Reputation Garage

We've Moved...Here's Our New Web Address

2009-12-11T10:38:00.004-05:00

To Our Readers:

We've renovated the Reputation Garage site and moved the platform off Blogger to WordPress. Find us here:

www.reputationgarage.com

If you currently get to us through our Blogger URL via a reader, email notice or other way, please go to our new site and re-subscribe.

We look forward to connecting with you there!

Jarvis

Our New Site - Coming Soon

2009-11-13T11:45:00.001-05:00

Well it's happened. We've become a business consultancy. Readers of this blog know that the Reputation Garage has operated for some years as a "garage band" of chief marketing officers, agency types, training, and performance experts. Our mission has been to create new ways for organizations to build trust and improve reputational performance. As an open source collaborative, we've been posting new ideas, best practices and research on this blog since 2007.

Our apologies to our readers all over the world for having neglected this blog over the past few months as we've concentrated on establishing the new consultancy. But good things our on the say. Our new site will be up in another week. We look forward to connecting with you there!

All best,

Jarvis

The "All-Digital-All-the-Time" Agency Network

2009-11-13T11:43:00.005-05:00

Andrew Jaffe

Maurice Levy is perhaps the most under-reported, undervalued person in advertising. In the span of 20 years, he has taken a smallish European network of agencies based in Paris and built it into a colossus.

Levy's Publicis Groupe today owns Publicis, Saatchi, Leo Burnett, Fallon, 49% of Bartle Bogle Hegarty, Droga5, Starcom, Mediavest and now the digital giants, Digitas, the largest digital agency in the world, with Razorfish and VivaKi, Denuo and on and on.

But though we hear frequently from Martin Sorrell of WPP, Michael Roth of Interpublic and occasionally even from press-shy John Wren of Omnicom, the American business press rarely features Levy. When it came time for Business Week to do a cover story on advertising's current problems, it bypassed Levy for the flamboyant (“Love Notes”), Australian-born CEO of the Saatchi network, Kevin Roberts.

One reason Levy has quietly outdistanced his rivals in terms of turning in solid, quarter-on-quarter revenues and profits, is that he saw the shift coming 10 or so years ago and began buying up digital assets. Today 25% of Publicis Groupe revenues come from digital advertising and media services. Levy saw the future, bet the farm on digital and now is worth careful watching.

A week ago MediaPost.com reported that Levy plans to transform Publicis Groupe into an “all-digital agency.” “We have very good numbers for growth in digital,” he said. “And this is something which is offsetting the decrease of some other activities.”

I've been trying to figure out what Levy means by “all-digital agency.” Was he talking about just letting Digitas and his other digital assets grow and prosper, or was he saying that all his properties were going to become “all-digital?”

And then I started thinking about what that phrase would mean if Levy implemented this strategy across his three big traditional networks, Leo Burnett, Publicis and Saatchi.

If these great monoliths dared to call themselves "All Digital" would they jettison the layers of people still trying to shoehorn clients into big branding campaigns played out in TV, print and radio?

Or did Levy simply mean that he was going to get his agencies thinking digital first, coming up with digital solutions that then could be applied to other platforms and media?

Maybe "All Digital" a new language in branding-so all he was talking about was gaining universal literacy in the new mother tongue. Or is "All Digital" a strategy? Or the natural evolution of where the agency business is going?

When Business Week in the Kevin Roberts' cover story noted the drop in revenues at Saatchi and asked Levy what he was going to do about it, he responded that he wasn't going to do anything about it-that that was Kevin Roberts problem. Quoting Business Week:

[Levy wondered] if a creative agency like Saatchi should continue to manage a client's branding efforts. Perhaps the digital specialists should do it….Levy expresses nothing but affection and admiration for Roberts. But he warns: "It is no longer necessarily the creative agency dictating what's best for the client."

Here I think Levy, visionary that he is, is pulling our leg. Saatchi has a number of major clients-led by global duties on Toyota. Until Toyota is ready to demand an “all digital agency” - I don't think Roberts is ready to change its spots - nor is Levy about to demand it.

Ah me, sometimes we can see the future so clearly. But we have to wait months or years for what we see in our crystal balls to become reality.

Everyone is changing gears as fast as they can, led by clients who helped Internet advertising grow 37.5% in the second quarter of this year. But when and if Toyota is ready to make its big move, say transforming Prius into a separate division rather than a couple of hybrids, will it rely primarily on digital to make the change?

I think not.

I think we are still in the nether world where it's going to take us 10 years or so to resolve these issues. Digital may be a language, which is becoming second nature to all of us. But it may not be a strategy. The strategy still is to create in consumers a need, affinity for, and trust in a brand. We know, then, that the Prius must act a certain way over time - and respond to consumers wherever they connect with the brand, either in an ad, in a call to customer service, in the showroom, on the Web, and (the one Detroit forgot) while on the road.

I think where Levy is going is similar to what Bill Gates did at Microsoft, when he told his charges years ago that from now on everything at Microsoft would be built to live on the Internet. But wait, Windows 7 still comes in a box. You still can buy it in a store (in fact soon you're going to be able to buy it in a Microsoft store). Sure, it must be available on the Web, and everything it does must easily move back and forth within the cloud to other users. But Gates' destination hasn't been reached quite yet.

Setting the right destination and figuring out how fast to go there remains the single most important real-life issue for agency heads, especially now as they re-engineer their agencies and budgets for 2010. Unfortunately there are no hard answers. So they can either follow Levy, and seek to make major changes now, or take baby steps and let the future take care of itself.

All Digital, to me, is an intriguing concept. But tens of thousands of jobs, hundreds of millions of dollars in revenue, and the future performance of the world's most important brands depend on each agency head making the right call.

Sometimes the hardest trust issue of all is the future.

About Andrew Jaffe

Reputation Garage Trustmeister Andrew Jaffe is the former executive director of The Clio Awards and a former editor of Adweek. His latest book "Casting for Big Ideas: A New Manifesto fo Agency Managers," published by Wiley, lays out why big agencies are slowly dying at a time when new kinds of smaller firms are giving marketers the relevancy and performance they need in today's marketplace.

Why You must Offer Customers a Guiding Oar in Today's Environment

2009-05-14T14:39:00.005-04:00

By Britton Manasco

What does it take to earn the trust of key decision-makers and influencers in today’s turbulent economy?

It’s no longer simply about product features or service capabilities. When your customers are making a significant commitment and putting precious dollars (even their own business) at risk, they expect more than ever before. They want a helping hand and a guiding oar. They aren’t just investing in your solutions; they are investing in a promise of superior returns and best practice. They are investing in your company as a leading advisor and authority who is ready, willing and able to help them navigate a challenging period in economic history.

That is why buyers will increasingly gravitate towards thought leaders.

Cisco Systems, the $40 billion maker of networking systems and solutions, represents a great example of this point. The company managed to eclipse competitors such as Juniper Networks and Alcatel-Lucent by thinking of itself not just as a technology company but a “leadership consultancy.” John Chambers, the firm’s CEO, contends that the insights Cisco has gained by networking its own business can now be shared with its clients to help them drive growth. “We’re really talking about business process change,” he says. “And since we have done it for ourselves, we can show others how.”

Over more than a decade, Cisco has actively promoted its ideas about how to leverage networks for business success. It has underwritten ground-breaking research. It has published extensively. And its executives, particularly Chambers, have been visible proponents of network-driven business. Such efforts help to set Cisco apart from other players in the networking sector while opening up new markets – such as telepresence and web conferencing – for the company to penetrate. The company’s thought leadership positions it as a respected authority as opposed to simply another vendor.

So what does it take to become the authority in a marketplace and earn the trust of one’s prospects? As the experience of respected players such as Cisco, SalesForce.com, McKinsey and FedEx suggest, there are several steps once must take to become a thought leader. Among them:

1. Identify issue(s) that you wish to own and content that helps customers.

You can’t be an authority on everything. It’s critical to determine the issues that matter – or will matter – to the customers you intend to engage. SalesForce.com recognized the growing expense of software implementation and integration as a growing source of dissatisfaction. Note that the issue was framed from the point of view of the buyer’s problem as opposed to the seller’s product features. The company’s CEO, Marc Benioff, became the voice of a buyer backlash and promoter of a new approach that turned a painful capital expense into an operational one that is comparatively easier to justify and implement.

2. Invest in the development of solid, research-driven insights and perspectives.

The key here is to actively engage in the research necessary to stay on top of market trends, customer concerns and new business opportunities. Consistently cited as the most prestigious and influential consulting firm in the world, McKinsey & Co. recognized the wider potential of investing in thought leadership back in the 1970s and 1980s. It would produce top research on management topics and then, present it as scholarly articles in the Harvard Business Review or thought-provoking editorials in the Wall Street Journal. Other research and insights – such as those produced by the McKinsey Global Institute – are presented to clients and prospects in its own influential publication, the McKinsey Quarterly.

3. Develop a distinct, high-level position/message that resonates and is authentic.

Companies must move beyond what they sell to focus on the results they deliver and their thought leadership is a powerful way of conveying this perspective. Cisco offers another interesting example here. The company recognizes that “networking technology” is a little cold and mechanistic on its own. With this in mind, it has coined the umbrella term “human network effect” for its marketing and customer outreach efforts. The concept not only humanizes the company, but reflects the fact that the real winners are people and that its success stories have a distinctly human face.

4. Leverage your insights in multiple channels.

FedEx's thought leadership marketing program, known as “Access,” reaches C-suite decision-makers through multiple channels including executive events, web site initiatives and direct mail. The company also publishes a custom magazine, Access Review, to reach its targeted customers. The program is designed to show FedEx's leadership role in the global economy. Grounding its point of view in solid research, FedEx commissioned the independent, nonprofit research firm SRI International to study and measure the movement of goods and information around the world. Each year, the company releases a new report ranking 75 nations based on nearly two-dozen indicators of access to information and physical goods.

As the premium for customer trust continues to rise in the coming years, companies will increasingly embrace thought leadership as a means of earning and strengthening it. Buyers now expect their suppliers and solution providers to illuminate the path forward and guide them through demanding decisions. By meeting this profound need, thought leaders take the steps necessary to become market leaders.

Britton Manasco is a contributing "trustmeister" to the Reputation Garage and founder of Manasco Marketing Partners, a firm that specialized in thought leadership strategy and execution. He also produces the blog, Illuminating the Future: How Thought Leaders Become Market Leaders.

Recession Landmines Do Not Discriminate: Proceed With Extreme Caution

2009-03-27T23:33:00.011-04:00

by Stephanie Fierman

A recession landmine is like a real landmine. It’s going to kill or maim whomever steps on it. The guilty, the innocent… it doesn’t matter. A landmine does not discriminate. You just explode.

And so it was with a recent Pepsi ad for G2 (low-calorie Gatorade).

When you watch the ad, you can see what Pepsi was trying to do almost immediately, then BLAM: it spins around like Linda Blair’s head and everyone’s covered in slime. This means Pepsi now have something in common with AIG, but more on later.

The shots move back and forth between NBA player Kevin Garnett and a normal, suburban-looking guy - also named Kevin – who loves to swim. The voiceover also switches back and forth between the two men, and herein lies the problem. In trying to write a Nike-reminiscent “athletic striving” ad, the supposedly inspiring statements appear to mock and insult people who have lost their jobs or are otherwise suffering due to the economic crisis. See for yourself (if you cannot already see the ad on your screen, click HERE).

When I first heard about this controversy, I’ll admit it: I really, really wanted to support Pepsi. Pepsi's a great brand. But this spot has issues.

The lines are being called "arrogant and insensitive" and a "cruel" "slap in the face":

Garnett: “I’ve never been handed a pink slip…” “I’ve never had to tell me wife ‘We can’t pay the mortgage.’” (Kevin “The Big Ticket” Garnett has a $24.75 million contract with the NBA)

Normal Kevin: “I’ve never had to fill the holes in my sneakers with cardboard.”

Garnett: “I’ve never used the backstroke as a ‘coping mechanism.’”

And with these statements, my professional persona disappeared and I became a person who can’t pay for food, who doesn’t have health insurance, who has to drop out of school. The sneaker comment struck this trustmeister as particularly startling. Normal Kevin moves us swiftly down the road, past unemployment, with homelessness straight ahead.

How did Pepsi end up in this place? The financial services companies got into trouble for how they handled their (financial services) business. They made endemic mistakes, in their own backyards. This energy drink runs right into a buzz saw for no reason at all.

And so let us come back to how Pepsi now shares something with AIG. Both companies failed to grasp how people are feeling today… how “business as usual” no longer applies. 1.3 million children in the United States are homeless at some time every year - and that was before the recession started. One could assume that some of these children must use cardboard to fill the holes in their shoes.

If you think this is overly dramatic, we would respectfully suggest that you could step on the same landmine that Pepsi and the banks did, either while you’re on the job or chatting at a cocktail party. This is a sea of vast, vast pain.

Personally, I am counseling clients today to look hard at the need to advertise right now. If you are running ads, make sure they are seen and tested with a much broader swath of consumers and experts - people who may not be in your target audience. Put the ads through the mill. Have linguists and child advocates and food bank directors mull every word, every image.

