the proper life.
The fact is that social media do put the user at the center of the universe. It is not companies who will snap young people into submission, but rather it is the other way around. Young people and social media are forcing companies to open up, to become more transparent. Marketing is no longer about touting features, but rather about cocreating with customers who are the acknoweledged sources of intelligence about the brand because they use it. People no longer simply see value in brands but look for value in what things can do for them. Industries are being customer driven and that same time that the technology is reinforcing this societal transformation.
Bauerlein writes as if the whole society were reading books until this young generation came along. Only about 10-15 percent of the US population buys books. We are not and have not been a reading society. I agree that this is a shame--I love a good book, but that's me.
Young people may not be reading books, but they are getting information. It just happens to be filtered to fit their needs and interests. Humans have always had seletive attention; now we have the media to fit our selective interests.
We can moan and moan, but there is no turning back. Yes we need to figure out how to run a democracy without a literate society, but this was a concern at the time the Founding Fathers drafted the Constitution. The real reason for the Electoral College was to make certain that the educated could save the country from a mistake by the uneducated classes who were never trusted to make smart choices. The Founders may have been brilliant and ahead of their time on democracy, but they also were aristocratic and intellectual in their thinking about themselves versus the rest of society.
Don't get me wrong, I don't like people I think are stupid making decisions that will affect my life, but stupidity is in the eye of the beholder. I'm sure that there are many people who would love to take the vote away from me because my views might change their lives in undesirable ways. My views haven't changed because of technology. I have thought for years that we are a society that is dumbing down. We live in a far different world than existed prior to the Internet. We have so mcuh more much information and too many choices, and that makes life hard--we have to be selective and manage ourselves. It was a simpler world when a few fed information to the many; today the many are sharing information with one another. The few need to join in or they will become superfluous--look at what has happened to newspapers already.
We are in the midst of a social-economic-politcal transformation that is being spurred on by technology. It has far reaching implications for us, and many of these changes are yet to be realized. The printing press changed society forever, bringing democracy and destroying feudal rule. The Internet is every bit as powerful a change agent as the printing press and we are just at the beginning of these changes. People are creating their own news services--we already have YouTube, which is the largest TV network in the world.
We can write about how stupid kids are--this has been a theme throughout history--and warn them that they are on the wrong path due to their reliance on "newfangled gadgets", but that will not reverse the course we are on. Perhaps people like Bauerlein should attempt to understand the value young people see in these social media and how he might provide content that would be of interest. The days of someone self-appointed as the purveyor of truth, the news, etc. is over.
Wednesday, May 27, 2009
Can and Will Communicators Reinvent Themselves for Web 2.0?
I was a panelist at a Conference Board program in New York hosted by the reputation and issues monitoring web company, DNA13. The topic was corporate communications and Web 2.0. I spoke about brand and reputation management while fellow panelists, Peter Debreceny focused on employee engagement, and Chris Johnson talked about monitoring software to track on-line discussions and issues. We agreed that social media are creating two major trends for corporate communications: 1) the need to reset the value proposition of the function from messages to relationships (complements to Jim Grunig for pushing that concept for years!!) and 2) that the traditional barriers between marketing and communications are breaking down, creating new challenges to those without good business acumen and training.
The world is all atwitter—sorry about the bad pun!—about how new social media are changing our society and impacting how we dialog with internal and external stakeholders. Social media are evidence of the increasing “me-ness” of society. Twitter, Facebook, etc. are all about the individual at the center of the “universe”. In the era of mass media, corporations were the center—they controlled the information and its dissemination. Today, people are gathering news, sharing information about brands and companies, and creating communities of common interest. I heard one young woman recently state that if the news is important enough, it will find her. Newspapers will continue to die. But, people still want information. Where they get and who they trust for that information has changed. Recommendations from friends and on-line news are now the two most trusted sources of information in the U.S. We also are in a world in which employees are twice as likely to believe a colleague as the CEO.
