Brand & reputation rankings? They each only tell half the story.
Is a strong reputation enough to assure business success? Perhaps not, if you consider the results of Reputation Institute’s RepTrak survey that were published last week – which seem to suggest a good reputation alone is not enough.
And how about having a strong brand, is that alone enough to secure long-term success? Again, perhaps not, if we also consider the results of the BrandZ top 100 most valuable global brands in 2015 report.
Starting with the RepTrak survey: The UK results show Lego as the “UK’s most reputable company” with Kellogg’s in second place – the first time these two companies have appeared in the UK results. The John Lewis Partnership, by contrast, dropped way back to 13th position, after ranking first in 2014.
During the presentation of the results, Reputation Institute observed, “UK companies are lagging behind their international peers on their reputation journeys and need to catch up.”
So let’s just think about that for a moment: if we take these results at face value then Lego and Kellogg’s have better reputations in the UK than the John Lewis Partnership. There’s something about this result in particular that instinctively doesn’t feel right.
Particularly if we consider that both Lego and Kellogg’s have recently suffered reputational issues. (Lego coming under attack from Greenpeace and Kellogg’s – despite valiant citizenship efforts – continuing to fight for share in a declining category.) Yet we’re to believe – on these results – that they still have better reputations than the John Lewis Partnership?
That’ll be the John Lewis Partnership that last year celebrated its 150th anniversary with its best ever trading results, the very John Lewis Partnership that has never suffered any real reputational issue and the same John Lewis Partnership that is held up by government, NGO’s and charities as a beacon of a sustainable business model that more businesses should be encouraged to follow.
So what’s going on with these rankings?
Well, dig in to the methodology and we begin to understand some of what might be going on here. The rankings are based on just 100 individuals rating each company. The sample is nationally representative meaning that those 100 ratings are likely to be from individuals spread thinly across the UK and from all walks of life. Now, John Lewis is a great company but it is a brand that appeals directly to a specific segment: the aspiring middle classes. So, whilst many people rating John Lewis will give it a stellar reputation score, some of those surveyed will have heard of John Lewis, but will have no real experience of, or affinity with the brand so might well be more luke-warm when rating its reputation.
Lego and Kellogg’s on the other-hand are power brands, both with higher levels of awareness, recognition and reach than John Lewis. Both Lego and Kellogg’s are brands that transcend social class and both are brands that the vast majority of us would have known since childhood.
So, perhaps this is also a story of brand reach and brand awareness than purely reputation?
Hold that thought for a moment whilst we travel across the Atlantic and observe the results from the USA RepTrak survey.
In the USA there’s something even more perplexing about these rankings. According to Reputation Institute, Samsung has “taken a bite out of Apple’s reputation” as the study reveals that Apple has fallen out of the top 100 best reputations in the USA (it crawls in at 158th place) and Samsung has shot up to 28th place, leading the category. Not only that, the survey results also tell us that the number of people stating they “would buy this product” has increased for Samsung to 68% of the US public whereas for Apple it has declined to 54%.
Wow, kudos to Samsung, but this doesn’t seem to reflect what people are actually doing. During the same period that this survey was conducted, Apple was outselling Samsung in the US Smartphone market, gaining market share and extending its lead over Samsung.
And what about the BrandZ top 100 study? Well, here it’s interesting to observe that Apple is now the world’s most valuable brand. (Even though it has a less than stellar reputation, see above.) And Google is the second most valuable brand. And yet this is despite both companies suffering significant reputational issues in various places around the world. In particular, Apple in regards to the treatment of workers in China and Google, also with issues in China, and more recently criticism around its position on an individual’s ‘right to be forgotten’.
So, what can we conclude from these two studies?
Well, it seems that a strong reputation alone isn’t enough to ensure business success. What Apple has – and indeed Google, Lego and Kellogg’s – is a strong brand. They have a brand that resonates with huge swathes of consumers and a brand that – even when their reputation might be suffering – drives people to still buy their products.
The warning shot here is that whilst a strong brand can offer protection, continual hits on reputation will erode support from wider stakeholders. This is a risk as low levels of wider stakeholder support is shown to have a direct affect on a company’s very freedom to operate, particularly in a crisis. The obvious case of note is the unraveling of BP’s reputation following the Deep Water Horizon oil spill of 2010. Just before the catastrophe BP’s brand was riding high, but underneath, it had a bad reputation with regulators and congress meaning when disaster struck, no one was willing to provide any positive support to BP. In fact, just about any one who could speak on the subject was highly critical of all aspects of BP’s operation meaning it took many years before BP was able to regain any level of support. Even today, some drilling licenses are still withheld by US regulators and the fall out continues to hamper BP’s freedom to operate and its financial performance.
In conclusion: beware of concluding too much from brand and reputation rankings. Whilst they are a good indicator on how your company is perceived on some narrow factors, taken alone they don’t tell the whole story. To do that, you must look at the strength and influence of your brand together with perceptions of how your company is considered to be performing on the more rational reputation related attributes. And don’t just take my word for it, Dr. Charles Fombrun, founder of Reputation Institute, has also encouraged companies to focus on both corporate brand and reputation in a recent blog post.
Long-term success is founded on building both a strong brand and a strong reputation together. And the John Lewis Partnership certainly knows all about that!
Spencer Fox is a brand and reputation consultant and has advised companies such as AstraZeneca, ITV, L’Oréal and Tesco. He is a founding partner of Tovera Consulting – a brand and reputation research, measurement and advice company based in London that helps companies build both strong brands and reputations.