Is all this fair? Fairness is not at play; raw nerve endings are. We are all in the business to sell, of course, but at what cost at this very moment? The news and current events are swinging wildly from one day to the next: are you comfortable deciding what messaging won't spark an undesirable (albeit inadvertent) reaction? Think long-term. If you’re not 100% secure in next week’s flight, cancel it. Because getting this wrong could negatively affect your brand’s reputation for years, if not a lifetime.

#1 In Our Series for Keeping Customers In Tough Times (Nicolette Wuring)

2009-03-20T15:11:00.003-04:00

TIP 1: In Today’s Low-trust World Your Promises Are Much Less Likely to Be Believed. Focus Instead on Improving Your Ability to Deliver Meaningful Interactions With Customers that Build Trust.

A cable company in Europe launched a re-branding soon after a roll-up of acquisitions by a group of venture capitalists.

The investors demanded that the re-branding take place almost immediately. This was not only premature and meaningless to employees and customers, it proved harmful. Premature because on the inside this organization was far from one company. Harmful because important organizational, operational and cultural objectives necessary to sustain the rebranding hadn’t been met. Worse still, mistrust and insecurity could be found throughout the organization in abundance. Employees were insecure about retaining their jobs after the roll-up. They were uncertain about how to represent the new entity. And for many loyalties remained rooted in the company they used to work for. Customer-facing policies and procedures were not in place yet. Systems had not been integrated.

Disregarding all this, the investors demanded that management forge ahead with a re-branding. The effort introduced a vision for a completely new DNA for the culture. It painted a picture for the outside world of a company that sets itself apart by truly listening to its customers and one that enters into a personal dialogue with you. The brand image was warm, engaged, truly caring, attentive and accessible. A company that makes complicated things simple. Boring things more fun. Dishonest things honest.

And the impossible, possible.

Now what do you suppose a group of confused, fearful and uncertain employees of this company felt when this re-branding hit the above- and below-the-line communication channels? How do you suppose their customers felt when confronted with completely disengaged and confused employees who were struggling with legacy operational issues that made it impossible to deliver on the brand promise? What do you suppose was the media coverage on these results, or the comments posted by customers and employees in online social environments?

The results were very bad indeed. The company lost employees and customers, prospects turned to alternatives, and every Euro invested in the brand campaign was largely wasted. Had this disaster taken place in the current environment, where companies can ill-afford mistakes, things would have been even worse.

Learning: Job #1 as a starting point in keeping customers is to deliver on promises. Lead with trusted actions and only then back them up with brand imagery and communications. The people you interact with as a company, especially your employees and customers, make or break many a brand’s reputation. Never make promises or create expectations they cannot live up to!

Nicolette Wuring is an internationally acclaimed and awarded Customer Advocacy thought leader, speaker, author and boardroom advisor to Fortune 500 companies. She is the founder of Customer M@nagement Services, www.customeradvocacy.biz, a strategic consulting firm dedicated to helping business conceive of increasing their economic value by creating emotional connections and trust with their employees and customers.

Financial Firms Must Break From The Pack To (Re-)Establish Trust

2009-03-06T19:22:00.005-05:00

by Stephanie Fierman

Here at the Garage, we believe that a more measured approach to bank and investment advertising is probably a positive development.

After all, hadn’t all the ads begun to look the same? Could every company and every investment have possibly offered the best return, and the most Morningstar stars, and the biggest retirement homes in paradise? Unlikely. Outside of just a few stalwarts, such as Vanguard with its slow-and-steady point of view and Bogle-esque approach, many of the siren calls in the newspaper, on television and online had all taken on a surreal and undifferentiated patina. That’s not effective.

Now it appears that all the bulls have stampeded in the opposite direction.

Consider the list of firms advertising in one issue of The Wall Street Journal this past week, along with text pulled verbatim from their ads:

MORGAN STANLEY: “To find the smart investments today, you need to be world wise.”

MERRILL LYNCH (aka Bank of America): “Seeing clearly. Acting confidently.” “With personal insight into your goals and an understanding of the market…” “…Find a smart place for your money.”

CME GROUP: “Rise Above the Risk.” “For more than a century CME Group has provided competitive, transparent and safe markets.” “…protect customers and ensure financial integrity by guaranteeing the performance of every transaction on our exchange.”

TD AMERITRADE: “There’s never been a better time for a second opinion.”

FIDELITY: “Guaranteed income you can live with.”

GLENMEDE: “There’s no substitute for safety and stability.”

PNC: “…It’s also a way of doing business that has strength and stability at its very core.”

Safe, smart, transparent and guaranteed: these are the adjectives to which financial firms are now rushing as they adjust to our new economic circumstances. The problem is – well, it’s the same problem as before, isn’t it? If your messages are entirely undifferentiated from those of your competitors, they essentially melt into one and stakeholders become unable to distinguish one from the other.

If the Garage held a focus group tonight, and scrambled the names of the above firms and the quoted text, we would challenge any budding Trustmeister to re-match the elements correctly.

And killing an ad’s effectiveness may, in fact, be the most benign result. Worse? Just as when every firm claimed great returns – which turned out to be untrue and, in some cases, backed by unscrupulous actions – everyone now shouting about safety looks equally as unlikely and untrustworthy.

All of these brands are more and are capable of doing more: the “more” being the hard work needed to determine exactly what it is about the brand that is unique and distinguishable from the competition.*

Without doing this work, going out with a “safety” message isn’t safe at all.

* Many of the above firms may not technically be competitors, but that’s an insider’s view. To the public and the U.S. Congress, too much of the same becomes one shapeless – and dubious – perception.

A version this post was first published on http://www.stephaniefiermanmarketingdaily.com/.

Customer Service: Your lifeline in the Crisis (Nicolette Wuring)

2009-02-28T08:33:00.007-05:00

Editors Note:

General Electric’s Jeff Immelt recently noted that the global economy is not simply undergoing an economic downturn, but an emotional, social and economic reset.

Is your management team feeling panic about that? Applying the thinking developed by the trustmeisters here in the Reputation Garage can help. If Mr. Immelt is right, and we think he is, your management team will need to radically change its playbook. And not only have the rules changed, there is not yet a lot of clarity around what the new game board looks like.

Below our newest “trustmeister,” Amsterdam-based Nicolette Wuring, offers thoughts as this relates to her specialty: customer advocacy, operations and service. In a follow-up piece, Nicolette will offer tips for keeping customers in this rough and tumble environment.

------------------

As your management team works its plans to manage the current downturn, it’s worth remembering that we are all at once suffering a financial market crisis, a world economic crisis, a management crisis, an ethics/values crisis, and a crisis of changing consumer purchase and lifestyle priorities.

First and foremost this crisis is about trust, and trust is earned and lost by people. Over many years businesses became so short-term profit-focused that the managers, employees and even customers became just variables in the profit equation, traded off as assets or liabilities, not as the human beings they are. “Customer right sizing” is but one of hundreds of examples of this. In too many cases the “right” was for profits, not the customer. And the customer knew this and promptly withdrew credits on deposit from the company’s earned trust bank.

Or consider the CSR paradigm “People – Planet – Profit” that is widely promulgated here in Europe. Most corporations have not only been short performance on the planet-side, but also on the people-side. This has accelerated the profit collapse.

The BIG question for industries and companies is how to become profitable again? The answer for 2009 is that you must get much better at finding ways to keep your customers by earning their trust. Relationships develop between people, not between “corporations” and “customers.” That’s where the customer facing people in organizations enter into the equation.

A good starting point is to answer the following questions:

1) Do we have a strong level of “earned” trust among our customers?

2) Can we quantify it?

3) Do we have strong managerial and operational competency to build trust through our customer-facing operations?

4) Have we set the right goals to drive trust, and are the right metrics in place to track progress?

Customer Service, Customer Care, Customer Operations, you know, all those people who manage the trust you build in your business cannot be treated as dehumanized robots, as ‘human doings’, managed at a task level for their quantitative results. One of management’s top priorites right now is to boost their role as the window to ‘the corporation’, representing the organization. The bottom line? You must find ways to help your organization to better interact with customers as human beings. That is how you will earn trust and improve your relationships.

Her latest book Customer Advocacy: When You Care People Notice is available on Amazon.

In Toys We Trust (By Jarvis Cromwell)

2009-02-12T15:37:00.005-05:00

When my brother sent me an Amazon link to Playmobil’s Security Check Point toy I was sure this was either a joke or a phishing scheme.

Nope. It’s real. Buy it here. Cost of the toy: $62. Customer reviews: priceless.

Welcome to planet earth circa 2009. If we had to pick a symbol for the low-trust headwinds blowing a destructive chill around the globe, this might be it.

Needless to say some Amazon customers are having fun with this one, as in this example:

I was a little disappointed when I first bought this item, because the functionality is limited. My 5 year-old son pointed out that the passenger's shoes cannot be removed. Then, we placed a deadly fingernail file underneath the passenger's scarf, and neither the detector doorway nor the security wand picked it up. My son said "that's the worst security ever!". But it turned out to be okay, because when the passenger got on the Playmobil B757 and tried to hijack it, she was mobbed by a couple of other heroic passengers, who only sustained minor injuries in the scuffle, which were treated at the Playmobil Hospital.

Or this one:

Do they make a Playmobil GSE Mortgage Set, complete with little plastic Freddie Mac and Fannie Mae CEO's, ...and maybe little plastic Congressmen that get really rich, really fast when they are in charge of overseeing little Fannie and Freddie CEO's? ...Oh, ...and maybe an armada of little plastic attorneys to protect the little plastic Congressmen and little plastic Freddie and Fannie CEO's.

Other customers are disturbed:

“It's disturbing because the toy teaches children that fear and paranoia is normal. That it's right and correct for society to distrust its citizens the minute they buy an airline ticket…. It erodes trust between citizens, replacing it with trust in a government entity (HSA)--a government that of late has done quite a bit to suggest that it in no way deserves that trust.”

Unfortunately there is a lot to be disturbed about as a parent in today’s world. Not just the prospect of terrorism and the loss of childhood innocence, but also trust in the safety of the toys themselves. More than 20 million toys manufactured in China were recalled for lead paint and other hazards in 2007 — 138 recalls in all. 2008 was better, but there were still over 70 recalls. We note that Playmobil toys, manufactured in Europe, haven’t had any problems.

A quote from the New York Times in 2007 sums it up:

“Nobody wants to be a paranoid parent,” said Ms. Gumbinner, 39, of Brooklyn Heights, who works as a creative director for a Los Angeles advertising agency and is a co-founder of the site coolmompicks.com. “I mean, where do you draw the line between cautionary and crazy?”

Will Sponsors Throw A Life Line To Michael Phelps?

2009-02-02T19:42:00.013-05:00

by Stephanie Fierman

Well. Well, well, well. What can one say about the picture of Michael Phelps smoking marijuana from a bong?
Yes that’s right kids, your gold-medal idol is smoking grass. Weed. Ganja. He’s inhaled. And it looks like he’s done it before, too.

Having moms ourselves, The Garage shudders to think what Phelps’ mother may have said in reaction to the news. And if your Phelps’ reps at Octagon, you've started bailing water. Fast.

Phelps has issued a statement and apology using the “I’m young and dumb” approach and, as Fox Sports is already reporting, this event is likely to fade in the memory of the public. The question is whether sponsors will be willing to help mend his reputation as quickly.

Kid-focused McDonald’s and Kellogg’s Frosted Flakes, for example, have both counted on Phelps to project a wholesome, healthy All-American image. Maybe Phelps could just alter his pitch for McDonald’s a little bit: “Duuuude! After I smoke, I get, like, the wicked munchies. A Big Mac totally hits the spot.” Yikes.

Chances are good that Phelps’ fortunes will survive long-term if this side of him never sees daylight again. But if there's more to come – if this episode turns out to be only Strike 2 following his arrest for drunk driving in 2004 – his sponsorship potential may not recover for decades, if ever.

A version of this post was originally posted at www.stephaniefierman.com.

Changing Media Trustscape Part 4

2009-01-31T13:10:00.002-05:00

By Jarvis Cromwell

We've written before that the model for being a trusted source of news is changing as radically as the media business itself -- a result of the epochal shifts taking place in the industry, largely driven by technology. Here are links to Part 1, Part 2, and Part 3 of that series.

But before reading all that, check out this video from 1981 showing those first early steps into the world of online news. Wow. How far away those days are from a media landscape where the Twitterscape gets the scoop long before the AP or CNN.

Tone Deafness In Financial Advertising

2009-01-23T09:08:00.022-05:00

by Stephanie Fierman

If we here at the Garage haven’t said it aloud just yet, it should be a given that financial services advertising is an arena fraught with peril these days. Do you advertise at all? And, if so, what message do you communicate that won't end up sounding like a punch line? Consider for a moment that Lehman Brothers won a Best Advertising Campaign of the Year in 2007 and Bear Stearns’ tagline was “Risk Managed. Value Added.”

You can’t make this stuff up.

Here’s a Bear Stearns stress ball for sale on eBay that carries the line “Little Things. Big Impacts.” (Ha ha ha! Thank youuuu! Please remember to pay your waitresses!)

Unfortunately, Bessemer Trust appears to be playing the dark comedy angle this week.