I’ve heard a lot of talk from communicators, but I’m not sure there has been much real change in mindset. The conversations at communications conferences still seem to center around media relations, dealing with key opinion leaders, getting the CEO’s message out, etc. It’s hard for a profession that has historically hired former journalists, been the CEOs messenger, and valued media contact-lists to change. Will it? Can it? Those are the critical questions.
The world is all atwitter—sorry about the bad pun!—about how new social media are changing our society and impacting how we dialog with internal and external stakeholders. Social media are evidence of the increasing “me-ness” of society. Twitter, Facebook, etc. are all about the individual at the center of the “universe”. In the era of mass media, corporations were the center—they controlled the information and its dissemination. Today, people are gathering news, sharing information about brands and companies, and creating communities of common interest. I heard one young woman recently state that if the news is important enough, it will find her. Newspapers will continue to die. But, people still want information. Where they get and who they trust for that information has changed. Recommendations from friends and on-line news are now the two most trusted sources of information in the U.S. We also are in a world in which employees are twice as likely to believe a colleague as the CEO.
I’ve heard a lot of talk from communicators, but I’m not sure there has been much real change in mindset. The conversations at communications conferences still seem to center around media relations, dealing with key opinion leaders, getting the CEO’s message out, etc. It’s hard for a profession that has historically hired former journalists, been the CEOs messenger, and valued media contact-lists to change. Will it? Can it? Those are the critical questions.
Saturday, May 16, 2009
Is the Demise of Newspapers Bad for Reputation Management?
I spoke at a Conference Board program in New York this past week. The topic was about corporate communications at Web 2.0. There was a lot of talk from the participants about the demise of newspapers and what will happen when there is not an editorial filter on ideas so that "quality" wins out over quantity.
The newspaper business model has been broken for a long time. When I was in graduate school--a long time ago!!--we did case studies on the newspaper business and we could not figure out why the companies maintained printing presses and delivery trucks. Their core competence is news gathering and reporting, not production. But, their model hasn't changed and now with the decline in advertising, newspapers are having a tough time surviving.
Against this concern about the demise of newspapers was a quote from one young woman who said "if the news is important enough, it will find me".
Newspapers came into being because people wanted information about things that affected their lives. Because of the economies of scale in gathering and distributing the news, it only made sense for a few large companies to dominate the news business. Few others could afford it. The Internet has changed that model. We have millions of bloggers and microbloggers (Twitter as an example) who are gathering news and disseminating it instantly and for free. The young woman is right, the news is finding her.
At the same time, I can understand the concern over whether of not the information out there in cyberspace is of the highest quality. We are in a transitional phase right now. It is being fueled by a number of factors: the demise of newspapers, the rise of blogging, and the increasing importance people place on connecting and hearing from "people like me". We are finding the news--or it is finding us. It is news from people we trust because they think like us. Not all of it is on the Internet. Some of it is on Fox News, Air America, and other politically-based or politically-biased news sources. But, long ago David Brinkley defined bias as anything someone doesn't agree with.
So, people are comining together and becoming each other's news source, brand guidance, etc. It is a transition to a society where the individual is in the center, not the news media organization.
Will this impact reputation? Of course it will. But, the same basic tenets of good reputation management will hold. We cannot talk at people, but we must dialog with them; we need to be real and transparent; we need to be honest, not just talk about it; and we need to be more concerned with the value proposition of those we want to influence than in what we want them to believe. If we focus on authenticity and transparency, we will continue to have good reputations regardless of what happens technologically.
The newspaper business model has been broken for a long time. When I was in graduate school--a long time ago!!--we did case studies on the newspaper business and we could not figure out why the companies maintained printing presses and delivery trucks. Their core competence is news gathering and reporting, not production. But, their model hasn't changed and now with the decline in advertising, newspapers are having a tough time surviving.
Against this concern about the demise of newspapers was a quote from one young woman who said "if the news is important enough, it will find me".
