Reputation, in general, is the opinion of a group of people have over something. It is acquired through both direct interaction and word-of-mouth. So any reputation a brand has is pretty much acquired through its consumers. However, this is not limited to the product’s quality. A car company can have the best car in the entire industry but there are several factors that may make it not the car of choice for the entire market. Factors such as workforce treatment, environmental, and ethical reasons could affect a company’s reputation to make people uninterested in buying. According to the World Economic Forum, an average of 25 percent of any company’s market value can be attributed to how the public perceives them. This significant percentage alone should alert companies to be more concerned with reputation as much as marketing or advertising. In addition, having a great brand reputation allows, for example, some established multi-national companies to have the capacity to up-sell their products because their reputation serves as a security blanket that people will get the quality they are expecting.
Customer loyalty is also a side effect of a good brand reputation. An increased level of trust would easily help them make the choice on which products to buy despite the competition. And thus, it creates higher sales and increased profits. This eventually leads to a better opportunity for expansion. After all, it only makes sense that a company well-beloved by the company extends its reach further out. A good reputation would also give them enough of an assurance that expansion would be well received by the public.
In addition, a good brand reputation attracts the best of people in the workforce. Some employees strive hard and make certain companies their goal workplace just because of its popular reputation in the industry. This ensures that you have a good pool to choose from and you can keep producing the quality of products and services to the public. This may take a while to manifest especially if you are starting out, but if you value your current employees right now, it also promotes employee retention wherein they are more compelled to be loyal to you. After all, employee resignations are higher in times of crisis because just like your consumers, they want security in their source of income.
Warren Buffet, one of the world’s richest individual, once said that “it takes 20 years to build a reputation, and five minutes to ruin it” and it speaks so much truth with businesses these days. Companies who have been in the industry for decades would only need a simple crisis to flush all of their efforts for reputation down the drain. This is a reason why reputation management strategies are an important aspect for any company, having reputation management consultants like the company found here plan steps to help you maintain your management in the event of a crisis. Thus, companies right now are encouraged to work with a reputation management team on top of the usual marketing department because these people are mainly focused on how the public - including its stakeholders - perceive the company and how confident they are with the service and products they provide. They act as brand managers whose main purpose is to maintain reputation and, on the unfortunate chance of crisis, act immediately to repair the damage.