Henry Phipps founded Bessemer over 100 years ago to manage his family’s proceeds from the sale of Carnegie Steel. Today, the firm’s website states that Bessemer manages in excess of $50B in assets for over 1,900 families, and that its “history of serving wealthy families affords us an understanding of the issues that matter to you.”

It would be safe to assume that some of those “issues” might include the scary guy in the room these days, Economic Meltdown, and his accompanying stooges, Uncertainty, Irresponsibility, Misrepresentation and Anxiety. A financial firm that chooses to advertise in this climate must reflect that it understands these realities.

So imagine my surprise when I saw Bessemer’s ad in The Wall Street Journal: a half-page ad with huge type, saying “We invest your money right along with ours. Needless to say, you benefit from some very careful thinking.”
My reaction: “They’re joking. Bessemer is an honorable and discreet company. Why would they get down in the mud with other companies that followed this same practice and lost their investors billions of dollars?” Investing your own funds is no guarantee of anything – it’s not a guarantee of wealth, intelligence, integrity or the “alignment of interest” touted in Bessemer’s ad. Lots of categories currently in the hot seat invest their own funds: venture capital firms, investment banks, mortgage companies… Enron invested its own funds alongside clients, for Pete's sake!

The ad's small type does actually call out some positive characteristics and benefits of working with Bessemer “as the credit crisis loomed.” Unfortunately, I am fairly certain that no one who saw this ad ever read that far.

Does Bessemer have an executive tuned in to the reputation and trust zeitgeist today? If not, it needs one; if so, we would suggest a bit of retuning. Contact us here at the Garage: we’ll be gentle.

A version of this post was originally published at www.stephaniefiermanmarketingdaily.com.

The Transitivity of Trust (Or Why I Don't Trust Roland Burris)

2009-01-20T16:27:00.005-05:00

Paul Allen

I was thinking to myself the other day that I would not trust Roland Burris as far as I could throw him (which btw is a very strange expression when you think about it – right up there with “the proof is in the pudding”). Now, it is important to note that, up until recently, I had never heard of Roland Burris. And I am probably not alone as far as that goes. And it is likely that my initial take on Burris is not well informed.

But nonetheless, I do not trust Roland Burris.

Unless you have been living on the same island as the cast of LOST, you know that Roland Burris is the Illinois Attorney General just seated in the US senate filling the post vacated by Barack Obama. Of course the big story around Burris’s appointment is his appointer – Rod Blagojevich (a.k.a. “Blago the Impeached”). Burris was the net result of Blagojevich’s “pay for preference” scandal in which he sought to personally profit through the appointment of Obama’s senate successor. “Blago” persisted in his legal right to make this appointment while being pursued for violating the Constitution of the United States in his attempt to make some personal coin off this appointment. Not a good guy at all. And remarkably stubborn in his “wrongness.” Not to mention his poor taste in hairstyles.

The good news is that Blagojevich is being impeached. And will face Federal charges. The bad news is that I still don’t trust Roland Burris. But I think I know why.

It is the “Transitivity of Trust” theory. Which I just made up. But it is based on some fairly sound mathematical principals, much of which we all learned in middle school or perhaps high school.

Do you remember the transitive property? It goes something like this:

In mathematics, a binary relation R over a set X is transitive if whenever an element a is related to an element b, and b is in turn related to an element c, then a is also related to c.

Transitivity is a key property of both partial order relations and equivalence relations.

Or more simply:

Whenever A = B and B = C, then also A = C.

So in this case, let’s say that I am “A”, and “Blago the Impeached” is “B”. I think I’ve already made the case (as has the entire media community) that Blagojevich is not a trustworthy guy. This is evidenced by his being the first governor to ever be impeached in the state if Illinois.

So A (me) does not trust B (“Blago”) at all. Who would?

Now, let’s say newly appointed senator Burris is “C”, It seems to me that Roland Burris must feel pretty good about Blagojevich and his decision to nominate him to the senate. After all, despite the controversy around Blagojevich’s rights, wrongs and general bad behavior Burris seems to have no problem accepting the nomination. Burris, in effect, trusts and supports Blagojevich. So to me that means “B=C”. In another words, Blagojevich and Burris appear to be cut from the same cloth – perhaps some kind of self-absorbing fabric.

So, if I (A) don’t trust Blagojevich (B). And (B) trusts Burris (C) (and vice versa). Then according to the “Transitivity of Trust” I (A) do not trust Burris (C). And that’s that.

It’s probably worth noting that Burris’ nomination came with the condition that it was for one term only. So even the government of the United States of America does not fully trust Roland Burris. Because of Rod Blagojevich. This transitivity thing is no joke.

The big lesson for me in this is how much a perception of trust can be influenced by the company one keeps. Trust (or lack thereof) is a very transferable notion. It can be rubbed on or off by those you choose to associate with. As a person, or institution becomes serious in it’s mission to become truly trustworthy (which means addressing image, culture, behaviors, values and transactions), the “Transitivity of Trust” becomes a very relevant phenomenon.

Aspiring Trustmeisters (folks who are committed to helping themselves and their organizations establish an trust-based operating approach) must put this phenomenon into real practice. Choose your colleagues and associates carefully. Assess their real and perceived trustworthiness. And don’t work with anyone who uses Rod Blagojevich as a reference.

Quotes That Tell the Story of Our Times

2009-01-19T22:48:00.009-05:00

Jarvis Cromwell

Here entirely in quotes is the story of the lowest trust age in a century. (I've paraphrased in a couple of minor instances, but you get the idea.)

“Trust is like the air we breathe. When it’s present, nobody really notices. But when it’s absent, everybody notices.” -Warren Buffett

"Not so long ago companies assumed the purpose of a business is to make money. But that has proved as vacuous as saying the purpose of life is to eat…

The purpose of a business is to create and keep a customer
To do that you have to produce and deliver goods and services that people want and value
To continue to do that a company must produce revenues in excess of costs in quantities and with enough regularity to attract and hold investors
No enterprise can do this by accident or instinct, it must clarify its purposes, strategies and plans
There must be a system of rewards, audits and controls to make sure what’s intended gets properly done, and when not, quickly rectified." -Theodore Levitt

“ABN AMRO has set itself one governing objective — maximizing value for shareholders. Setting one objective allows an organization to develop a common language and standards for decision-making and ensures that all energies are focused on reaching the objective." -ABN AMRO, 2003

"Royal Bank of Scotland on Monday announced it expects to suffer a loss of up to £28bn last year. The RBS loss will be the biggest in British corporate history...Almost all their losses are in subprime mortgages in America and related to the acquisition of ABN Amro... "These are irresponsible risks taken by the bank with people’s money in the UK,” Mr. Brown said, adding that the decision to buy ABN ”was wrong”. -Excerpted from Two Reports in the Financial Times, Jan 19, 2009

“The roots of mistrust in organizations are 1) the misalignment of measurements and rewards, 2) incompetence, 3) lack of appreciation for a system, 4) untrustworthy information and 5) integrity failure." -John O. Whitney

“The theory of capitalism, going back to Adam Smith over 200 years ago, sees an alignment of interest between consumers and businesses… This theory assumes that consumers are rational in their choices, and to a large extent they are. -Robert Shiller

“This is the worst showing for Corporate America in 30 years... It is unprecedented, in fact, to see this many people with an unfavorable opinion of big business.” -Roper ASW, July 23 2002

Trust Recovery Path: The Leadership Challenge (Jarvis Cromwell)

2009-01-12T21:19:00.008-05:00

Back in 2007 we quoted renowned free-marketeer Milton Friedman on the pages of this blog as follows:

“There is one and only one social responsibility of business," Friedman wrote back in 1970, and that is to “engage in activities designed to increase profits.”

Friedman’s viewpoint ultimately became the guiding principal of an era: profitable self-interest would be viewed as the only reliable endgame by most businesses.

And the Friedman playbook worked for a time. The rise of the activist shareholder movement, deregulation, the tearing down of the Berlin Wall, the creation of the Jack Welch rules of management, financial engineering and an expanded investor tool set as applied by the hedge fund industry were all celebrated as triumphs of the free-market.

Unfortunately, as we all now know things haven't ended so well. Along the way Friedman's proscription morphed (somewhat hideously) from its original intent of pursuing activities to increase profits to the idea that profits must be pursued at all cost.

The costs were higher than anyone imagined. We read today that there is increasing consensus that there will be a 15-25% drop in the standard of living around the world (more in some especially beleaguered regions) as a result of the current crisis. Wow. And some corners are now arguing that 2008 was to capitalism what 1989 was to communism. Is this the demise of free market capitalism as we know it? Or is there a way out of this place?

The optimistic view is that our current sorry state of affairs will herald a new era of free market capitalism that fellow trustmiester Dr. Sri Raghavan has termed "True Metric" capitalism. In other words, we will begin to measure what truly matters for the health of the system. To achieve that, organizations will need to look towards metrics beyond short-term profit to measure the health of our markets and businesses.

The pessimistic view is that business leaders won't lead us in this direction. Over a year ago the futurist Andrew Zolli wrote a piece in Fast Company where he declared that the oblivious capitalist’s days are numbered. In this case Zolli cast his eye to the future and concluded that a host of global forces will force a remake of the playbook for business success. Business will profit by driving a wider social agenda and “the clinical, value-neutral capitalism of old” will fall by the wayside.

Let's face it, whichever way you slice it companies have much work to do. That work includes reducing costs and preparing financially for a long winter. But beyond the very real financial contstaints, this is a time of customer scarcity and increasing fear. Building trust must now become a central means through which companies will drive customer sales, loyalty and retention, employee engagement, productivity and, ultimately, long-term shareholder value. It is an essential metric to the survival of capitalism as we know it. Warren Buffett compared trust and confidence to the air we breath. We take it for granted until it's gone. Hopefully management teams around the world are realizing just how essential it is to our survival.

What do you think? Are the days numbered for the oblivious capitalist -- or will leadership rise to the challenge and institute a new set of performance measures to bring us back from the brink? Which companies will get it, which won't? We would like to know your views.

Fall of GM - A Visual Guide

2009-01-08T20:23:00.012-05:00

Jarvis Cromwell

In this chart depicting both the internal and external factors responsible for the Fall of GM, 75% of the management-related factors have trust-related issues.

Unfortunately, this comes as a surprise to nobody other than GM management.

From wallstats.com

Annual Rankings for Most Trusted Companies for Privacy

2008-12-24T11:13:00.009-05:00

By Jarvis Cromwell

Privacy, identify theft and data breaches remain trust flash points for organizations. The latest ranking for most-trusted companies for privacy in 2008 from the Ponemon Institute and TRUSTe finds American Express eBay and IBM are the top three most trusted companies.

As the chart below indicates, Google is no longer ranked among the top 20 most trusted companies for privacy, while Apple, Facebook, and Yahoo make the list for the first time.

One of the most important findings from the survey for would-be corporate trustmeisters is the gap developing between the importance privacy holds with consumers and the lack of control they feel over their personal information.

Seventy-three percent of consumers say the protection of their personal privacy is “important” or “very important,” up from 69 percent in 2006.
Only 45% feel they have control over their personal information, down from 56% percent in 2006.

Greater transparency is available to consumers on this issue from organizations like Privacy Rights Clearinghouse, which posts an online chronological database of data breaches that would scare anybody based on the depth and breadth of the list.

Despite the current financial climate, Amex retained the top spot in this year’s list, and Nationwide and Charles Schwab all managed to retain their top 10 rankings as well.

The study asked 6,486 adult-aged US consumers which companies they thought were most trustworthy and which did the best job safeguarding personal information. A total of 706 companies were named by consumers and 211 made the final list of most trusted companies.

A Kids Restaurant Chain Risks It All (Stephanie Fierman)

2008-12-10T10:48:00.011-05:00

Wow, Chuck E. Cheese has a problem.

The Wall Street Journal ran a half-page story in Section A yesterday that would cause any parent to run for the hills. While CEC describes itself as a place "where a kid can be a kid" and the cover of its 2007 Annual Report boasts "The Evolution of Fun," it appears that the actual stores have become a magnet for bad behavior and danger. Police all over the U.S. have been dealing with fights, guests carrying weapons and boozed-up brawls.

When a public official describes his local Chuck E. Cheese as "something out of a Quentin Tarantino film," you know you have a serious problem. The picture at right shows the CEC in said politician's Milwaukee neighborhood - with an armed guard out front.

A simple glance at Google tells the Web 2.0 tale. Of 9 front-page search results for "Chuck E. Cheese," 5 are negative. Of 10 front-page results for "McDonalds," 0 are negative.

So where is the crisis management plan and what is the company doing about this problem? While the company's head of marketing describes the fights and problems as "atypical," the risk to a corporation is not always volume-based. Only one child or parent needs to die in one of these melees for CEC to get sued into the ether.

Not only is (a) taking aggressive action and then (b) broadly communicating your plan the "right thing to do," it ultimately protects the bottom line and shareholder value. Take the saddest, most base scenario: if the company gets sued over a child's death, it will be in far better stead with the courts - and the public - if it can show an active, consistent and good-faith effort to address this problem. Such an effort could very well include suffering a short-term revenue hit by closing the most troubled locations in the near 500-location chain. And continuing to serve alcohol in most stores is a recipe for disaster. What percentage of revenue coming from alcohol sales - at children's birthday parties - is worth a legal debacle that effectively cripples the company?