Newspapers came into being because people wanted information about things that affected their lives. Because of the economies of scale in gathering and distributing the news, it only made sense for a few large companies to dominate the news business. Few others could afford it. The Internet has changed that model. We have millions of bloggers and microbloggers (Twitter as an example) who are gathering news and disseminating it instantly and for free. The young woman is right, the news is finding her.
At the same time, I can understand the concern over whether of not the information out there in cyberspace is of the highest quality. We are in a transitional phase right now. It is being fueled by a number of factors: the demise of newspapers, the rise of blogging, and the increasing importance people place on connecting and hearing from "people like me". We are finding the news--or it is finding us. It is news from people we trust because they think like us. Not all of it is on the Internet. Some of it is on Fox News, Air America, and other politically-based or politically-biased news sources. But, long ago David Brinkley defined bias as anything someone doesn't agree with.
So, people are comining together and becoming each other's news source, brand guidance, etc. It is a transition to a society where the individual is in the center, not the news media organization.
Will this impact reputation? Of course it will. But, the same basic tenets of good reputation management will hold. We cannot talk at people, but we must dialog with them; we need to be real and transparent; we need to be honest, not just talk about it; and we need to be more concerned with the value proposition of those we want to influence than in what we want them to believe. If we focus on authenticity and transparency, we will continue to have good reputations regardless of what happens technologically.
Monday, May 11, 2009
Is Perceived Value Reputation?
There is a new book by Columbia Business School professor Donald E. Sexton that is well worth reading. Called Value Above Cost, Sexton makes the important observation that the most important function of marketing (and I would also add communications) is to enhance perceived value, which is defined as the "maximum that the customer will pay for your product or service".
This is an important concept. Perception is the same as fact in the marketplace. So, the concept of perceived value means that the job of marketers and communicators should be to enhance the perceived value of the organization with its key stakeholders. What I like most is that Sexton also cautions against the focus on "delighting the customer" that permeated company thinking for too long. Delighting the customer could mean that a company spends more than a customer is worth, leading it also to offer items for free to further delight the customer. When something is free, there is no apparent value. Value is only demonstrated when something is exchanged--money, our time, our relationship, our information, etc. Simply adding more or doing more to make a customer happy is bad business. There must be a balance between what we are willing to spend on the customer and what the customer is willing to pay for the product or service. At some point, it may no longer be worth our investment to make the customer happy, and we can actually gain competitive advantage by allowing our competitor to spend too much on delighting the customer.
Is perceived value the same as reputation? I think that the concepts are very close, if not identical. The greater the perceived value, the more the customer is willing to pay. He/she perceives us as being better than any other offer. Is that not what reputation is--being distinguished from peers as being the best? So, if we extend Sexton's concept, we can see that perceived value not only influences willingness to pay, but also willingness to join, support, invest in, etc.
The concepts contained in Sexton's book are extremely important for anyone who wants to truly understand the role of both marketing and communications.
This is an important concept. Perception is the same as fact in the marketplace. So, the concept of perceived value means that the job of marketers and communicators should be to enhance the perceived value of the organization with its key stakeholders. What I like most is that Sexton also cautions against the focus on "delighting the customer" that permeated company thinking for too long. Delighting the customer could mean that a company spends more than a customer is worth, leading it also to offer items for free to further delight the customer. When something is free, there is no apparent value. Value is only demonstrated when something is exchanged--money, our time, our relationship, our information, etc. Simply adding more or doing more to make a customer happy is bad business. There must be a balance between what we are willing to spend on the customer and what the customer is willing to pay for the product or service. At some point, it may no longer be worth our investment to make the customer happy, and we can actually gain competitive advantage by allowing our competitor to spend too much on delighting the customer.
Is perceived value the same as reputation? I think that the concepts are very close, if not identical. The greater the perceived value, the more the customer is willing to pay. He/she perceives us as being better than any other offer. Is that not what reputation is--being distinguished from peers as being the best? So, if we extend Sexton's concept, we can see that perceived value not only influences willingness to pay, but also willingness to join, support, invest in, etc.
The concepts contained in Sexton's book are extremely important for anyone who wants to truly understand the role of both marketing and communications.
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