Archive for the ‘advertising’ category

Reputation – why it matters and how you can manage it

09/11/2010

“…Reputation, reputation, reputation! Oh, I have lost my reputation! I have lost the immortal part of myself, and what remains is bestial…”

William Shakespeare Othello. ACT II Scene 3.

Later this month, the Chartered Institute of Management Accountants (CIMA) will publish a report by Leslie Kossoff entitled: “Reputation – why it matters and how you can manage it.”

In the weeks leading up to publication, Bodyproject will be debating the role of reputation in relation to high performance and growth.  Bodyproject’s Advanced Stakeholder Management (ASM) methodology supports organisations in protecting and promoting reputation.  In this first article we look at the importance of reputation and its critical role within successful organisations.

CIMA President, George Glass, recently drew a parallel to a famous beer commercial when he said: “Management accountants add value to the corporate parts other accountants cannot reach.”  It’s an interesting thought and not before time that a key business profession realises that they have further to go in adding value than their role suggests by also considering the value attributed to reputation.

In our opinion there are three dimensions to business success: performance, growth and reputation.  The first two dimensions are tangible, measurable and therefore manageable.  They are the bastions of traditional accounting defined by the elements that make up book value and can be measured by the strength of the balance sheet.  The third dimension, reputation, is different.  It is almost wholly intangible, difficult to measure and therefore very difficult to manage.

And yet, reputation’s value and consequent potential liability is great, almost infinite in some respects.  Whilst book value and traditional accounting is one way of valuing a business, it misses the true value that makes up a business’s intellectual capital – the goodwill that creates the absolute value that is often only realised during a sale but may be severely damaged or enhanced at almost anytime.

Mario Simon, the Managing Director of American market research company Millward Brown Optimor illustrates this when he says: “In 1980 almost 100 per cent of the value of an average Standard & Poor’s 500 company consisted of tangible assets such as chairs, factories and inventory.

“That figure is now more like 30 or 40 per cent – the rest comes from intangible value, about half of which is attributed to brand.

“It is not a stretch to say that for many companies brand is their single biggest asset.”

So, it is hardly surprising that reputation is now being recognised as increasingly the most critical dimension of success.  High growth and performance are vitally important but equally so is the protection and promotion of reputation.

So what exactly is reputation and how does it differ to brand?

Brand is often defined as the ‘corporate promise’ that it is assumed that the organisation has some control over, whilst reputation is more a way stakeholders perceive the organisation.

Chris Fill, co-author of Managing Corporate Reputation, describes brand as: “how a company wants to be seen and is all about the corporate promise. Reputation is entirely a stakeholder perception over time.

“Stakeholders will make an assessment of how well the organisation has performed against the brand’s promise.”

In our view reputation is not that simple to define and its lack of tangibility makes it a difficult proposition for people to understand.  Reputation is made up of three component parts:  identity, image and personality.

Identity is similar to the corporate promise in that it is almost wholly controlled by the organisation and is ostensibly what it says about itself through its brand, advertising, products and services etc.   Image is the reverse opposite – the perceptions of its stakeholders.  The third aspect is that of personality – often this can be viewed of how well the identity and image match up but actually is more like the state of reality in which the organisation exists.  It is actually the organisation’s true self as opposed to the rather different realities created through identity and perceived through image.

This is hugely complex and is deeply swathed in all sorts of philosophy and psychology.  But if organisation leaders do not intellectually grasp its importance then they risk their performance and growth.

When Kraft Food Inc bought Cadburys they were buying a company with a book value of £4bn.  They actually paid more like $11.9bn.  The element of ‘goodwill’ or intellectual capital was a huge proportion of the value of that acquisition.  The battle for the sale was hard fought and included a massive aspect of reputation with over 94% of the British population reporting through a YouGov poll that they were aware of the sale.  For the harsh corporate Kraft it all came as a shock.  When they went on to sell a factory, against promises made during the sales process, their reputation was badly hit and ended with them apologising to the British Parliament.

In fact the Kraft Foods Chief Executive Irene B Rosenfeld in the lead up to the sale recognised the importance of reputation and its link to the intrinsic value of intellectual capital when she wrote to the UK Government’s business secretary stating: “(she understood) the concerns of the UK government and I can again assure you of our intentions to proceed with sincere respect for Cadbury’s heritage, people and identity.”

On her recent visit to the UK she jokingly said that she had been surprised at the role of the Crème Egg in British culture.  No joke really when that product alone has estimated brand value of £45m.

David Haigh, CEO of brand valuation consultancy Brand Finance, explains the value of reputation in relation to brand when he says: “Brands affect all audiences or all stakeholder groups – from customers to staff and financiers.

“If the brand is highly regarded then they behave in a more favourable way towards the organisation, which then drives up its value.