I frequently refer to the Tylenol poisonings in 1982 and J&J's decision to pull all U.S. product off the shelves even after it was determined that the company had no involvement in the tragedy. This may well be the best example in memory of a company taking the long view.

There is a range of choices CEC can take. At the lower end of the range, management needs to take action in its own backyard to resolve these issues. At the higher end, welcome Alderman Zielinski in as a valued advisor. Hold a press conference with him in Milwaukee where he ceremoniously padlocks his neighborhood location while you rightfully announce that no amount of money is worth putting people's lives in danger. Ask Zielinski to help you create a national "Having Fun Can Be Safe" campaign nationwide.

Wherever CEC lands on this spectrum, it had better act quickly. This is a case where a short-term view could be literally deadly for everyone involved.

A version of this post also appears at www.stephaniefierman.com.

Forrester Groundswell Team Reports Low Trust in Company Blogs

2008-12-09T16:50:00.008-05:00

By Jarvis Cromwell for The Reputation Garage

Forrester has just released a report on people's trust in company blogs. The upshot? Very few place a high degree of trust in corporate blogs as an information source. Check it out HERE.

The report, authored by Josh Bernoff, who co-authored the book Groundswell, highlights a survey conducted in Q2 2008 that asked consumers how much trust they had in various information sources. As you can see from the chart below, high trust goes to folks we know. The lowest trust ranking is assigned to company blogs -- with only 16% saying they have a high degree of trust in them.

Forrester and the Groundswell team are bringing fresh insight from the front lines of the social media world to a very important issue. We've noted here in the Garage that trust in big companies (not just their blogs) reached its lowest ebb in a century in 2002 and hasn’t recovered. Dozens upon dozens of research reports and studies confirm this from every conceivable angle. That’s a big problem for business because trust is transactional – meaning that when there is a lot of trust it accelerates a transaction; and when there distrust it acts a clotting agent. This dynamic applies to any transactions that involve human interaction -- whether a blog post, a sale, a conversation, an employee review, etc

David Ogilvy’s oft-quoted line from long ago “the customer is not an idiot, the customer is your wife” holds true here. Most people don’t believe that big companies are in it for them. The Groundswell team's proscriptive advice to make corporate blogs places where companies truly listen, converse, and help their customers is dead on. As is their advice that companies stop and think before joining the “groundswell.”

These are practices worthy of any true trustmeister!

Low Trust Word of the Year Courtesy of Merriam-Webster

2008-12-08T10:39:00.002-05:00

By Jarvis Cromwell for The Reputation Garage

A majority of the most-looked up words in the online Merriam-Webster dictionary once again reflect the current historically low public trust environment. In this year’s top ten the standout candidate for low-trust word of the year is “vet”, which comes in at #2.

Webster’s top ten list for 2008, based on total number of searches of their online dictionary, is as follows:

Bailout
Vet
Socialist
Maverick
Bipartisan
Trepidation
Precipice
Rogue
Misogyny
Turmoil

We doubt many people will have to look up the meaning of "bailout" in 2009.

The dictionary's list has been mirroring the low-trust environment for several years. The #1 word for 2006, “truthiness,” was popularized that year by Stephen Colbert, who defined it as “truth that comes from the gut, not books.” Webster gives truthiness an alternative meaning as “the quality of preferring concepts or facts one wishes to be true, rather than facts known to be true”.

We suspect many of us will be looking for a little more “truthiness” in 2009.

10 Low-Cost Ways to Improve Employee Engagement in the Downturn

2008-12-05T11:59:00.009-05:00

By Jarvis Cromwell for The Reputation Garage

High employee engagement is money in the bank. As the graph opposite shows, companies considered the best to work for between 1998-2004 had a total stock market return of 176% versus 39% for the S&P 500.

But when it comes to engaging employees in this economic downturn, chances are you've got at least three problems. 1) Morale is at a low ebb (surveys have been tracking its decline across most large companies for a decade); 2) high levels of distrust in management limit your ability to rally the troops; and 3) even if you could figure out what to do, the current downturn leaves you with little or no money to address it.

Don’t sit around moping. You’re a manager, so act. There are a number of things you can do that don’t have to break the bank to build trust and improve morale. After all, you can't take the next hill (which is looking to be steep and well fortified) if you don't have the trust of your team. The trick is to be consistent in your approach. Here are ten tips from Forbes that would be a good start.

1) Give thanks

2) Pull them aside for a one-on-one

3) Value family time

4) Invest in their future

5) Surprise them

6) Engage them by handing out pet projects

7) Reward specific achievements

8) Get everyone involved and limit micro-management

9) Heavy up on encouraging a team approach

10) Focus more on fun and less relentlessly on cash

The learning for trustmeisters is that low levels of trust among employees hurts performance. Given the current environment, you'll need to work harder over the next year on this dimension of your job as a manager. See the complete Forbes slide show of all ten tips HERE.

A Diamond is a Cad’s Best Friend

2008-12-04T14:17:00.007-05:00

By Jarvis Cromwell for The Reputation Garage

“Eternally basic is how people live.”

This holiday season, marketers aspiring to be trustmeisters should think about the quote above from the late, great Ted Bernstein of The New York Times. His point was that any scrap of information, every communication, ultimately connects back to people and their lives.

At the end of the day, it’s all about us -- NOT the product, market, basketball score, database, or holiday gift. Marketers call this an emotional connection, but somehow many have forgotten what that means.

Which brings us, strangely enough, to the next quote.

"Stay out of the doghouse this holiday season."

Always good advise, and in severe circumstances what is often required is, well, diamonds.

Luxury goods aren’t easy to sell right now. The ways in which people are thinking about leading their lives in the current setting doesn’t make one bullish on diamond sales.

And it’s more than just consumer retrenchment. As noted in my 11/30 dispatch, Faith Popcorn sees a movement of anti-over-consumerism taking hold among consumers – a “we can't afford it, so we might as well hate it” sentiment. Unfortunately, this is perfectly in sync with the low trust levels of our times.

Below is an approach that we think adeptly disarms the anti-over-consumerism backlash -- a funny viral campaign from the jewelry shop at J.C. Penny titled "Beware of the Doghouse." At 4 minutes it’s bit long, but totally worth the watch. It follows the foibles of, excuse the language, a dual-bag and uses humor to make a trust point: you live and die by your actions. Other positives in our view:

-- The message deeply relates to the audience (or at least to a few of us guys here in the Garage)

-- Great leverage of Facebook

-- Viral power (it starts a fun conversation)

-- Feels authentic

Fellow trustmeister Paul Dunay said it initiated that “damn I wish I thought of that feeling when I saw it.”

The true test of something viral is whether the recipient will “buzz it forward” to more than one person. If N > 1 it will go viral. If N = 1 or is <>

This campaign has N>1 written all over it. We hope it makes JC Penny some money this season.

Watch “Beware of the Doghouse” HERE. Enjoy.

Should You Capitalize on the Visibility Premium? (Britton Manasco)

2008-12-01T11:54:00.005-05:00

Are you personally seeking higher visibility in your field or profession?

If you answered yes, you’re not alone. More and more of us are aiming to be widely recognized. But this growing trend presents issues for employees and companies to consider.

It used to be that the desire for high visibility was largely confined to stars in the worlds of movies, sports and politics. But in our web-enabled world, those tools have been democratized, and the high visibility trade is now widely practiced. Capitalizing on the advice of folks like Tom Peters, individuals in business and the professions now build “the brand called you.”

In their book High Visibility: Transforming Your Personal and Professional Brand, Philip Kotler, Irving Rein, Michael Hamlin and Martin Stoller argue that high visibility marketing and communication has become a sophisticated industry that reaches deep into the economy. The book, which was originally written in 1997 and was re-released (and re-written) in 2006, provides a framework for understanding the drivers and enablers of visibility. The authors contend that “attaining visibility has become a highly sophisticated process” and “all kinds of people today are seeking ways to become brands.”

So why are more people seeking high visibility?

One reason is that higher visibility often translates into more money. Those who are better recognized command higher fees and salaries and other perks.

Another reason is attention. Those who are well branded in the marketplace attract more prospects (or prospective employers).

A third is trust. One won’t be widely viewed as a provider of trustworthy guidance unless one has already been elevated to a certain level of public recognition and esteem.

Finally, there is status. Tom Wolfe argues that economic expansion after World War II fostered the emergence of new “status spheres,” and encouraged status competition.

For all these reasons organizations are attracted to high visibility individuals. Corporations have paid enormous sums to attract recognized CEOs with impressive track records. Universities seek respected names as their leaders. Newly elected presidents want a certain amount of star power in their cabinets.

But there are downsides. As with Hollywood stars, high visibility can make a career, or break it. It can lift an enterprise or hamstring it. Companies that have sought “rock star” CEOs have often ended up disappointed with the results. Jim Collins, author of Good to Great, points to HP’s transitional struggle with Carla Fiorina and wonders how well Apple will perform over the longer term without Steve Jobs or Oracle without Larry Ellison or Cisco without John Chambers.

“We learned in our research that the most effective leaders never make themselves the center of attention,” wrote Collins in a Wall Street Journal editorial in 2001. “They are understated yet determined, quiet yet forceful. Most lack the liability of charisma. Indeed, the very best ones overwhelmed us not with their ego, but with their humility. They’re ambitious, to be sure, but ambitious first and foremost for their institutions, not for themselves.”

So in this new world where more rank-and-file employees are seeking to increase their personal visibility, how do you balance what’s best for the individual as “visibility aspirant” with what’s best for the enterprise as thought leader and brand? This is an increasingly important question to in today’s highly contested, trust-starved and turbulent markets.

Let me argue that as organizations seek to turn more employees into “thought leaders” in order to boost their reputation and build brand trust; they need to articulate a specific and strategically well thought out set of rules for the road. Also companies should not invest all of their visibility producing resources into just one or a few individuals. Things change. People move on. Risks may outweigh benefits when you invest all your visibility capital into one basket.

It’s better to cultivate multiple thought leaders within an organization and raise their visibility collectively. It’s also important to raise the visibility of the organization itself as a source of trustworthy and authoritative guidance.

For individuals, the visibility premium has powerful allure and can be lucrative. But will you take the necessary steps to earn this premium and build trust with your audiences? Or will your fans end up wishing upon a falling star?

I'll discuss steps for ensuring trust as you build your visibility in my next dispatch.

Britton Manasco is a contributing "trustmeister" to the Reputation Garage and founder of Manasco Marketing Partners, a firm that specialized in thought leadership strategy and execution. He also produces the blog, Illuminating the Future: How Thought Leaders Become Market Leaders.

Not a “December to Remember” for Toyota (Jarvis Cromwell)

2008-11-30T22:07:00.004-05:00

We admire many things about Toyota here in the Reputation Garage. The current Lexus “December to Remember” advertising campaign is not among them.

One spot – watch it below – is trying to be clever. But it’s so far off the mark for the tenor of the times that it comes off as tasteless and insensitive. It should be pulled.

In it a woman, pictured as her childhood self, gleefully remembers the Christmas where she got a real pony, and how jealous the little girl next door was. Savoring this moment of childhood triumph, she goes on to say that nothing could be more…perfect (cut to the woman now grown admiring her new Lexus complete with bow in driveway.

The December to Remember campaign is its ninth year and Lexus noted in 2007 that it “is as anticipated as the traditional Clydesdales or polar bear campaigns.”

That was then. Here are a few comments we found on Twitter and other communities across the net in about 60 seconds:

“This commercial has gotten me truly angry…

"Saw loathsome Lexus 'December to Remember' spot of the season. What does it take to kill them?”

“Re: Lexus 'December to Remember' spot. How to kill them? Garlic-encrusted stakes have failed. Maybe this economy will do it.”

“Toyota ought to be chastised for these commercials.”

“I would love to give a new Christmas owner of a "December to Remember" car a shot to the nose.”

Trendwatcher Faith Popcorn sees a movement of anti-over-consumerism taking hold among consumers. "It's a convenient time for this. We can't afford it, so we might as well hate it.”

Indeed, we found no positive comments about Toyota’s campaign in our brief web search. Maybe there is something good to be said about this spot. We just couldn't find it.

Our advise for Toyota whose sales fell more than 25% last month: Take heed of Paul Allen’s recent advise in his post on the performance economy HERE. This is not an environment for mistakes. Now more than ever you must make the consumer feel smart, protected, safe, heard, and connected. Your customers may buy from you. Do they feel good about it?

And recall Paul’s worst-case scenario… what if your customers just don’t like you? We can’t imagine that any incremental sales from this commercial could possibly be worth it in the long run. You can do better than this, Toyota.

Trust and the Performance Economy Part 2 (Paul Allen)

2008-11-25T16:45:00.013-05:00

You Must Deeply Relate to Your Markets in Today’s Performance Economy, or You're Operating Blind.
No markets….no moolah.
No trust… no markets.

Ed Note: You can find Part 1 of the series HERE.

Well-defined and trust-breeding markets matter more than ever today. Every marketer and organization must meet very specific requirements to succeed. But perhaps more importantly, every marketer and organization serves very specific people.

