Why Reputational Equity Matters Now
In a private memo directed at Berkshire Hathaway’s top managers, Wall Street icon Warren Buffet proclaimed: “We can afford to lose money – even a lot of money. But we can’t afford to lose reputation – even a shred of reputation”.
Warren typically drinks 5 Coke’s each day and to go with a morning breakfast routine of dropping $3.17 at the McDonald’s drive-through for a bacon, egg and cheese biscuit. While his dietary habits may be questionable, no one disputes Buffet’s well-deserved reputation for being a shrewd business thinker. His 2014 memo may be even more relevant right now for companies struggling to navigate the crashing seas of 2020’s multiple economic storms.
“At no point in history has your organization operated in such an unpredictable and unruly market. Consequently, reputational risk has become a very real issue”.
With the balance of power firmly in the hands of a digitally connected, increasingly skeptical and snarly consumer, your brand now competes for attention in a fickle, hostile environment. One false move, tweet or Instagram post and your reputation could be blown to perceptional smithereens like that day someone lit a match on board the Hindenburg.
But what if you turned the tables and made COVID-19 the best thing to ever happen to your brand? Could you seize the opportunity that exists to build Reputational Equity? What would transpire if you – as a leader – became hyper-aware and intentional about your role in depositing enormous amounts of digital goodwill into your social media bank accounts?
There are practical steps you can take to ensure your brand is not just another faceless boat in the business ocean; feeling powerless and drifting aimlessly along with everyone else in your competitive space.
Warren Buffet himself would nod in agreement that Building Reputational Equity is one of the shrewdest strategic moves you can make on this edition of Leaders & Legends.
“It takes many good deeds to build a good reputation and only one bad one to lose it” BENJAMIN FRANKLIN
p.s.... Reputational Equity is a simple formula to describe the amount of public trust and goodwill earned over a long period of time by any business, personal or non-profit brand. It calculates the amount of Public Confidence + Consistent Awareness that has been instilled and multiplied over an extended period of Time. Think of it as perceptual interest that keeps accumulating the more your business and brand demonstrates the ability to deliver on promises while also communicating your story on a consistent basis with real human beings who all have smartphones and social media accounts. The more impact you make with people who are genuinely commenting on, sharing and interacting with original content you have created, the more Reputational Equity you are building.
After visiting with business leaders in Kelowna, B.C. last week, I have my fingers crossed that many will grasp the strategic importance of growing and nurturing a virtual audience since it's the only one many of us will have for quite some time. In other words, there has never been a better time in the history of commerce to build your brand in the on-line world as it is the only viable option remaining for any small to medium-sized business.
Which now begs three hard questions for any business leader:
Are you being intentional about projecting a more likeable and helpful side of your brand personality? Or are you staying on the digital sidelines and running the risk of having the market perceive you to be stiff, dated and out of touch? With Facebook and YouTube, for example, how can you reasonably justify the competitive advantage in refusing to make goodwill deposits on the world’s two largest platforms for the low, low cost of free?
Is your brand playing a dangerous game, allowing customers, potential talent and fans to go elsewhere with another provider they feel more of a human connection with? In other words, it’s no longer enough to simply provide great products and services since the Attention Economy is demanding that companies and their people become part of the on-line community with a human presence and personal touch.
Have the business owners become so focused on on short-term sales that they are neglecting and forgetting the long-term consequences that come with failing to build an on-line community and a private list of fans. In our globalized digital village, trust and brand loyalty mean everything to an organization that has also taken deliberate steps to create its own audience. Forward-thinking leaders will recognize brand reputation is not a separate entity to a business, but an asset that becomes inextricably tied to it.
In many ways, my friend Dave Carroll is like any other business owner. He is considered by many as a latter-day version of Gordon Lightfoot, Murray McLaughlan and Stan Rogers; one of this generation's truly great Canadian folksingers. But, with one significant business difference. Before the Internet, musicians needed record companies and recording contracts to reach their audience for which they were compensated with advances and royalties. Musicians like Dave, who do this for the love of the game, have no such support in the Digital Age, which makes his latest song even more remarkable; a shining example of why his kind of music is needed now more than ever. Dave did have a viral hit over a decade ago with "United Breaks Guitars" and while the fame was great, his latest tune is the kind of song that creates a more permanent legacy. The one that adds to his growing reputation as one of Canada's most important voices.
p.p.s... The chair of TEC Canada group 655, Shaune Eldred (pictured above) believes Reputational Equity is like any other business equity (assets, cash, etc), something you need to build and protect over time. In her words, "Your brand is not just a pretty logo and a tag line – it’s also everything you say and do - the way the phone is answered, the product that is delivered, how it is delivered, what condition it is in, and how it is cared for after delivery. It’s how you and everyone connected to you in your business treat people – both clients and employees. It must be nurtured and driven from the top of the organization. To me, brand and culture are completely intertwined and the only way to build Reputational Equity in this fast-paced environment is to get the message out there. We don’t all have a Nike marketing budget, but we can certainly get our message out there through Facebook, LinkedIn, and other social media platforms".
NOW BOOKING VIRTUAL EVENTS FOR BIG LITTLE LEGENDS!
The language of brand speaks to humans in a way that is metaphorical, meaningful, emotional and symbolic. The language of business communicates in a way that is logical, literal, mechanical and analytical. How then, does a business leader – in any industry – any product/service category become fluent in BOTH of these vitally important languages?
This unforgettable keynote/workshop (and preview of the forthcoming book) is now available in a Virtual format, Designed to challenge accepted notions of how long-term brand-building really works these days, it forces leaders to re-think what's possible and the role they play in creating modern-day legacy. Here is a preview of BIG LITTLE LEGENDS - How Everyday Leaders Build Irresistible Brands.
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