“For each of the audiences of an organisation there is the same broad set of criteria – functional delivery, image and conduct – by which they judge whether it’s a good brand or not.”

At Bodyproject, we try to look at the entire role played by performance, growth in concert with reputation.  We no longer think that book value is an adequate judgement of value and that competitive advantage is derived solely from the tangible aspects of doing business.  It is the management of stakeholders and the integration of marketing communications as a ‘hard’ discipline alongside accounting and legal that the true difference is seen.

The Kossoff report will make vital reading and what is most important is that it is being published by CIMA.  Reputation has long been associated with the ‘softer’ professions such as public relations and marketing but it is time that its role is recognised at every boardroom table.  Because, no matter how good your performance, no matter what your growth aspirations are you will only be as good as your reputation.

In our next article to be published week commencing 15th November we will consider in more detail one of the components of reputation – identity.

For more information about Bodyproject and our Advanced Stakeholder Management methodology that helps organisations promote and protect reputation call 0151 709 2288 or e-mail nicktaylor@bodyproject.co.uk

Advertisements

Advanced Stakeholder Management aids recovery!

05/08/2010

“…If you grow slowly and strongly, you will be around for a long time…”

Edwin Booth Chairman Booths Supermarkets

Business has never been harder, but in some sectors there is an increasing understanding that the only way to recover and even survive is through continued investment and growth.

The Chartered Institute of Public Relations (CiPR) latest ‘state of the industry’ research reports a marked increase in PR budgets with professionals expressing confidence in terms of the health of the PR industry and growth expectations.

A host of areas are predicted for growth in the coming year, with key ‘ones to watch’ being online reputation management, crisis management and strategic planning.

Bodyproject, a niche consultancy based in Liverpool, that pioneers an Advanced Stakeholder Management (ASM) methodology, believes that those businesses that want to succeed and grow are continuing to invest to protect and promote their reputation.

Nick Taylor, owner of Bodyproject comments: “The strength of the balance sheet is clearly a major factor but more and more companies are understanding that the true value of their business is tied up in their intangible assets and intellectual capital.

“Those businesses that continue to invest and take a strategic approach to managing their reputation are also the ones that are expressing optimism that they can trade their way through the recession”

Bodyproject is seeing a great deal of interest in the ASM methodology from businesses that are growing, increasing employment, achieving more sales, reducing costs and demonstrably becoming profitable.

Nick continues: “I am convinced that to be successful in business you have to go beyond the traditional aspects of stakeholder management around the protection of reputation and brand.

“Our ASM methodology is an innovative strategy seeking to integrate the management of stakeholders into core business with visibility and control from senior leaders and board level rather than solely the preserve of PR, marketing and communications departments.”

Businesses achieving direct commercial advantage understand the essential elements of stakeholder relationships, including the development of a better brand image, additional market insight, increased flow of new product and service ideas, improvement of internal business processes, better insight into consumer behaviour, new marketing channels for company products and services, and early warning of potential risk and crisis.

Advertising – times they are a changin’

13/06/2010

“…What kills a skunk is the publicity it gives itself…”

Abraham Lincoln – former US President

Robert Green’s error will no doubt become the domain of advertisers as the inevitable ‘Danny Bakers 101 goal keeping bloopers’ and numerous other World Cup tosh makes its way onto DVDs and books destined for every boy’s Christmas stocking.  But the biggest advertising blooper ‘ever’ was committed by ITV who managed to switch in an advert for Hyundai cars at the very moment England scored their goal.

ITV have apologised blaming a transmission error.  What on earth does that mean?  Of course there was a transmission error as watching choreographed Hyundai cars pretending to play football with a giant ball, at the very moment Steve G scored, was not what the nation had switched to high definition (HD) TV for.

For Bodyproject. as a communications pundit, there are numerous points to discuss following this match.  First of all, how does commercial broadcasting stand up to licensed broadcasts from the BBC.  Second, whilst HD is technically and visually superior, it does have a significant transmission problem and third, the woeful excuse from yet another major corporate entity, intent on ‘spinning’ rather than explaining honestly why it happened and what it is doing to prevent a reoccurrence.

The fact is commercial broadcast remains a pain.  Watching any sport on channels such as Eurosport and Sky Sports is challenging.  Try tennis when the same idents and woefully painful adverts are shown again and again between every set or between every round in say boxing.  It is almost brain washing and, if anything,serves to put you off the product.

The World Cup of course is ‘big bucks’ advertising and the super brands are in town.  But it doesn’t matter how clever Adidas is combining a classic film with cameos from Beckham, Noel Gallagher and Ian Brown; it is still an intrusion when played just before the teams walk out, just after the national anthems and for ITV, in error,  as the key goal is scored.  For me, there needs to be a balance, and at the moment it isn’t being struck, as most comment I am picking up is that people much prefer the BBC for its uninterrupted coverage – which is not great for the brands sinking all this money into promoting their product!