I remind myself regularly that markets are just lots of people who often want the same thing. And there is a lot of evidence that these people, who are your markets, are asking categorically for two specific things from you:

“Do me some good” (Investment Protection)
“If I spend money with you, is it going to be a good investment, a good value?” Customers will not give you money in today’s increasingly hyper-transparent marketplace if they believe you're not delivering the best option in a sea of alternatives. And as word-of-mouth research is discovering, your customers talk to peers about you online, offline, in every context imaginable. The operative word for marketers here is “deliver." We live in a “show me marketplace” (a term coined by the Trustmeisters here in the Reputation Garage.) In such a marketplace, you need to deal with the “do me some good” issue proactively and in advance.

“Don’t do me harm” (Reputation Protection)
The vast majority of people, unfortunately for our economy, don’t believe big companies are ‘in it for them.” The same has been true for government, the media, and others. Sorry to say it, but even your own customers are unlikely to trust that you have good intentions and their self-interest at heart. As a result, the question your customers are asking harder than ever is “if I associate with you, vote with my wallet, will it make me better off... or are there hidden downsides? What if your products and services don’t last, prove unreliable, embarrass or harm me somehow? Perhaps worse, what if I just don't like you?"

In an economy and purchase-decision environment stressed at the core, people gravitate towards like-minded organizations, who show good intentions and who help their positive self- image by validating and enhancing their point-of-view. If you end up with a reputation for doing harm, watch out! This is not an environment for mistakes. Now more than ever, products and services can't win by merely delivering features and functions, they must make the consumer feel smart, protected, safe, heard, and connected. Your customers may buy from you. Do they feel good about it? And what do they say about the experience to their friends, online or otherwise?

A useful way to think about the issues above is to view investment protection and reputation protection as a parallel universe to value creation and trust creation, which I discussed in Part 1 of this series. One is defense, the other offense. In volatile markets, it is a strategic imperative to decide when one is on offense, and when one is on defense. Downturns often mandate defensive strategies. But some luckier brands could find themselves in the right place at a bad time.

Trust Creation versus Reputation Protection is in our view a fundamental brand strategy filter to help find the right market development strategies that have mass and direction. We believe that they need to be a key part of every organization's roadmap for identifying and executing on the ideas and offerings that you hope will be embraced by your markets (the people who will give you money). It is a management-level exercise that will require taking a longer-term view of your brand, assembling and managing the right talent to build trust and focusing on direction and flawless execution.

It is only fair to note that the current Performance Economy (and like all before it) comes with its own special features - like a media-fueled depression-era mentality, the nationalization of the financial industry globally, and a lot of speculation as to exactly what economy we’re in now.

But you already know the answer to that. And can start thinking about:

1. When should your strategy emphasize offense (value creation/trust creation) vs defense (investment protection/reputation protection)?

2. Do you deliver both investment and trust protection to your customers?

3. Are you fully leveraging the cultural, behavioral, societal, and philanthropic assets of your organization?

4. Is there an institutional understanding that trust creation accelerates value creation?

Some food for thought if you’re thinking at all about this Performance Economy and how it might be navigated, or even conquered.

Paul S. Allen is the chairman of independent advertising agency Allen & Gerritsen (www.a-g.com) He is also a founding “trustmeister” of the blog The Reputation Garage.

Trust and the Performance Economy Part 1 (Paul Allen)

2008-11-24T10:35:00.008-05:00

Back in the year 2000 – shortly before 9/11, way before the invasion of Iraq, and way-way before the collapse of the global credit system - a serious debate raged. The central question was a profound one.

“Which economy are we in?”
Good question. What’s everyone think?

The year 2000 was the backside of the dot.com bubble, still bloated and ready to burst. Money flowed, valuations were generous, VC-backed investments were the rage, technology was everything, more people had more than they had ever had before. Which, I guess, meant people had lots of free time to think about exactly which economy they were enjoying so much.

Pundits said we were in the midst of the Internet economy, the technology economy, the Silicon-Valley economy, the dot.com economy, the wired economy – and the big kahuna of them all – the new economy. My personal favorite is the new economy - because it made so little sense, as if the all too human drivers of economic sustainability took a permanent vacation. Plus, the moment you anoint a new economy, it starts becoming an old economy. And as we are painfully learning today, sometimes an old economy can become barely an economy at all.

“So, again, what economy is this ?
My answer is the same as it was in 2000. This is the Performance Economy.

In August of 2000, I penned an editorial column titled “The Performance Economy.” The following excerpt (forgive me for quoting myself) sums up my view:

“I am no Alan Greenspan, but markets have always rewarded performance. So why not describe the economy by what it is and always has been, the Performance Economy. No matter what descriptors we give it, the standards of economic measurement will always concern itself more with fundamental performance than today’s investment fad.”

So how do we think about this from today’s vantage point?

Clearly there are aspects to performance that remain the firmament of value creation – revenue, earnings, efficiency, quality, liquidity, capitalization, etc. These will always be a vital part of any Performance Economy. But there are components of performance that I would characterize as the firmament of trust creation – behaviors and characteristics that mitigate risk and enhance staying power during challenging (pronounced “recessionary”) economies. In times like these, trust creation might be just what the economist (pronounced “doctor”) ordered.

I am also pretty convinced that trust creation has an exponentially positive effect on value creation.

As organizations wrestle with the challenges of a volatile economy by rationalizing relative performance, there are other important performance opportunities that have the potential to help offset the downward pulls of market movements. Revenue, earnings, efficiency, quality, liquidity, capitalization will always be a highly managed part of any Performance Economy (value creation). Where many organizations fall short is in thinking about the opportunities, short and long-term, that come by focusing on managing trust creation.

Here’s a list, not in any order, of a few institutional characteristics that contribute greatly to trust creation: characteristics that help offset the unavoidable swings in value creation dictated by a volatile environment:

1. Genuine commitment to benefitting stakeholders in tangible ways
2. Qualified, accessible and accountable leadership
3. Executive decision-making that carefully weighs impacts on stakeholder interests
4. Transparent financial practices
5. Transparent, direct communications
6. Clear commitment to business ethics
7. Societal contribution for non-commercial purposes
8. Environmentally responsible operations
9. Consistency of promise relative to delivery
10. Authentic, high-touch customer engagements

Individually, or in the aggregate, the list above would enhance the real and perceived trustworthiness of any enterprise. And would help stave off customer, employee and margin erosion in times of uncertainty.

The question my fellow trustmeisters and I ask an organization is this: Do you really manage trust creation? Creating trust is an active enterprise. Either you manage it like other performance measures (such as quality) or you leave yourself open to being an also-ran in this important dimension with your stakeholders.

And that may be just the ticket for getting through some of the darker aspects of the current “performance economy.”

Paul S. Allen is the chairman of independent advertising agency Allen & Gerritsen (www.a-g.com) He is also a founding “trustmeister” of the blog The Reputation Garage.

On The Small Matter of Optics (Stephanie Fierman)

2008-11-20T08:49:00.003-05:00

"Optics," in Wall Street parlance, means how something looks or appears on its face (without a lot of detail).

It's ironic that the phrase originates in the investment community - because said community seems particularly blind to the topic and its power.

I submit to you the following:

1. AIG used taxpayer money on sales retreats, replete with spa treatments. After getting pilloried in the press for such profligacy, the firm went ahead and used more taxpayer money on deferred comp for the top 5% of its executives. Earth to AIG, come in AIG...

2. The CEOs of GM, Chrysler and Ford flew to Washington DC in private jets this week to plead for a bailout. The Washington Post labeled this a case of "stone-cold tone-deafness."

3. James Cayne, the former CEO of Bear Stearns, was busy playing bridge in Tennessee without a cell phone or Blackberry while the financial community struggled to save (or sell) his firm.

On the flip side - with good optics - is The Nielsen Company who recently cancelled its 2009 client meeting, citing economic concerns. Does it matter why Nielsen may have actually cancelled the event? Not for a minute.

The importance of optics can be a hard lesson for executives to learn. As a marketing executive, I have counseled many on discontinuing or deferring activities not just because said actions may be truly inappropriate, but also because of how they will be interpreted by stakeholders. And in times of heavy oversight the result of such activities is exponentially devastating.

Remaining in tune with the effect of optics on an organization's reputation and perceived integrity is the job of every leader.

Blogger forces NASA to Admit Global Warming Error and Other Trust Missteps (Jarvis Cromwell)

2008-11-19T18:15:00.006-05:00

Today on the Trustwatch List:

It's reported that all three big auto CEOs took the fancy private jet to the government panel meeting where they planned to ask for a taxpayer bailout.

General Motors takes out a full page ad in The New York Times on why they deserve a bailout. It was all about them with nary a peep about their intentions for customers. Reputation myopia apparently remains epidemic in Detroit.

AARP investigates marketing practices of partners who were not truthful in how they sold health insurance plans. See HERE.

And finally there’s NASA. Last year NASA officials admitted that for the past seven years they had used the wrong temperature statistics to assess global warming trends. The mistake was spotted by a blogger, who forced NASA to declare the error.

Well, my friend Paul Walsh who is guru of all gurus on the weather’s impact on the global economy posted this morning that NASA has made another mistake along these lines – overestimating climate change numbers. See HERE.

And this may be shameless self-promotion, but the trustmeisters here at the Reputation Garage were happy to hear him note the following:

“The NASA PR engine should review the website (The Reputation Garage) of my friend, colleague and "trustmeister" Jarvis Cromwell. Reputation and trust capital is a key metric for a scientific agency like NASA -- making the case for an issue as critical as climate change (or going to the moon, mars, etc.) is only viable if the public can trust the information that they put out.”

Thanks Paul. Trust and reputation are not merely communications issues, they are performance issues and every one of these organizations needed more process in analyzing the downstream impacts of their actions on stakeholders.

Engaging Employees in an Economic Downturn (Jarvis Cromwell)

2008-11-17T09:03:00.006-05:00

We've said before that "spin" is now part of the lexicon - and that changes how you communicate. In what is the lowest trust environment in a century, words are increasingly disbelieved. Motivating workforces is not the sole job of an HR or PR department, but an exercise of transparency and engagement across the company. And for a company with, say, 10,000 employees, there is no better (or worse) buzz than what gets served up by this crowd. The video tips from Vince Thompson below outline the idea pretty well.

Changing Media "Trustscape" Part 3 (Jarvis Cromwell)

2008-11-16T11:23:00.005-05:00

For several years now public trust in the mainstream media has been declining, a trend reflected across dozens of polls. One poll from earlier this year, HERE, found just 19.6% say they believe all or most news media reporting. This was down from 27.4% in 2003.

Courtesy of my friend Paul Walsh, here's a great YouTube piece that unmasks television journalism's desire to show sensational images. Right before this aired, Katie Couric was promoting a segment criticizing a staged inteview with soldiers in Iraq. A few moments later the show went to correspondent Michelle Kosinski with this:

NBC Reporter Exposed as She Fakes Extent of Flooding on Today Show

Media Trustscape Part 2 (Jarvis Cromwell)

2008-11-15T15:03:00.004-05:00

When a McCain aide leaked that Sarah Palin didn't know that Africa was a continent, the media went on a manhunt to figure out the source of the leak.

And the answer finally came back that it was Martin Eisenstadt, a McCain policy adviser. MSNBC, Fox, the Los Angeles Times and blogs and media outlets aplenty covered the news.

One problem. Martin Eisenstadt doesn't exist, as The New York Times noted today HERE. He is a complete hoax.

Score one for the NY Times and traditional trust-tactics of verifying sources and the facts. In this case dozens of publications and thousands of blogs were perfectly happy to pass along an entirely faked source to their readers.

Food for thought in the changing "media trustscape".

Copyright 2008 by the Reputation Garage

At Columbia: The Changing Media "Trustscape" (Jarvis Cromwell)

2008-11-14T14:14:00.010-05:00

Back when I was CMO of Thomson Financial, a viral video about Google was making the rounds. From the vantage point of the year 2020, the piece spun a fictional history of Google. Sometime around the year 2013 The New York Times was forced to convert to a newsletter “read mostly by the elderly.”

Now a few years later we’re back to the future. On Tuesday night Columbia University’s J-School hosted its 4th Annual Changing Media Landscape discussion. The consensus? Expect the disruptive changes taking place to accelerate, particularly given the economic environment.

Jacob Weisberg, chairman of Slate, cast the die on the relationship between traditional and new media this way:

“New media and the traditional media are diverging rapidly after a period of relatively peaceful coexistence. We are moving into a conflict model.”

Of course the traditional media model has been under siege for several years and Jeff Jarvis and others have warned about the consequences of failing to adapt. And media company share prices have reflected Wall Street’s concern.

But innovation and adaptation take time, which is why they are not management’s first reaction to disruptive change. Cost cuts, however, are tried and true, albeit not actually a fix. Another panelist at the discussion, Erica Smith, is a news designer for the St. Louis Post-Dispatch. She also writes a blog called Paper Cuts that details the jobs cut at newspapers nationally. By Erica’s count, the industry has lost 13,000 jobs so far in 2008 with the coasts particularly hard hit.

Another concern on the lips of most every panelist was trust. Indeed, it wasn’t lost on the panel that a changing media landscape creates what we've termed here in the Reputation Garage as a changing media “trustscape.”

