Business reputation – why it matters more than ever
Igniyte have been in the business reputation game for decades. The online reputation management experts know that little matters more than a company’s reputation…
One of the most important facets of a company’s marketing strategy is reputation management.
After all, without a positive reputation, a business can lose everything from employee support to a customer’s loyalty.
Managing corporate reputations, however, tends to fall by the wayside for many businesses. Here’s why a positive reputation for your business matters more than you may think.
Online reputation management is vital for success in 2022
Of course, a company’s reputation has always mattered greatly.
But in today’s 24/7 connected world, actively managing that business reputation is integral to future growth.
The stats we’ve collected below clearly demonstrate that those who don’t yet think reputation important will fall behind.
Five billion people are online around the world
While most of us are fully aware that customers have shifted online over the last 10 to 15 years, many don’t know just how far the Internet has penetrated UK society.
Figures from January 2022 show that around two-thirds of the world’s population is online – around five billion.
However, in the UK, Internet penetration was at 98% at the start of the year. Stats show that 66.9 million people routinely use the Internet. Between 2021 and 2022, the number of Internet users increased by 300,000 and we can reasonably expect this rate of adoption to continue.
So, from a total population of 68.35 million, the UK has 66.99 million Internet users, 57.6 million social media users and 59.88 million mobile Internet users. And all of those people perceive brands, businesses and companies based on what they see online.
Corporate reputation management in the digital era
The whole concept of how best to manage business reputation has fundamentally altered, particularly over the last decade or so.
It’s now a given that customers shop online and routinely research a company’s reputation before they part with their money.
All of this means what used to be a transient PR problem can linger far longer in the minds of potential customers. For example, let’s say a CEO of a multinational business was caught out for financial irregularities.
Thirty years ago, while this would naturally have caused a PR problem, the fact that it would disappear from newspapers relatively quickly allowed for the positive reputation of the business in question to bounce back.
Fast forward to 2022, and the same kind of PR disaster going viral on Twitter in minutes of being published online. It takes off and suddenly, this person’s actions are heavily damaging the business’s reputation.
A single reputational crisis can seriously damage a brand reputation that has been carefully built up over time.
Take a proactive approach towards a positive reputation
The connected nature of the Internet means that in order to properly maintain a company reputation, a proactive approach is necessary.
Any start-up or new business should factor in the need to create, maintain and manage a positive online reputation.
Ideally, a mew business should start out by absorbing reputation management into the internal culture. Employees, human resources and business leaders alike should fully understand how to make reputation management important to all.
External perceptions of a business, brand or even individual affiliated with that business or brand, are arguably the most important facet of any marketing strategy.
Don’t wait for a reputational crisis to take action
For businesses that have been around for a while, the importance of reputation management may not arise until there is a crisis.
And while there are plenty of actions that can be taken to repair brand reputation through an appropriate crisis management plan, ideally reputation management should be proactive rather than reactive.
Businesses that are relatively confident that their company reputation is a good reputation, should also have a reputation management strategy in place. The idea then should be to take your good reputation and make it great – and ensure that nothing happens to set it back.
Why is a good reputation important to customers?
As we know, the majority of customers search a business name online before they decide to go ahead and spend their money.
This means that what they see on the first page of Google search results informs their opinion of your business.
Around 68% of all experiences online begin with a search engine. And that search engine is usually Google. Interestingly, research shows that even when a customer knows a brand name or business name, they are still more likely to type it into Google search rather than go straight to the business website.
Company reputation matters to customers and employees
Either way, customers immediately find reputation important when searching online, whether they realise it or not. The first few links they find on the first page of the search results will inform their opinion and the perceived value of the brand or business in question.
In other words, your target audience will form their opinion of your business depending on imagery related to the first few links on a Google search.
Multiple channels will undoubtedly show up, including links to positive reviews, commentary on the company’s internal culture, general review sites, social media comments, online reviews and all kinds of brand visibility markers.
If your business reputation is built on these results, and they include negative reviews for example, then this could impact your ability to retain customers and to get repeat business. Not only could you lose customers, you may find that brand perception is damaged for new customers too.
Is Google really that important for business reputation management?
In a word, yes. In fact, as of the beginning of 2022, Google’s global market share stood at 91.9%.
This means that your online reputation is made and lost through the search results that people see when they search your company name.
If we look even deeper at Google figures, we find that organic search results are far more important to the good reputation of your business than paid for links.
Around 90% of Google users automatically weed out paid for results and look for links that appear to give them the ‘word of mouth’ lowdown on the search subject.
We can see from this why review sites are so important to the good reputation of a business or brand. Positive reviews immediately build on that good reputation, while negative online reviews do the opposite.
A brand’s online presence isn’t just about negative reviews or positive reviews, but they are extremely important when it comes to the human psychology behind decision making for customers.