Equally ITV’s HD switch on has all been to coincide with this world showpiece event, so for them last night was as big a disaster as that of Robert Green’s faux-pas.  Their explanation is woeful and to my communication colleagues at the broadcaster I say wake up and hold your hand like Green and apologise properly.  You are not Toyota or BP shying away from reality – face up to it.

HD is suffering teething problems namely in that it cannot regionalise so I sometimes am sat in Liverpool having to watch London’s weather (yes we are still south east centric in the world of TV transmission).  It also shares channel feeds and so watching Rafa Nadal playing at Queens is suddenly interrupted for fifteen minutes to allow BBC2 to join in, credits and punditry an all, leaving me frustrated at losing the match I was enjoying.   At the moment it is all over the place.

I can say that at this time, I and the rest of England, cannot wait for the Algeria match.  Mainly as it may still be at risk from transmission interruption but it will be certainly free of Hyundai interruption.

Marketing in a sceptical world

16/05/2010

Spieler – a Market Trader who tries to convince a customer in all manner of ways that a product is worth buying

Extract from the Market Traders Phrase Book

Every Sunday in Liverpool, Stanley Market is thronged with traders and punters and has the most amazing array of goods.  What always fascinates me is that even in 2010 some traders are still pedalling magic ‘shammy’ (chamois) leathers or miracle mops or conducting meat auctions.   “For you, not £20, not £15 but £5 and I will throw in half a dozen sausages!”

You would think in this modern era that such selling would have had its day.  Surely selling has become far more sophisticated and such methods are transparent and as dubious as the world of scams with e-mails from Africa bestowing riches upon us in exchange for our bank details, financial consultants selling duff policies and numerous people willing to take our money and run.  You would hope that the regulators of marketing, advertising and PR would protect us from anything approaching the definition of a scam. However, even the most experienced marketing person can be subjected to some very interesting selling techniques that raises questions about my profession – marketing.

Business owners across the land have been puzzled by a direct mailing consisting of a torn newspaper page with a handwritten Post-it note, which says “Hi, I saw this and thought you’d find it useful – he’s really good! J”. The page arrives in a plain white envelope, which appears to be addressed by hand, with a second-class stamp attached.

It’s a compelling communication and makes a ‘free’ offer that is too good to miss.  Except, like anything, one starts very quickly to suspect there is something not quite right.  This particular mailing comes from marketing expert Chris Cardell and is certainly causing a stir as it has raised fundamental questions about his methods and has somewhat backfired upon him.

The mailing has landed him with a referral to the Advertising Standards Authority (ASA) and their adjudication makes sober reading – http://preview.tinyurl.com/y8xhtmz

For me, the Cardell approach is worth looking at.  Many of his materials, thoughts and techniques are fascinating although his brash and somewhat arrogant approach is not to my liking (If you want to see him in action selling to you from a luxurious location then enjoy this – http://tinyurl.com/2wvavxu).  The problem is where to ‘draw a line’ in communications and to determine at what point Cardell’s methods push  beyond the boundaries.

Of course, read the direct mailing cutting and one begins to fast see through the gushing copy.  The handwritten post it note is clearly misleading as actually there is no person that knows you called J who may have sent this mailing and the whole presentation from the stamp, postmark and hand writing is all aimed to provoke certain actions without telling you this is actually just a marketing device.

For me, Cardell has stepped outside the rules and the ASA adjudication establishes this.  It has also given him an interesting challenge as he is a disciple of Google and evangelises their tools, except now his name in their search engine returns with the word ‘scam’ which is hardly great for a guru of advanced internet marketing.  It will be interesting to see how he responds .

Bodyproject feels distinctly uneasy about the reputation the likes of Cardell bestows on our industry; but at the same time he has something to offer that is unique and ultimately compelling.  There is also a perversity in me writing this as I have subscribed to his free offer and thus offered my e-mail address to his clutches, but in mitigation I have done so for professional research reasons as I am sure you will understand!!!!

Say it as it is

05/04/2009

“…It is a legislative requirement not to smoke in this bus station…”

PA announcement heard in St Helens Bus Station

The Bodyproject stakeholder management methodology looks closely at the use of language within communications and we never cease to be amazed at the way some organisations do everything they can not to use direct words.

I recently spotted a display sign at Wigan train station saying the train originates here!  How about the train starts here.  The quote at the head of this page is a case in point.  Where a simple smoking is not allowed or please do not smoke would be fine instead a grand word such as legislative is used.  What does that mean and can the average user of the bus station even understand it?