Sewell Chan, blogger/bureau chief of the New York Times’ City Room blog, noted that trust models are different for new vs. old media. In a traditional media you seek audience confidence based on the judgment of editors and by maintaining a high standard of reporting. Trust in such organizations is not high, however, falling in some cases to historic lows along with trust in government and big companies in general.

Content aggregators, such as Tina Brown’s The Daily Beast or The Week, have a different trust model because their role is to sift through reams of news and data to find the golden nuggets. (Professional News Recommender is now a job title, by the way.) Readers need to trust the sifting process, but the jury is out on how to create trust for this model.

Finally, the new media trust model seeks to create an environment where you build on the trust that is already resident in social networks. As we’ve noted in our work here, we are now living in the lowest trust era in a century. Peer-to-peer trust, however, is one of the few bright spots. Digg, Delicio.us and others are very democratic in how they surface content.

Chan believes that with the dawning of mass amateurism in news and reporting across millions of blogs, the lines between the professional and the layman have blurred.

The learning for would-be “trustmeisters” is this: There is lots of good content being created in the new media world, but those core trust issues of verification, fairness and neutrality will never go away. Old media trust practices need to be married with new media democracy. While progress is being made, there remains plenty of opportunity for innovators to find new ways to accomplish this.

Stay tuned.

Human Resources Should Lead on Trust (Jarvis Cromwell)

2008-10-22T22:14:00.017-04:00

The following piece written by me appeared in HR Leaders

Sure, trust is “topic A” among the pundits and in many respects it’s turning out to be one of the defining issues of the emerging century.

No news there. What is getting less attention is that the current state of low-trust is not confined to the financial markets. Public distrust in big business, Congress, even not-for-profits, reached its lowest ebb in a century… and not this past year, but back in 2002. In writing about how striking a finding this was for business results at that time, the Roper Organization grimly noted:

“It is unprecedented to see this many people with an unfavorable opinion of big business.”

For HR professionals, low-trust must now become a central issue in shaping human capital strategies, employee engagement and corporate performance initiatives. Why? Because trust is transactional and can impact relationships in every corner of your organization. No matter what the transaction may be – an interbank loan, a frank discussion with an employee, a sales pitch, or a team meeting – the outcome is aided when trust is high and hurt when it’s low. In this sense you can think of high trust as an accelerant to business performance and low trust as a kind of clotting agent that at best slows transactions down and at worst stops them dead in their tracks.

Low trust is a particularly nettlesome HR issue because it makes leadership success more difficult. A startling statistic comes from the Harris Poll, which in 1966 found that 55% of Americans had “a great deal of confidence” in the leaders of big companies. In 2007, only 16% of Americans expressed the same confidence.

Imagine you were designing an employee engagement program back in 1966 to help achieve an important operating goal. Maybe you needed to rally the troops around a new strategy, or convince sales about the quality of a new product, or persuade the union that certain proposed regulation is unwise. Now imagine that same program being implemented today amidst much lower trust among all the various stakeholders. It’s a pretty safe bet that the desired transaction in the higher trust world of 1966 would have greater chance of going smoothly than the same program delivered in 2008.

Beyond the Roper and Harris polls are literally hundreds of studies over the last few years that paint a very difficult operating environment for building trust, among the findings:

• As few as 13% of all Americans are placing their trust in big business
• Only 39% of employees in a Watson Wyatt survey said they trusted senior leadership
• On primetime TV you are 21 times more likely to be kidnapped or murdered by a businessman than by the mob. Some three-quarters of folks out there feel companies don’t tell the truth in advertising.
• Three quarters of employees in big companies observed violations of the law or company standards in a 12-month period.

Grim statistics all – but table them for now. Because the key question comes down to this: how do you lead a company to capture strong performance when trust is low?

As a performance discipline, trust today is where quality was in the 1970s before Deming and TQM were widely understood or applied. Senior executives often intuitively recognize that trust is important for driving results, but they lack an effective process to manage it. HR professionals can help their organizations close this gap by taking steps to begin institutionalizing processes that lead to higher trust.

As trust and reputation-related risk issues climb to the top of management agendas, HR can lead the way by seeking effective ways to align what the organization is doing (performance) with desired reputation (trust). The problem is that almost every management team lacks two vital components: 1) a disciplined review process to evaluate how decisions and actions across the organization have impacted trust among stakeholder groups and 2) a means for guiding operational execution and decision-making – both to achieve reputational goals and to mitigate the risk of a damaging “trust event.”

Accepting the idea that companies need to find new and more effective ways to ensure that performance is aligned with trust, how do you begin? Based on work we’ve done in the Reputation Garage, a collaborative founded to create new ways to improve organizational performance in an era of low trust, here are four steps worth considering:

1. Improve executive decision-making by sensitizing management to the issue of trust. Based on our study of this issue, the lack of understanding executives have for the downstream trust impacts of their decisions and actions is a primary contributor to the problem. The good news is that training can install a “trust lens” to guide executive decisions and improve appreciation for trust-related impacts.

2. Identify those key trust/reputation elements that are vital to achieving your mission, goals, and strategies. The first step in making trust a performance-related issue in an organization is to identify specifically where it fits into the core success drivers of the business. Call them what you will, but the strategic goals of the company need to link with your trust in meaningful ways, because it is management’s strategic goals that drive the focus of the company.

3. Consider adding a trust/reputational risk dimension to your current risk management program. Trust-related events occur with far more frequency than one might suspect. In a study conducted between 1989-99, Lippincott Mercer found a surprising number of Fortune 1000 companies experienced a serious event that damaged their stock price. To be considered serious, the event had to lead to a company losing 25 percent or more of its market value in four weeks or less—in other words, a major haircut. How many companies experienced this kind of corporate tsunami? One out of ten! The leading cause of loss was what Lippincott Mercer called “strategic missteps.” Representing some 58 percent of the events that took place during the study period, many of these missteps stemmed from trust/reputation issues. If you calculated the typical loss based on an average market capitalization for the Fortune 1,000 today, you would come up with a loss of more than $2 billion per company, on average.

4. Enhance transparency and measurement through a trust-related performance measurement program. Do you have a process in place to collect, evaluate, and report on how various operations, actions, policies, and decisions affect your brand reputation? What work have senior management teams done to identify and manage those key operational tasks that will create brand opportunity or mitigate reputational risk?

I have been involved with this issue for 20 years and the one thing I can say with confidence is that the tools for managing trust today are crude. My expectation is that in the next few years many companies will move from a state of stone knives and bearskins to a more sophisticated approach. Corporate performance and the world will be better for it.

Trust Redux (Jarvis Cromwell)

2008-10-22T20:21:00.009-04:00

In founding the Reputation Garage collaborative back in early 2007, we wrote of our goals to drive trust in a low-trust world. The premise was that Trust mattered and needed to be fixed before things really want awry. Little did we know! Below is that early post.

WHY WE STARTED THE REPUTATION GARAGE

The world’s business community has reached, well, let’s just call it a low point: Practically nobody trusts big business. (In the U.S. the number who say they trust big companies and brands hovers around 13%)

So the intent behind this blog is as simple as it is ambitious: We're an experienced group of professionals who want to help change the dismally low worldview of business. We are pushing for a new era of business performance - where companies and their brands are trusted more than they are today. (Along the way, we also expect to see continuing seismic shifts in marketing practices as we know them.)

Our merry band of “trustmeisters" includes yours truly, a consultant and former big company CMO who is known for his thinking on this topic; a U.S. ad agency chairman who questions the efficacy of many traditional marketing programs and practices; a corporate social responsibility expert and U.K. native who has also served as co-head of the U.S. branding practice for a global communications firm; and a leading thinker at the intersection of marketing and technology whose day job happens to be at one of the world's leading consulting firms. We'll be adding more trustmeisters as we go along.

Are we out to change the world? No, but if trust matters, then a lot of organizations are not supported by strong footings. More importantly, a majority of customers and employees around the world are expressing unhappiness with the current state of affairs. That doesn't exactly spell brand power or, to use the catch phrase of the moment, employee engagement. Because traditional practices have failed to prevent or solve these problems, new ideas and actions are called for here.

So for the record, trust matters. Indeed, if you’ve attended any of the last several World Economic Forum meetings in Davos over the past few years, you know that there is significant hand-wringing taking place over this issue. When trust declines, the nature of virtually every exchange and transaction is altered. Brands, which are built on trust, lose value. Sales become harder to generate. Customers defect, as loyalty deteriorates. Employees disengage from their jobs and the company mission.

So where's the fix for organizations looking to improve upon this sorry state of affairs? Join us here in the Garage as we uncover, evaluate and share emerging new ideas and solutions for what may be the most important marketing issue for our times.

Reputation Management for New Media Survey - How ready are you? (Paul Dunay)

2008-07-01T12:35:00.004-04:00

One of my goals this year was to do a study on reputation management. As we all factor in the effects of new media on our brands, I felt this was a topic with long-lasting appeal to every marketer.

My hypothesis going into the creation of these questions was that B2B marketers (including yours truly) just aren’t adequately prepared for an online reputation crisis. Dell wasn’t, Wal-Mart wasn’t. If those big B2C brands weren’t ready, I was betting we weren’t ready either. And I was right!

To be totally transparent with you, I wasn’t surprised by many of the responses to my survey. The bulk of you are monitoring your reputation in some way, shape or form. But are you poised to respond in the case of an online reputation crisis? 55% admitted you weren’t.

Perhaps you need stronger guidelines in place, like a blogging policy. Two-thirds of respondents don’t have one!

Many of you are do-it-yourselfers when it comes to monitoring your reputation. Is that perhaps because your company hasn’t made this a strategic priority? 53% admitted it wasn’t a strategic priority for you – yet!

My goal here is to give you the state of the union when it comes to monitoring reputations online. This data is bound to change, so I hope I get you thinking of ways to close the gap with your organization’s reputation!

Click here to download the free research report

Special thanks to my sponsors – Trackur.com, run by the renowned Andy Beal of the blog MarketingPilgrim.com, and Marketing Profs’ equally renowned Ann Handley for their support on this survey.

Reputation Management for New Media (Paul Dunay)

2008-01-23T22:26:00.000-05:00

A strong brand helps to communicate that a company and its offerings are relevant and uniquely able to meet customer needs. Most companies today pour millions into brand-building campaigns to generate that external awareness, which in theory can speed up the sales cycle. This has become the accepted norm, taught to us by the very advertising agencies we hire.

But all this great awareness can come crashing down on you with one reputation disaster online.

Good and bad reputations are opposite sides of the brand coin. And the ability of consumers today to share their opinions of your brand with just a click of a mouse levels the playing field for all and puts your brand in constant peril.

A solid reputation reflects the partners you do business with, the strength of your management team, your company’s financial performance to date and, ultimately, the types of employees you hire and will hire in the future. But literally millions of customers and prospects engage in social communities on the Web today. Facebook alone has 50 million community members, with over half of them logging in daily! Couple that with the ease and ability to create a quick video or podcast, or post a negative comment on a blog, and you have a recipe for reputation disaster.

Unfortunately, when a reputation disaster occurs, it is becoming more difficult for your PR team to execute using the usual crisis management playbook, because the type of media, placement of media and approach to each medium differs. This fragmentation means it will become increasingly difficult to neutralize criticism and restore reputations when something happens.

Additionally, the Internet already has built-in, automatic reputation ranking systems. Currently examples are Google for companies and eBay for vendors. These ranking engines are quickly becoming extremely effective ways for people to determine how reputable your company is before deciding whether to do business with you.

The bottom line: As media continue to fragment with the explosion of yet more social networks, aggregators like Google will become increasingly important in helping users decide whether or not to do business with you.

So what is a company to do?

I recommend a three-step approach to reputation management called “MRO”:

Monitor – Companies should designate an employee or hire an external service to monitor, moderate and drive positive discussions.
Respond – Technical staff should be designated to respond to any product or support issues that arise from communities and take the lead in responding with action plans to any negative sentiments that develop.
Optimize – Companies need to proactively optimize their reputation online over time by exploiting the positive aspects of their brand (an example here is GE, whose Ecomagination is demonstrating the company’s commitment to keeping the environment clean).

Each MRO element is designed to give you a point person for this reputation-protection trifecta:

Monitor gives you a way to see and engage in conversations before they get out of control. People will be a lot more polite online when they know you are listening. The challenge is learning about conversations that arise quickly. This is where you need reputation bulldogs, who can be out there watching all the time.

Respond gives you a dedicated point person internally who can talk about your product or service with authority and provide clarity on how you might resolve an issue. As I said above, this should be a technical person rather than a communications person. This will convey the company’s commitment to address the issue.

And finally, Optimize. Optimizing your reputation in the marketplace means you go beyond just keeping it on track. You invest in the online aspects of your reputation just as you invest in other dimensions of your brand.

Having a strong brand doesn’t mean you have a strong reputation. Ignoring this critical factor is a risk that companies can’t afford to take today.

Reputation Gaming with the Sybil Attack (Paul Dunay)

2008-01-08T20:29:00.000-05:00

Online reputation management, be it a personal reputation or a corporate reputation, has become a growing issue for marketers over the past few years. Groups are popping up devoted to helping you manage, and in some cases clean up, your digital reputation.

On the flip side of that, there is another group also emerging – reputation gamers. Reputation gamers are abusing the very reputation management systems responsible for our digital lifestyle such as Google, Del.icio.us, eBay and Digg, etc.

