The CEO’s Challenge : Why reputation management is vital for every business and how to deal with it.
Beyond SEO In 2016
Since the beginning of time, every business has relied upon its reputation to drive and boost their customer base. Why would anyone give their money to a business that is publicly irrelevant, or, in the worst case scenario, been recently publicly humiliated?
P.T. Barnum once said, “There’s no such thing as bad publicity.”
Yep, and he was right, but he was working in the circus industry during the 19th century. Presumably, if you are reading this, you do not work within such an arena (enjoy the pun) of commerce. Unless your business is akin to being a controversial celebrity, like Nicki Minaj, bad publicity is frankly bad for business.
As a CEO, there’s nothing that can make you wake up in the middle of the night in a cold sweat, feverishly shivering, screaming at ghostly foes, than news that your stock prices have plummeted, because of some disgruntled customer making a website named DONOTBUYFROMYOURCOMPANY.com. Or, maybe there was a devastating article in the paper, or any other form of media, that smeared your company’s name, whether deserved or not.
While a company like Ripoff Report exists, despite how dubious their credibility is, there is an expanding base of opportunities for the public to become aware of negative news, about any available company.
Nothing spells “catastrophe” like negative press, and nothing spells “doom” like irrelevance.
First, before we touch upon any of the details concerning reputation management, take this advice:
There is no doubt that you should be concerned about how to repair your reputation if disaster strikes, but do not freak out. Losing your cool as a CEO serves no one, and troubles your staff. In the face of crisis remain calm and steadfast. Do not cause bedlam through osmosis. When crisis hits, your staff is already aware (well in advance, unless you go online more than they do), so if they see a confident, composed leader, they will have greater faith in your enterprise.
Reputation management has typically been dependent upon search engine optimization (SEO) results. If a potential client or customer was looking for a good or a service, they were not going past the first page of their Google search for a provider; they were going with the top. 65% of the public in 2014 still believed an online search of your company as the barometer of how trustworthy your company is.
The same still rings true today, SEO is essential for online relevance, but…
Reputation management has taken on more than just your SEO results; it is more than just being relevant, or providing the marketplace with a reliable, highly esteemed product.
The online presence of trusted industry-specific review sites, like Yelp, can steer whether your business is gaining customers in droves, or avoiding your doors as if they contain ebola. According to Nielsen, the reality is that 66% of potential customers trust online reviews by complete strangers when making a purchasing decision. Astounding, but true.
Social media is also becoming a new medium for making a purchasing decision, as it is the current platform for staying in touch with friends and family. A whopping 71% of customers will make their purchasing choice based upon what they see on their social media feeds.
Typically, personal recommendations, from friends or family members, have carried more weight in a purchasing decision than that of a stranger. Strikingly, 79% of the public believe that online reviews (coming from strangers) are just as trustworthy as a personal recommendation.
As you can see, the poor reputation of a company is relayed to friends and family through every feasible method available. The maxim that “bad news travels quickly” rings even truer today. As 47% tell their friends and family, do you know what those friends and family members do? Tell their own friends and family about the matter as well.
What a world to live in as a business owner, yet, we are living in it, so you need to deal with it. The following are strategies and trends to heed in order to secure your reputation management.
Crisis management requires a Crisis Manager
Remember when mom told you that it is always better to be safe than sorry? She was right.
Take the case of Chipotle, who had an outbreak of foodborne illnesses strike their chain in late 2015. In the final quarter of the year, their stock had plummeted from $758 per share to $460. By the end of last year, they had to close over 40 of their branches.
Why was the outbreak so damaging? Chipotle failed to have contingencies in place, including a crisis management team. One would think that a national restaurant chain would be concerned with food safety, enough to have a qualified member of staff constantly monitoring their product. But, they didn’t.
According to Murphy’s Law, what can go wrong, will go wrong. Ideally, you should be able to have enough foresight to anticipate any potential failure or mishap. The reality is that nobody is perfect, and while running a business, mistakes are going to happen.
How you deal with these mistakes is what defines your ability to manage your company’s reputation. In Chipotle’s case, after miserably failing the public, they put into place an unorthodox public relations strategy that is repairing their reputation. In this case, humility has proved to be successful in their marketing campaign rather than sheer apology.