Every day, around 8.5 billion Google searches are conducted by potential customers around the world.
And it’s the top three links that show on page 1 of the results that people take the most notice of. Arguably then, these three links influence the good reputation or bad reputation of your business. Research shows that only 0.78% of potential customers look beyond the first page of links when they search a business or brand name.
A number of factors combine to make a good business reputation
Customers love honest, two way communication with businesses. If they feel they don’t have this with smaller companies in particular, then their perception is likely to be more negative.
Traditional reputation management lay in PR and external communication with print media. Today businesses should have an internal reputation management department, particularly if they are over a certain size.
Customers absolutely do find reputation important when it comes to deciding where to put their business. And today reputation management covers traditional print media, and social media channels, review sites, the opinion of prospective employees as well as existing employees and all kinds of online negative feedback floating around.
Managing social media means managing reputation
Social media channels offer customers more information about a business than they’ve ever had access to before. And this means increasing reputational risk for businesses, which need the reputation protection of a workable strategy.
Business reputation management then, is about securing good coverage externally, building trust with customers via various online channels, cultivating positive ‘word of mouth’ chatter about your company online and managing the reputation of individuals linked with your company.
A business’s reputation can be adversely impacted by the behaviour and perception of high profile people linked with it too. This could be C-suite business leaders or employees talking about the company online.
Here’s how an individual can negatively impact a company reputation
A great example of the way a high profile individual can negatively impact a company’s reputation can be seen with SpaceX and Tesla CEO Elon Musk.
Famously outspoken on Twitter and other online channels, more customers are aware of Elon Musk than of many other leaders.
And whether you consider Musk to have a great reputation or a poor reputation, there can be little doubt what he says as an individual impacts the market value of his companies.
In May 2022, Musk announced on Twitter his intention to buy the social media giant and take it private. It soon became clear that Musk’s Tweets were directly responsible for Tesla’s stock prices plummeting in the wake of the announcement .
A month later, another company owned by Musk – SpaceX – broke its silence by publicly calling out their CEO’s poor reputation and its adverse impact on them as employees.
As reported in the Verge they wrote an open letter to the board criticising Musk, saying that his… “… behavior in the public sphere is a frequent source of distraction and embarrassment for us… as our CEO and most prominent spokesperson, every Tweet Elon sends is a de facto public statement by the company. It is critical to make clear to our teams and to our potential talent pool that his messaging does not reflect our work, our mission or our values.”
Building and rebuilding customer trust
Musk offers a very clear, explicit example of the damage an individual can do to the sustained earnings or an affiliated company.
Rebuilding trust with customers takes precious time and a shared effort for companies. In order to lower marketing costs associated with reputation then, it’s logical to have a plan in place to deal with crises. But also to have a reputation management plan in place at all times.
For Musk, the Twitter story rumbles on and continues to impact his companies, even though the actual products and services aren’t involved.
After trying to ditch the deal in July 2022, it’s currently unclear as to whether Musk will be forced to buy Twitter after all. But regardless of what happens with the deal, no one is going to be congratulating him on his excellent reputation and the positive impact it has on his companies.
One could, of course, argue that Musk is too rich to care about his reputation or even that of his companies. And perhaps that’s true. But for most companies, reputation management is absolutely key.
Think of any example of a rogue Tweet adversely impacting a business or brand. The vast majority of these reputational crises could have been avoided had the company in question a strong marketing and reputation management strategy in place.
Greater revenues can be accrued through effective reputation management than through a traditional PR strategy. Lower costs are another bonus for a company who takes a proactive approach to building and keeping a good reputation.
Leverage public opinion to maintain a company’s reputation
We’ve touched on the importance of reviews for the reputation of a company.
A bad reputation can be caused by poor reviews whether it’s on the company’s website or am independent review site.
Similarly, a good reputation can be caused by effective management of these opinions from customers. The way to make sure your business doesn’t suffer from a bad reputation is to provide a platform with which you can communicate with customers.
Provide the central location for customers to talk to your business, then make sure you listen.
When you have this in place, you can routinely exceed customer expectations. This will go a very long way to ensuring a positive online reputation for your brand or business, without you needing to spend more money on expensive marketing strategies.
Don’t miss what’s really important for your corporate reputation
We find that it’s quite common for businesses to miss out on the benefits of effective reputation management. In fact, many only really become aware of how important their reputation is when something goes wrong.
Building trust should be at the heart of every reputation management strategy.
In fact, effective reputation management strategies are all about honesty at every stage.
By creating the kinds of channels through which customers can communicate with you openly and honestly, you will have a true vision of your brand and corresponding market values.
To find out about Igniyte and how we can help you improve your company reputation, click here.