Here is an example of such activity:

Digg is a site where its members can submit articles, along with a short description and a link, in the Digg system. Other members look through these articles and choose either to “digg” or “bury” stories. Articles with the most “diggs” make it onto the site’s widely read front page.

One reputation gamer’s method of choice was the so-called Sybil attack. Named after the famous case of a woman with 16 personalities, a Sybil attack occurs when an individual opens multiple accounts and has them all recommend the same article. If it gets enough votes, the story could make it to the front page of Digg, with a huge payoff. Getting on the Digg front page is equivalent to a front page story in a major publication, drawing millions of readers who have the potential to catapult a story to the top of a Google search. If the Digg site has advertisers, it could be a financial windfall. If the site sells something — say a widget or a T-shirt — the rewards can be even greater!

Where’s the Buzz? First of all, let me be clear - I do not recommend this type of activity. The Web 2.0 world is meant to operate in a self-policing way, much like Wikipedia. Marketers who go down the Sybil attack or a similar path should beware their reputation as a marketer is at stake. As for the sites themselves, I guess we need to think, perhaps worry, about the reputation of the reputation management systems themselves!

Trustmeister to PRSA: Become Ambassadors of Trust (Jarvis Cromwell)

2007-11-11T20:50:00.000-05:00

I was in Maryland last week speaking at the 30th Annual PRSA Chesapeake Conference. I had been asked to speak on the topic of how communicators can gain more influence at the c-level executive table.

This is not a question that lends itself to the typical conference diet of case studies or top ten lists. The stakes are higher than that. I tend to think of the times we live in as a kind of “triple witching hour” for both marketers and communicators. Trust in big companies has reached an historic 100-year low. Reputational risk is now seen as a top-ten worry among CEOs. And the new digital era has upended traditional one-way communications programs in favor of two-way dialogue, enabling the public to take more control of the conversational agenda.

These trends and others are making life especially challenging for corporate communicators. But we’re talking about gaining a strong seat at the C-table. So for now, let’s leave aside statistics that show as few as 13% of all Americans are placing their trust in big business, or that on primetime TV you are 21 times more likely to be kidnapped or murdered by a businessman than by the mob. We’ll also shelve for a moment the nettlesome fact that some three-quarters of folks out there feel companies don’t tell the truth in advertising. Or what about that KPMG study a few years ago that found 76% of employees in big companies observed violations of the law or company standards in a 12-month period.

Grim statistics all – but table them for now. Because the real question around the C-table typically comes down to this: how do you lead a company into strong performance?

Turns out that in recent years the low-trust headwinds that are negatively impacting so much of American life are also making leadership more difficult. A startling statistic comes from the Harris Poll, which in 1966 found that 55% of Americans had “a great deal of confidence” in the leaders of big companies. In 2007, only 16% of Americans expressed the same confidence. So imagine you are writing a speech for a company executive in 1966 to help achieve an important operating goal. Maybe you need to rally the troops around a new strategy, or convince customers of the quality of a new product, or persuade legislators that proposed regulation is unwise. Now imagine that same speech being given in 2007. It’s a pretty safe bet that the impact of the speech in the higher trust world of 1966 would have greater impact than those same words delivered in 2007.

The learning here for would-be “trustmeisters” is that our words are less believed today. That’s a big issue because leaders depend on effective communications to sell products, engage employees, and generally manage a business. That’s why communicators must become effective ambassadors of trust for their organizations. Executives who are not looking for ways to tackle the issue of distrust will find that they’ve inadvertently diluted their power as leaders. Communicators and marketers will find a ready seat at the executive table if they can help management take back the high ground.

Easy? Not at all. May the force be with you.

On Stephanie Fierman, Google and your Online Reputation (Jarvis Cromwell)

2007-10-16T22:29:00.000-04:00

Listen up, because this is important to your professional reputation and career.

Readers know I blog about the impacts of low trust on all kinds of human exchange and enterprise. Do you trust me as a credible expert? If you're not so sure, what action would you take?

Did I hear the word "Google"?

Well, google me and you'll get a bunch of corroborating evidence. I'm a seasoned chief marketing officer (CMO), I've contributed a chapter on trust to a marketing book and I speak about trust and reputation at conferences around the country. Unfortunately, a Google search on my name also serves up this result:

"A 25-year-old Goldsboro man -- wanted by New York City police on two murder charges -- was arrested Tuesday by Goldsboro police."

That other Jarvis Cromwell – who apparently is a couple of decades my junior – shows up on page 7 of my Google search listings. If you ever thought he was me, your opinion would surely change. Which is why online reputation is so important, and that brings us to Stephanie Fierman.

Last week Stephanie Fierman, a well known and respected marketing executive, spoke at a CMO Club dinner in New York and shared some thinking on managing online reputation. You can find coverage on this topic by Anna Maria Virzi in ClickZ here. You can also read Stephanie's blog, here.

Stephanie got everyone’s attention by discussing how widespread gossip, innuendo and misinformation about executives are on the internet. And it is easy for executives to wake up one morning and find themselves the victim of misinformation or worse. And the more senior and visible you are in an organization, the more vulnerable you are to potentially damaging disinformation campaigns. The scary part of the story is that everyone from recruiters, to new hires to clients can and do check you out on the web.

So start taking action now. Here are a few of the tips Stephanie shared the other night:

1. Monitor your online footprint. Many people rarely if ever check out their search listings. That's a mistake. Make sure you check your online presence regularly on all of the search engines. You should also monitor online news services, newsletters, blogs, chatrooms and image banks.

2. Build your online reputation before you need it. If you haven't already done so, you need to begin creating search-engine friendly content before a crisis arises. Blog, post to other blogs, create a website, create online profiles (LinkedIn, Facebook, etc.) be active at work and in other activities that will get you mentioned online.

3. Respond quickly to damaging, inaccurate or slanted online content. If you find yourself attacked or worse online, don't hide. You need to respond quickly and authoritatively in the realm where the original content appeared, with clear and open messages and factual information. Tell the truth.

4. Be discriminating. If you participate in social networks, be very discriminating about whom you connect and what content you post!

5. Appeal to the webmaster. Ask the webmaster to remove questionable or defamatory content. Frequently they will.

In some ways, Google is bringing us back to a Victorian age when social circles were smaller and gossip could spread throughout a community like wildfire. There was little or no anonymity in those circumstances and ladies and gentleman had to vigorously defend their reputations because ruination was a real possibility.

The takeaway for trustmeisters: today's professionals live in a google-centric world where rumor and innuendo can be used against them. All the more reason to manage your personal reputation proactively and with care.

Sub-prime Reputation = Failure to consider the "long tail” of customer relationships. (By Paul Allen)

2007-06-19T18:27:00.000-04:00

Doesn’t it seem as if the mortgage business is always in the news? Well, that’s because it is. After all, the industry is connected to interest rates, demography, real estate values, state and federal regulation, tax law, design trends and personal tastes, just to name a few.

But when the mortgage business hits the airwaves and really pings a nerve, it’s about reputation and trust issues. And lately there’s been a growing perception that this is an industry of hollow promises trolling for short-term profit.

As chairman of one of the country’s larger independent advertising agencies, I think a lot about marketing claims. Probably too much. And I don’t like some of what I see in this industry. “Low or no closing costs and fees” are among the evergreen promises and part of the lure to seek financing. And almost without question, where one cost seems low, there will be another price to pay somewhere during the life of the mortgage. Which brings me to the industry’s current challenge: the sub-prime lending scandal.

Cheap, easy money makes for a powerful claim and is an intoxicating thing. For consumers, it makes the previously unaffordable seem within reach. And the current collapse of sub-prime lending practices is a vivid demonstration of what happens when the lust for a cheap mortgage transaction completely clouds the realities of long-term home ownership. Which, by the way, is really the business mortgage brokers are in (or should be) – affordable, long-term home ownership. Not pseudo-cheap, short-term, largely undisclosed financing schemes.

Just the name “sub-prime” reeks of something low. And guess what, it is. (I, for one, wouldn’t eat “sub-prime” beef). So one lesson learned here is that clever financial engineering won’t create a sustainable market if it’s constructed to feed itself, but starve its customers. Literally.

How could this happen? One reason is that the evolution of sub-prime lending from a local niche business to a national and global market ultimately shifted the incentives. Lenders transferred their risk from their own balance sheets to Wall Street investors. And pretty soon, lo and behold, no one was paying attention to the fundamental credit risk of the underlying loans themselves. Who were these people borrowing the money and could they pay it back if interest rates rose?

We now know the answer was “no.” But the most important impact of the “sub-prime” lending scandal is not losses from defaulted loans, but losses from defrauded lives. Families are losing their homes, their pride and their future belief in what they can achieve and own as part of the American dream. And that, my friends, will undoubtedly wreak havoc on the reputation of those who perpetrated the “sub-prime” model. (For some gory details on communities destroyed by “sub-prime” lending click HERE.

Despite veiled attempts to dodge accountability, the sub-prime culprits will become visible. Unfortunately for the basically decent and prudent companies in the financial services industry – and there are still many – the “ball and chain” of public distrust has gotten heavier.

It is interesting to note that some well-known institutions executed their sub-prime strategies through specialized divisions that did not bear the name of their parent brand. One example appears to be AIG, a relatively high awareness, high-quality brand that has lost significant reputational capital in recent years.

So have you heard of Wilmington Finance? They are the AIG unit that originated sub-prime loans that ignored consumer-protection issues and were “slapped by regulators.” In a web-based world affording much greater transparency, if Wilmington was “slapped”, then AIG has been slapped as well. Its reputation again tarnished. Big time.

This is only one of many similar set-ups that are easy to identify and dissect by those who are considering doing business with a lending institution.

So what are the reputational lessons here for corporate trustmeisters?

1. Keep the end consumer’s welfare top-of-mind. Transactions create outcomes between people, not just institutions. Positive reputation, trust and loyalty are in the minds of the customer, not simply in the signed contracts or the “done deal.”

2. Consider the Long-tail. It is imperative to think through the long tail of customer relationships. Today’s purportedly satisfied customers can turn into tomorrow’s reputational nightmare. Thinking through the sustainability of a business promise over the length of a customer relationship is an imperative. How many companies do this in their quest to meet quarterly results?

3. Understand Your Reputation Value at Risk (VAR). The violations of trust that can tarnish reputation live long in customer memory. Sales-prevention could last well beyond traditional business cycles and impact future growth across your brand portfolio. So identify the risks and make sure you properly address all the issues, both the convenient and the inconvenient.

In the end, this mortgage debacle could give rise (hopefully) to a new breed of hyper-transparent players - firms who will make clear how the financing mechanism works, take steps to ensure the long-term success and viability of every transaction, and deeply understand and respect the responsibility of being in the affordable home ownership business.

Managing Reputational Risks across the Global Supply Chain (By Jarvis)

2007-05-30T14:56:00.000-04:00

In the wake of well-publicized poisonings from pet food, toothpaste and drugs, China is now widely believed to have a food safety problem.

And the “Brand China” trust problem threatens their place in the global supply chain. Do you find yourself checking the country-of-origin labels in the fruit and vegetable section at Costco? In the same vein, one wonders how long it will take for pet food brands to begin touting “all-American made” ingredients.

What’s happening in China highlights a key principal applied by the Trustmeisters here in the Reputation Garage: Trust problems are at their heart organizational performance issues. To mitigate the risk of a serious trust event, you must put reputation into a performance management framework – managing it with the same rigor applied to other performance issues, such as quality and cost control.

And, yes, China is taking action. Step one in their trust recovery program: Show that you are serious about the corruption that led to the problems, in this case by sentencing to death the head of your food and drug oversight organization. To maintain decorum, we’ll give no comment on this one, but we could! Step two: Increase public protection by setting up a national food recall system. Step three: Communicate concern and your willingness to work and dialogue with interested parties across the global community.

China’s fix is of course reactionary – these are moves taken to dampen an escalating crisis of confidence amongst both producers who source in China and their downstream consumers. It will take months and years before the effectiveness of any changes is known.

The more important question for would-be brand Trustmeisters is this: How confident are you in your ability to police the behavior of your overseas suppliers? If the answer is “not very,” then be prepared for some potentially nasty consequences.

Just look at the impacts of the recent crisis on the U.S. pet food industry:

1) A costly recall.

2) Announced programs (expensive ones presumably) by some companies to test all of their ingredients.

3) Widespread bad publicity that has not only damaged brand trust, but also alerted consumers to the fact that many pet food brands are really just re-marketers of the same globally-sourced ingredient mix. This will likely send more pet food brands into the off-price commodity bins at places like Wal-Mart.

4) According to today’s Wall Street Journal, weaker companies may not survive this crisis, and we should expect to see further consolidation in the pet food industry as stronger players capable of imposing more rigorous quality control gobble up the also-rans.

A word to the wise: China’s recent problems will not be the only road bumps over the course of what many economists are calling China’s century. Which is why we never tire of saying it: Hope is not a strategy. If you haven’t put the issues of trust and reputation into a performance management framework, what are you waiting for?

5 Ways to Prevent a Reputational Disaster (by Paul Dunay)

2007-05-24T08:52:00.000-04:00

Lots of brands are finding out the hard way that there are plenty of conversations taking place about them online. For good or bad.

