Without trust you can't even give it awayIf we ever needed a reminder of the power and value of brands and reputation, and the importance of looking after them, then 2004 has given it to us in spades.
In a recent experiment where they tried to give money away Barclays Bank found no takers for their free £5 notes. The bank placed a sign in the window of its Croydon branch inviting passers-by to walk in and collect a fiver. Nobody did. Asked why, they said: “it's a bank - there must be a catch”.
There is no bigger brand than Microsoft, but even the most powerful company in the world has to be careful who it ignores or offends. When the time came to mobilise support against the legal battles it has faced in the US and Brussels it found it had few friends and little protection against the court mauling it received.
Anyone can suffer a product disaster. Perrier, the bottled water, was contaminated with Benzene some years ago. The company apologised swiftly, and removed it from shelves all over Europe. Within a few months sales had recovered, its reputation strengthened by the way it had handled the crisis. Contrast that with the public relations disaster over Dasani, the bottled water from Coca-Cola. The revelation that its product was plain old tap water from Sidcup in Kent was a blow. The subsequent news that its purification process had added cancer-causing chemicals caused the entire product to be withdrawn from British shelves. Financially it will make little difference to Coca-Cola in the short term, but it dashes its hopes of building up sales in a growing sector that is threatening its core sales of fizzy drinks. What ought to seriously worry the giant is the ill-concealed glee which greeted the failure.
Attracting potential employees is hard work and it can be expensive. Waiting for jobs to be filled or accepting second best is even more costly. Recruiting is a beauty parade where reputation and strong brands come into their own. A survey of more than 12,000 business engineering and IT students in the UK, Germany, France, Spain and Italy discovered that L'Oréal was among the top selections overall in the five countries. It was first with nearly 21 per cent, with BMW in second place on 19%. “You can't separate the employer's image from the product,” said Trendence, the company carrying out the survey.
Reputation is what makes consumers, employees, suppliers and shareholders choose and stay loyal to you, rather than your competitors. It buys you time and understanding to put things right when they go badly wrong.
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