Talking it up: why communications make reputations

  • Opinion
  • May 8, 2015
  • Nikki Wright
Talking it up: why communications make reputations

In philosophy there is a well-known thought experiment: “If a tree falls down in the middle of a forest and no-one hears it, does it make a sound?”

When it comes to corporate reputation, the question could be modified to: “If a company is doing great things but failing to tell the world about them, will anyone know?”

Unless Voldemort is your chief executive, a good corporate reputation is likely to be near the top of your company’s priorities, right up there with profitability. 

But is having a good reputation really such a big deal for businesses? And how important is communications in developing and maintaining that reputation?

The first annual Colmar Brunton Corporate Reputation Index, developed in partnership with Wright Communications, shows the answers to those two questions are: “yes” and “very”.

  • See the list here

The survey is the only one of its kind in New Zealand and uses the patented RepZ method created by Colmar Brunton’s parent, the global research firm Millward Brown.

RepZ measures corporate reputation across four categories: social responsibility, fairness, success and trust. The average score globally is 100, with scores of 105 and over considered “strong” and those of 95 and under “weak”.

Air New Zealand came out on top of the inaugural Colmar Brunton Corporate Reputation Index with an impressive score of 118, followed by Z Energy with 114. 

Both these companies excel in the corporate communications department, helping them maintain excellent reputations despite operating in two industries, aviation and petrol retailing, that are prone to negative headlines.

Wright Communications is proud to see one of its clients, Toyota New Zealand, come in at fourth while achieving the highest score in the fairness category.

But having a good corporate reputation is about more than just warm fuzzies. Research by Millward Brown has shown there is a strong relationship between reputation and sales.

On average almost three-quarters of consumers would consider buying from companies with strong reputations, compared with under half (46 percent) for companies with weak reputations.

This is why communications is crucial to a company’s reputation: when it comes to consumers, investors and other stakeholders, perception is reality and that perception can influence whether people buy your product or your stock.

To varying degrees, all four categories in the survey are affected by the company’s communications strategy.

For example, success is not just about revenue, profit and other financial metrics but also about how investors perceive a company’s brand, its position in its industry and its growth potential. 

A $100 million profit may be seen as an excellent result or a disappointment, depending on how it is presented, how the company managed expectations beforehand and whether the business has a clear growth path it is following.

Global technology giant Apple topped the success category in the Colmar Brunton Corporate Reputation Index, followed by Air New Zealand.

Social responsibility is another category where the company’s communications strategy can be the difference between positive and negative public perception, because treating employees well and being environmentally responsible are largely subjective standards. 

Air New Zealand topped this category, followed by Z Energy. For a company that uses large amounts of jet fuel and another that sells CO2-emitting petrol to score so well in this category is remarkable.

But the two categories where communications arguably plays the biggest role are fairness and trust.

Fairness is measured on whether a company is seen to offer fair value with its products.  The fact Toyota topped this category shows Kiwi consumers believe they are getting value for money when they buy one of its cars.  

And finally, companies are measured on trust.  This is the most important category by far, accounting for 37% of the overall weighting in the New Zealand survey, compared to only 16% globally.

The lesson from the Colmar Brunton Corporate Reputation Index is clear: if you want a good corporate reputation in New Zealand, trust is essential.

Air New Zealand topping this category was a critical part of its success in the survey overall, while Z Energy was again runner-up. 

This is where their outstanding corporate communications come to the fore. Trust takes years to build and only a day to destroy, so companies must be clear, transparent and consistent in their public communications. 

At no time is this more vital than during a crisis or issue. Air New Zealand won plaudits for its swift and decisive response to a test flight crash that killed seven people in 2008, a tragedy that could have done serious damage to its reputation if not handled correctly.

Ultimately corporate reputation is about substance rather than style. Communications is not magic and will not turn an unprofitable company with poor practices into a stock market darling.

However, communications can be the difference between an average reputation and a good one, or even a weak reputation and an average one. 

Communications is sometimes seen in the corporate world as a box to be ticked, but if done well it can be a great asset to your business and ultimately boost your bottom line.

  • Nikki Wright is managing director at Wright Communications. 
  • This article originally appeared on LinkedIn. 

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TVNZ rolls out Survivor with a burst of contemporary style

  • Advertising
  • April 28, 2017
  • Erin McKenzie
TVNZ rolls out Survivor with a burst of contemporary style

With ​​Survivor New Zealand set to hit screens on 7 May, TVNZ has released another round of its campaign with a colourful, energetic video via TVNZ Blacksand, as well as unveiling the contestants. We chat to executive creative director Jens Hertzum about giving the local format a contemporary and fun feel.

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