How do you put a price on reputation?
Posted by: Alistair Clay | 10.06.15

 

“It takes 20 years to build a reputation and five minutes to ruin it. If you think about that you’ll do things differently.”

The words of legendary US investor Warren Buffett, who knows a thing or two about what success looks like.

Never before has the link between reputation and a businesses’ bottom line been stronger.

The rise of the Internet, social media and 24-hour news coverage has brought unprecedented levels of transparency and scrutiny to almost all areas of life – big business included. The age of secrecy, privacy and deference is over – reputation is king.

In recent weeks we’ve seen several high profile examples of the power of reputation, from the tragic to the trivial.

In May Thomas Cook left many comms professionals dumbfounded when the firm refused to apologise for its connection to the tragic deaths of two children in 2006.

After a massive public backlash, and following days of negative headlines which included the revelation that the company had accepted compensation money from the hotel in which the children had died from carbon monoxide poisoning, Thomas Cook finally got the message and donated £1.5million to Unicef and made that all important public apology.

Perhaps the legal advice was ‘admit no liability’ for fear of triggering a significant lawsuit. But was that really any more of a business risk than appearing cold, out of touch and uncaring to existing and potential customers over the death of two children?

More recently Olympic Gold medalist Mo Farah has found his name being ‘dragged through the mud’ following a BBC Panorama investigation into his coach Alberto Salazar, which alleged Salazar used illegal doping practices with other athletes.

Out of loyalty to his coach, Mo has so far decided not to cut ties with Salazar and wait until the full facts of the case are known.

A noble approach, perhaps, but in the post-Armstrong era even the slightest hint of a connection to doping could be enough to harm Mo Farah’s career.

And finally, Matisse – the Britain’s Got Talent Dog/Dogs. It turned out the winning pooch had a stunt double and the voting public cried foul!

The reputation of the show, and it’s Svengali Mr Cowell, took a nasty blow. Will people vote in their millions again after this shaggy dog story? If they don’t the advertisers will soon press their red buzzers.