The Relationship Between Reputation and Brand Brand reputation is the determining factor that decides whether consumers will pay and recruits will apply.

By Krishna Athal

entrepreneur daily

Opinions expressed by Entrepreneur contributors are their own.

"I don't know why you are. I don't know your company. I don't know your company's product. I don't know what your company stands for. I don't know your company's customers. I don't know your company's record. I don't know your company's reputation. Now, what was it you wanted to sell me?" - McGraw-Hill

The quote is from one of the most famous advertisements in which McGraw-Hill brings forward the thought that a company's reputation is a requirement for the successful selling of a product or service. Sales must start before the salesperson calls on the would-be customer. That is possible only when the brand has an admirable and first-rate reputation in the market. A brand having a good reputation contributes to the enhancement of its products and services' value. Likewise, a bad reputation devalues products and services and brings in further decline. Furthermore, if a brand is consistently projecting a lucid image of itself, it is more likely to build a more substantial reputation and be remembered in the future.

Brand reputation is the determining factor that decides whether consumers will pay and recruits will apply. A poor and weak reputation will negatively affect a company, while on the other hand, a good reputation will help a company both operationally and financially. In contrast to corporate image, brand reputation is owned by the public.

Reputational strategy

Whether the reputation of the brand will be strong or weak will depend on the quality of the strategic model adopted. As the profession of public relations moves more and more toward being a reputation-managing function within organizations and is less often considered an exclusive part of the marketing mix, strategizing becomes an increasingly important tool for brands.

A brand's strategy model affects the nature of its corporate reputation. A market-oriented understanding of strategy will produce market-oriented PR. A reputation-and-relationship-oriented knowledge of strategy will build reputation-and-relationship-oriented PR. It is at the moment of strategizing that crucial and defining choices must be made about the range of people who are essential to the brand, the balance of one-way and two-way communication in a campaign, the emphasis that will be placed on reputation-building and relationship-building outcomes, the values or critical ethical principles, the general timeframe within which goals will be measured and what kind of entity the brand sees itself as being.

Brand reputation consists of four crucial factors: reliability, responsibility, credibility and trustworthiness. Many theorists also argue that a brand's culture hugely influences strategy implementation, reputation and performance. As such, brands should concentrate on building a magnificent culture. The strategy should address reputation weaknesses through evolution, not revolution — aiming to achieve understanding rather than adoration from the public.

Protecting reputations and relationships

The legal and communication environments in which practitioners operate have been globalized — or at least internationalized. Communication techniques are moving away from mass-market campaigns to targeted activities that depend on relationships and reputations.

Information exchange and storage are now integral to forming effective relationships and allowing brands to "individualize and personalize' messages. The increasing reliance on computer-stored information to target communication strategies has seen information privacy emerge as a critical legal risk for public relations practitioners. Consumers are more willing to trade their personal information with those brands which have a good reputation. In addition, there are strong commercial reasons for brands implementing effective privacy policies. However, a targeted approach is recommended to address privacy concerns that take account of a wide range of problems relating to privacy. Brands must investigate the patterns of consumer sensitivity regarding information privacy, incorporate these concerns into existing databases and align communication strategies (including direct marketing).

Related: Is Public Relations Dead?

Four key segments

Companies should consider the following four key segments to analyze a rising concern that may threaten their brand reputation:

1. The elements of the brand

  • Positioning of a brand in the marketplace: A problem that becomes more dangerous if the situation gets weaker — for example, market shares or favorability in the corporate sector.
  • Strengths or weaknesses of a brand: If a brand can be distinguished at an extreme level, the better it is for the company affected unless the vital demarcation element is the subject of concern.
  • The fundamental meaning of the brand.

2. Situation of crisis

  • The intensity of the situation from the beginning: If a problem affects many people, or if it is an alarming issue. For example, finding salmonella in food products leads to severe health problems or even death.

3. Initiatives taken by a company

  • Effect on brand: All activities carried out by a company influence the brand, especially communications.

4. Evaluation of results

  • Measuring efficiency: In terms of recuperation/reopening, rebranding or shifting market share.

Related: How to Leverage Artificial Intelligence in Public Relations

The legal environment

To manage the reputation of a brand, PR practitioners must operate in a legal framework. Legal advice must be interpreted from a PR perspective to ensure that quality decisions are made. Working with legal input, PR practitioners can move towards a systematic approach to dealing with the law. Brands should develop a legal strategy for their specialty area, setting best practice benchmarks in potential areas, such as contract law, intellectual property, defamation, contempt and consumer protection law. Developing a legal strategy and compliance systems will not eliminate legal problems, but it will go a long way towards minimizing the harm that may arise from these problems.

Litigation public relations

Sometimes parties to litigation or brands charged with offenses look to public relations to "control the damage" of proceedings. Communications strategies adopted during the litigation process to manage the effect/impact of proceedings on a brand's reputation are commonly referred to as "litigation public relations". Litigation PR aims to counteract negative publicity, present a client's viewpoint, ensure balanced media coverage, help the media and the public understand complex legal issues, defuse a hostile environment and help resolve conflict. Any practitioner engaged in litigation public relations must be aware of the legal status of any case and factor the contempt of court laws into any advice offered to brands seeking strategies to minimize potential harm. Liaising with court public information officers will help practitioners to keep track of proceedings.

The public relations duty of care

Many brands establish contracts with PR agencies, in which particular standards of care are specified. If these standards are not met, then the brands have a right of action in the contract. Professionals are obliged to give skilled advice based on the possession of a body of knowledge. In public relations, a duty of care will arise where advice is provided on a brand matter; the adviser knows or ought to know that a brand will rely on the advice given. A practitioner's obligation to exercise proper care also extends to third parties who can reasonably be expected to rely on this information and advice, including shareholders and investors.

Public relations has a vital function in developing various corporate activities, which results in promoting brand reputation. Corporate Social Responsibility (CSR) is one of the schemes opted by PR for targeted audiences to boost corporate reputation. Ultimately, it would be safe to say that PR practitioners cannot build and maintain a good reputation for a lousy brand; it will not last. Practitioners must bring appropriate policies and ensure good quality of products or services. If asked to do so, PR professionals should be transparent to the management of the brand by revealing its reality and proposing new favorable policies.

Related: Is Your Brand Ready for Public Relations and Press?

A recipient of numerous leadership and innovation awards, Krishna Athal has a BA in business and enterprise, an MBA in leadership and management and is currently a PhD candidate in leadership and entrepreneurship.

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