Corporate reputation is a collective representation by stakeholder audiences of a firm’s past actions, results, and communications. Individuals and groups create, share, reinforce, and modify these representations … They are cultural constructs. Research shows that reputation has both cognitive and affective dimensions. Reputation encapsulates expectations by stakeholders about future behaviors of the corporation, and thus determines the relationships between the organization and its stakeholders. Corporations that routinely monitor, measure, and evaluate their reputation, risk, and the drivers of reputation and risk among specific stakeholder audiences will be able to identify opportunities and threats, develop action plans, and support the achievement of desired business outcomes. In a networked world, corporations must re-orient their listening in the competitive marketplace to be faster, smarter, and more stakeholder centric. By understanding, through content analytics, leading indicators of opinion trends towards a company, its brands, its products and services, and by understanding issues, topics, and market trends, companies can take steps to gain competitive advantage and protect themselves from risk. This presentation will look at applications of Smart Content.
A strong reputation becomes a capital asset, a resource, a competitive advantage, and an intangible that the firm can manage to support organizational goals. A small but compelling set of studies does show a statistical relationship between corporate reputation and business outcomes. Positively affects stock performance Improves financial performance Attracts investment and lowers long-term cost of capital Dampens risk Helps attract customers and support growth Commands a price premium Supports stock price in times of uncertainty Adds to stock price by capturing intangible assets Intangibles lead to a sustainable competitive advantage
Agenda-setting theory is thescientifically-validated link between a company’s presence in the media and reputation.
Agenda setting theory was developed by Maxwell McCombs and Donald Shaw in 1968
General theory validated by over 400 field research studies around the world, primarily in political science
Validated in experimental studies
Extended to corporate reputation
What is risk? Risk is a state of uncertainty where some of the possibilities involve a loss, catastrophe, or other undesirable outcome … with respect to issues and situations. Risk deals with the future … the unknown. Emotion comes into play. We worked with a team of academic neuropsychologists to develop a 19 dimension model of risk.
Problem: Significant net outflow the client company funds over six year period. Assumption: The management felt that fund performance drove investment in their funds. Was there a relationship between net flows and shifts in perception about the company or its fund managers?
Solution: A statistical evaluation to determine the potential contribution of Janus’ reputation into the investment decision of investors.
Result: Relationship between reputation and net flows was found and led to the launch of a successful communications and outreach program focused on trust, versus performance, resulting in largest gain in net flows in company history
Use content analytics to … Listen to stakeholders Organize and share information across the enterprise Understand stakeholder opinions Cognitive messages and opinions Emotions and risk factors Identify influencers Opportunities and threats Engage and communicate Fix the problem
We could identify what the stakeholders were talking about.
These are the rational, cognitive elements of the communications landscape.
Vulnerability: A mommy blogger said: It is a sad commentary on our fast pace world that we can not even protect our innocent babes! Dread: An AP news story said: Worried parents have bombarded the maker of XYZ with phone calls and peppered Facebook and Twitter pages over fears about the top-selling [product] after millions of cans were recalled. Uncontrollability: A blogger said: “We were hitting with 3 to 4 devices and finally got through … Then after 8 to 10 minutes, we got a notice saying it’s been recalled.” Irreversibility: A new mother said on local TV news: "I was quite upset because we'd already fed him some milk from the powdered containers.” Untrustworthy: A father said on local TV news: "I'd say I've lost a little bit of faith in that brand. It was sold to us at the hospital when he was born.We were loyal to that product.”
But, these kinds of emotions can have an impact on buying behaviors if they grow.