The fiasco of Chipotle was handled by hiring a professional crisis management firm. Such third-party firms exist to manage the reputation of an organization during times of crisis, but the wisest step a CEO can take is to already have a chief risk officer (CRO) appointed at their company.
If it is already too late and you are in the midst of a crisis, there are steps you should take when engaging in the selection process of a third-party firm. They do not only require a market savviness and technological familiarity, but they need to be dedicated to your company, with your reputation’s repair as their first priority.
If you need to use a third-party for your reputation management during a crisis, vet them personally to establish whether they choose your business just for the money, or they seek to boost their own professional reputation by achieving another success.
The CRO (or CROs if you own a larger company) will be responsible for planning and developing seminars for your staff to maintain compliance and minimizing risks. Preparation is key, so your CRO will be in charge of staying in contact with lawyers, consultants, and accountants, vetting them and keeping them abreast with your business operations and developments.
Manage your reputation beforehand
The sharpest CEOs practice reputation management from the get go. If you have not already opened your doors for business, do thorough research into the very name you are choosing for your company. What comes back when you Google your potential brand name? Is it positive or negative?
For example, if your brand name includes the word “flight”, which typically is perceived as a positive notion, what if a major plane crash recently occurred? When customers do a Google search of your company they will get back results including a recent tragedy, obviously hindering your public perception, and thus reputation.
Make sure that the brand name you are choosing has a positive connotation when customers search for you online. 85% of customers perform an internet search to find business, so you want your company to avoid negative reputation before you even launch. As you can see by this survey conducted by searchengineland.com, people are using the internet for business research several times a day:
Your employees are your greatest Reputation Managers
Nothing lends credence to one’s words than being able to say “I was there; I saw it.” To attract skilled, talented candidates, your company’s positive reputation speaks volumes about your operation. In 2016 everyone has Facebook. People even have accounts for their pets, for crying out loud.
What are your employees saying on social media about their workplace? It might not be easy to get your employees praising your company on Twitter, but it is dangerously easy to get them to complain about working for you.
Organizational transparency is becoming an important trend for companies to follow in 2016. Running a transparent company is an optimal way to build trust and garner loyalty from your employees. If a candidate can observe your company culture and share your goals, they will be more proud to work for your company.
CEOs also need to factor in how to culturally cater to the emerging workforce: the Millennials. At present, Millennials account for 25% of the global workforce and by 2020 will comprise 50%. They are on Instagram, and want to (and do) share everything about their lives with the world, including details about their job.
Privacy has evaporated from the workplace in 2016. This means that it is crucial for CEOs to manage their reputations as employers. Having a strong reputation earns you a steadier stream of high-caliber candidates willing to work for your company. By making your company transparent, you will boost your reputation among the generation that wants to know everything and shares everything.
Make customers your salesforce
Of course, it practically goes without saying, but your customers are more effective brand ambassadors than your most talented marketing staff. That is by no means a message to can your marketing team, but in 2016 a massively successful trend for companies is to wield user-generated content as a marketing tool.
Your customers are already buying your products. They are already on YouTube. Hmm, any ideas spring to mind?
Every time a customer uploads user-generated marketing content, they are practically stacking a brick of solid gold in your office safe. Customers, however, are not going to do so themselves without be told to do so.
Cleverly incentivize your customer base to be enthusiastic about displaying your product on social media. Have a brainstorming session with your marketing team on what method and means is best suited for what you produce or provide. Keep in mind, 70% of customers value peer reviews over professional advertising content.
Here is a clever example:
Say you own a car dealership. Every couple of months, host a contest for customers to take a selfie with their new car, and include that they bought it at your dealership. For whichever customer can get the most “likes” on Facebook in a fixed period of time, you grant them free oil changes for, say, two or three years.
This is just one example that may or may not apply to your industry sector, so meet with your marketing team and craft a plan that works for your company. If you need some inspiration, look at 10 user-generated content campaigns that proved enormously successful. Nothing else boosts your reputation as well as your customers advertising your company.
Hopefully, now you grasp the vitality of reputation management, and have an understanding of how to deal with it as a CEO. Through planning, research, adaptation and innovation, you can effectively manage your company’s reputation to success.
Keep in mind the words of Francesco Guicciardini – “A good reputation is like cypress; once cut, it never puts forth leaf again.”