Smoking of course is an emotive topic and so is telling someone to stop or that they can’t do it.  The NHS at the vanguard of stopping smoking can’t quite bring itself to say stop smoking and talks about smoking cessation.  What is that?  I also heard the use of the words discontinuation of smoking.  Interestingly it is often the public sector that uses this sort of language.  Commercial organisations, in this case the makers of Nicorette patches use the straight forward quit smoking as a call to action.

The main point we at Bodyproject try to get over is to keep things simple and communicate so the person you are trying to get the message to can understand it.  If you want someone to stop or quit smoking then say it.  Asking them to participate in cessation or discontinuation as it is a legislative requirement might just not work.

To find out more about the Bodyproject stakeholder management methodology, our seven rules of effective communication and our thoughts on language please get in touch through the contact tab on this site.

The reality of TV

18/11/2008

“…One is a TV star, ‘forced’ to eat bugs to win meals.  the other is a Zimbabwean, forced to eat bugs in order to survive.  We don’t mean to preach, but…sometimes, the injustice of this world just sticks in your throat…”


Front Page Metro Newspaper 18 November 2008

Reality TV is dominating the tabloids, broadsheets and the radio chat shows.  For X Factor and Strictly Come Dancing, the issue is the public vote and the tussle between self made experts who are assessing quality (even though their view is subjective and personal) against a public that seems to be assessing everything but quality.  In truth, none of it matters, it is just great light entertainment and ‘fodder’ for us all to debate to get us through the grim grey days of Autumn.     

However, the arrival of our latest annual reality event: I’m a Celebrity get me out of here is posing much more serious questions about our values.  The fact that we are entertained watching so-called celebrities eat grubs whilst elsewhere in the world children are having to do the same to survive is hard to stomach in every sense.
The disaster that is unfolding in parts of Africa is not unusual, but it does challenge our society and its values.  In fact 2008 is fast becoming a real year of reckoning where we are really seeing very transparent challenges about our values.
On Sunday I went to see the latest James Bond movie and was presented with a film with little plot, a poor script but littered with a world of opulence, greed and violence.  But what really struck me was the adverts shown for an inordinately long time before the main picture.  Clearly the account managers with brands aligned to Bond are living in a very different world from me.  The way cars, watches, perfumes and video games were presented was deeply disturbing given the current state of our world.  Sure, cinema is escapism and I enjoyed being out on Sunday but we communicators and in particular advertisers and those producing media such as film, TV and radio need to be very careful to challenge poor values and lead in ensuring we challenge the injustice pointed out by Metro newspaper (see quote above).
Reality TV is playing a dangerous game.  The dubious X Factor editing portraying hopefuls on the basis of feeding their children, commemorating their recently departed or just being little, vulnerable with a sore  throat from Blackburn is beginning to wear thin.  The nasty put downs by the drama queens on Strictly Come Dancing is also wearing thin and provoking a public reaction.  But even with Ant and Dec steering the ship, the way the isolated pampered ones react to their jungle trials may just provide the one that provokes serious debate over values in the coming weeks.
Advertisers and media companies brace yourselves as the reality is times are changing.

The Big Issue

03/11/2008

“…A brand is a set of rational and emotional perceptions in the mind of the customer…”


Davide De Maestri – International Coaching Academy

Next Monday across the North of England there will be a change in the printed media that will be anticipated with some trepidation.  Of course media is always transforming and moving forward whether that be the introduction of colour, resizing from broadsheet to berliner or embracing the web; but this is a change that will have less of an impact on the owner and more of an impact on the vendor.


The Big Issue in the North is unveiling a new look – in their words it will introduce a magazine that is “cleaner, more coherent and stylish.”  So much for the brand speak but to be fair to the Big Life Company, the group of companies and charities that publishes the magazine, the change is fundamental.

Big Issue sellers are working and not begging and selling the magazine on the streets is not easy.  Not only does the vending taking place in all weathers but it relies on persuading people to buy the magazine and in this respect the look and content is all important.  A conversation I had with a vendor a few years ago highlighted this – from his perspective the cover image meant everything – a top celebrity or stunning cover image helped the sales.  So any change to the look and feel of this publication is important as for most vendors the money they earn from sales is their only source of income.

The problem is that many people just don’t understand the Big Issue and the Big Life Company hopes that this redesign will remind people of its purpose.  From my point of view the Big Issue in the North is vital reading and a must buy – not just because it helps homeless people earn a living, but because it is one of the best edited and written magazines I know.  Its content pushes boundaries with incisive writing and stimulating content, not just about homelessness.

To this end I am looking forward to the redesign, it is one that the Big Life company will have carefully considered, and I hope everyone who reads this will ensure that they go out and buy a Big Issue today and every week after.