Many brands choose to ignore this. But hope is not a strategy.

Since consumers rely heavily on the Web as an authoritative source of information, managing a brand's online reputation has become a top priority for companies. Here are 5 tips from The Reputation Garage's "new technology" archives. They could help you avoid a major disaster and reduce the risk of a flogging in the blogosphere.

Tip 1: Monitor the New Conversational Terrain

You have to be listening. As Woody Allen said, "half of the battle is just showing up." Create a custom feed based on keyword searches using tools like Technorati, Feedster, IceRocket and news.googlecom.

Tip 2: Measure

Agencies like Nielsen BuzzMetrics and TNS Cymfony (trackback to a podcast on how to measure the blogosphere) have more advanced tools for monitoring social networks, blogs and communities. They also can measure the volume of buzz, track the sources and gauge the emotion of the content, be it positive, negative or just sarcastic.

Tip 3: Engage

If you don't join the conversation, you have no control. We'll say it again: hope is not a strategy. Tools like BuzzLogic can give you a picture of a blogger, as well as the influencers that surround any given blog. Also sites like BlogInluence.net and SocialMeter.com can provide a snapshot of any blogger's street cred.

Tip 4: Buy Keywords?

Yes. If you do end up with a firestorm surrounding your company or brand, why not buy keywords and get your story told? Jim Nail from Cymfony says "for a company to protect its brand, they should be buying keywords." Consider Wal-Mart as the classic example. "Wal-Mart Sucks" yields negative results for the first 10 listings. So why not own those keywords as paid links to sites that put Wal-Mart in perspective, covering, among other things, the company's substantial economic benefits to society?

Tip 5: Use PR to Strengthen Your Digital Footprint

Another obvious tactic would be to issue a series of press statements to address whatever the concerns are, and optimize them for the Web. Consider using a press release distribution company such as PRWeb, which sends releases to journalists' email boxes and makes them Web ready. This will help increase the rankings in news engines such as Google News, as well as in the general search results. When a press release ranks high in a search engine, it's just one more spot a negative listing won't appear!

You say you love me, but... (By Jarvis)

2007-05-22T11:15:00.000-04:00

The funny, short video below says a lot about the state of relations today between marketers and customers. It’s a break-up scene. Ms. Consumer wants a divorce from Mr. Advertiser. And just like the dissolution of many relationships, trust has broken down.

Some of “Ms. Consumer’s” grievances:

“You’re saying you love me, but you’re not behaving like you love me. You’re not genuine.”

“You do all the talking…. It’s not exactly a dialogue.”

The video exposes a fundamental issue for companies looking to build trusted customer relationships: We now live in a “show me” marketplace where our words are increasingly disbelieved.

The Break Up
Uploaded by geertdesager

Piper Jaffray’s recent analyst report on the new advertising ecosystem (The User Revolution) highlights some of the problems plaguing advertisers.

• The effectiveness of one-way advertising messaging has been collapsing around the world. Its influence on customers is more and more suspect.

• Content is increasingly controlled by users, who are either designing their own or mixing information sources to their preference.

• The consumer decision process is changing radically. In the new age of information transparency, products and services are selected based on expert reviews or peer recommendation, not because of the marketing or sales message.

And if you’re a business-to-business marketer and think you’re immune from all this, think again. A recent study sought to identify the trusted sources of information among sophisticated corporate technology buyers. Only 3% picked the vendor itself as the most trusted source of information. Analysts took top billing.

So what’s the fix for marketers? Better spruce up your influence-building skills on all levels.

Do agencies get it? Many think not. We can report, however, that this clip was passed along to the Garage from the folks at Allen & Gerritsen. So at least one agency gets it.

Galapagos. “The archipelago of good behavior” (Paul Allen)

2007-05-17T08:28:00.000-04:00

In his last post, fellow Trustmeister Jarvis Cromwell made mention of my recent journey to the Galapagos Islands. My wife, 13-year-old daughter and I had the good fortune to go on an expedition to this isolated archipelago; one of the most remote, unique and protected ecosystems on this planet.

The reputation of Galapagos* precedes it. It is the land of Darwin and his many finches. It is home to endemic flora and fauna found nowhere else on earth. It is made of active volcanoes. It is at the crossroads of four major ocean currents converging 600 miles off the coast of Ecuador. It is a very cool place that a lot of people feel is important to experience in their lifetime.

I, for one, couldn’t agree more.

Like any vacation, this trip was planned as an escape; an immersion into an environment so interesting and stimulating that it left daily concerns irrelevant and quietly tucked away for another time. But, as it turns out, Galapagos dramatically brings to life fundamental qualities that cross traditional borders between the personal and professional. So it was more than vacation; it was a looking glass in which to view our own relationships, priorities and actions.

Pretty heavy stuff, eh? Particularly for a vacation.

So what are these “fundamental qualities” and what the heck has this got to do with the Reputation Garage? My answer is that what I observed and experienced in Galapagos are at the core of managing reputation – observed unfettered and uninterrupted. They are:

1. Unspoken Trust.

Perhaps the first and most startling impression made by Galapagos is the fact that the creatures who reside there have no fear of man. None. To be among sea lions, marine iguanas, blue-footed boobies, and white-tipped sharks (to name a few) and be accepted as unthreatening was a remarkable experience. Sea lions would curl up on guests’ beach towels. Galapagos mockingbirds would sit on your hat. Giant sea turtles permitted a swim beside them. Penguins dried themselves on warm lava rocks and posed for your photos. Nobody fled. Everybody behaved naturally. No one violated personal boundaries (touching the animals is forbidden).

There was trust in the air. Very refreshing.

This aura of unspoken trust very quickly permeated the expedition group, our tour leaders, and other indigenous life to make us one in the mission of comfortably, naturally and permanently being enriched by Galapagos.

Talk about team building.

2. Unwavering Stewardship

The enchanted, trustful world of the Galapagos is no accident. It is the result of a number of organizations, private and public, all over the world deciding what guidelines would foster and preserve this ecosystem. The implementation of these guidelines is unwavering. Visiting Galapagos is only possible in the company of licensed guides and their organizations - dedicated individuals who have decided to make the sustainability of the Galapagos their vocation; accepting the responsibility of educating while guiding, of protecting while making things accessible.

Perhaps the most powerful example of this stewardship was when, on one trek, our naturalist stooped to pick up something miniscule on a trail to place it aside, off the trodden path. Invisible at a glance, we asked what he moved. It turned out to be an insect. Endemic to the islands. An important part of the food chain. One that should not be altered by an errant Teva.

Excellent attention to detail. No "green lipstick" here.

And while the rules of visiting first seemed limiting, it became starkly apparent that it was exactly these rules, and the unwavering stewardship of the naturalists, that would make our Galapagos experience as connected and authentic as it was.

(Interesting to think about how good guidelines can make things more authentic.)

3. Respectful Behaviors

One of the creatures talked about often during ship-board lectures was us – human beings. We were mostly referred to as the “world’s most invasive species”. Great pain was taken to illustrate that in order for ecosystems to thrive, humans must be managed accordingly. Otherwise, for sure, we will begin to behave badly and do something counter-productive. Guaranteed.

So emerged the notion of respectful behaviors. Not just between humans and the other species present in Galapagos. But amongst the variety of humans who chose to participate in this expedition and experience the Galapagos. The crew and guests of the MS Polaris** (our expedition ship), men, women and children, from age 90 to age 8, regardless of demographic or socio-graphic background, all learned how to respect and be respected in their Galapagos experience.

And that, my friends, is good behavior.

This brings me back to the reputation thing. As a Trustmeister here in the Reputation Garage, I felt the need to share these three dimensions of reputation as experienced in Galapagos. Personally, I find them to be highly actionable experiences. My hope is that reading this may cause you to think about these issues in a more palpable manner. And perhaps ask yourself some questions.

How does one foster unspoken trust in life and in commerce?

What kind of colleagues make for an unwavering commitment to an organization, belief or cause?

When does mutual understanding and unexpected common ground act as catalyst for enjoyable and respectful behaviors?

Important questions, I think, on the road to a good and strong reputation.

I started this post by noting that the reputation of Galapagos preceded it. Now for me, it follows it. More alive and vibrant than I expected and imagined. The reputation of Galapagos was eclipsed by the visit itself. How often does that happen? Imagine making that happen for your business, and your life. Sounds pretty good.

So at the end of the day, people ask me a simple question.

Q: “How was your trip?”

A: “It was a privilege.”

Q: “What do you mean a privilege?”

It was a privilege to see three vital forces at work in their most primal, passionate form: unspoken trust, unwavering stewardship and respectful behaviors; indelible images that will influence my personal choices and professional endeavors moving forward. And maybe, through this post, yours too.

“Good reputation is a privilege and an increasingly precious commodity in our trust-starved world.

Create it. Live it. Protect It.”

____________________________________

Notes

*the locals never precede the name with “the” – they speak it as a living name – these islands are simply “Galapagos”.

** in the spirit of spreading some good reputation information – our trip was run by Lindblad Expeditions aboard the MS Polaris. They did an exemplary job exceeding all
expectations on a “high-expectation” trip. You can check them out at www.expeditions.com.

Greener Barbie Doll at CRO Conference (by Jarvis Cromwell)

2007-05-11T23:29:00.000-04:00

A few of us attended the CRO Conference in New York this week. This new organization dedicated to best practices in corporate responsibility already has 15% of the Fortune 500 signed up and it’s growing fast.

The meeting offered plenty of performance take-aways that organizations of every stripe can learn from. Here are a few that we’re chewing on back here in the Garage:

1) Some of the smartest companies are driving their sustainability practices from the outside in, with the customer firmly in sight. (Peter Drucker would have been proud.) Mattel, for example, is not only implementing a more sustainable packaging strategy for “Barbie”, they have eased a big customer frustration: having to cut, pry, twist and pull Barbie out of her well-bolted, plastic shrine. See a fun CNBC clip on Mattel’s strategy here.

2) Not one, but two Fortune 500 CEOs advised that when addressing sustainability issues an important starting point is to deal with the facts -- both the convenient and the inconvenient. Then focus on continuous improvement, not instant perfection. Funny how if you strip away the hype and just “get after it”, profits and greater good can come of it.

3) OK, full disclosure, this was a green crowd, but there was thoughtful consensus that it’s a myth that green practices are the enemy of profit. On the most basic level, what company wouldn’t want to reduce costs through less fuel, less water? And did we mention that Mattel’s stock price has been on a tear over the past year?

4) Long-term solutions to many sustainability issues are not going to yield short-term gains. That’s a problem, and a big topic. And it relates to what we refer to here in the Garage as The Math Problem. More on that another day.

5) Climate change will be profoundly important in accelerating both business growth and new wealth. Of course for some, the grim reaper of economics, “creative destruction,” will be in play. What companies are headed for a rough patch? The panel of experts – all consultants trying hard not to offend – demurred. Oh, wait a minute. The word “Detroit” slipped out. And it was predicted that water-intensive agriculture is going to die faster than anybody currently expects.

As fellow Trustmeister Paul Allen has just gotten back from the Galapagos Islands, we can’t help but paraphrase the famous Darwin insight here: “It’s not the strongest that survive, but those that are best able to adapt.” You can read his dispatch shortly.

Finally, one of the biggest points for trustmeisters that came out of the conference: If you don’t know what it is you need to do to have your reputation aligned with your publics, you’re courting real trouble.

Enjoy the weekend.

Should you apply the green lipstick? (by Samantha Taylor)

2007-05-07T16:11:00.000-04:00

There is a lot of lip service being paid to the environment by marketers of all stripes. Is it authentic? A ‘greening of business’ cover story in Advertising Age (here) suggests the answer may be no in some cases.

For marketers, the more important question is whether or not donning “green lipstick” will ultimately pay off down the road.

Not if you’re not real about it.

According to Ad Age, while companies are flocking to add green to their marketing platforms, their true environmental conscience is being questioned. Hmm. The issue of consumer distrust that haunts marketers at every turn seems to be in play here. The learning for would-be trustmeisters: It takes a lot more than clever advertising to convince consumers that you’re serious about embarking down the road of sustainability.

Examples of companies who are doing more than wearing the green lipstick include Intel and GE. Both are developing sustainable programs. Will such emphasis pay off for them? GE says it will grow revenues that provide some kind of environmental benefit to $20 billion by 2010.

GE is being more authentic than most, but it still has its critics. Our take here is that as companies engage more actively in issues of societal responsibility, they also must beef up communications programs – with particular emphasis on dialoguing with stakeholders and critics alike.

We expect to see continuing debate in executive suites on what to do about this issue, particularly because in our view the payoff potential can be significant. Considering that $179 billion was invested in socially responsible mutual funds in 2005, moving beyond mere conscience touting seems not only sensible, but profitable.

Fellow trustmeister Jarvis Cromwell points out in a previous post (here), that the LOHAS consumer segment is a growing and highly desirable market. New industries will emerge, and reputations and empires will be built, as we see the greening of corporate America.

And need we say that future generations are depending on it?

Less lip service please. True brand trustmeisters will do more by re-engaging with nature, science and the bottom line in an authentic way.

Our advice: Don’t move forward on green efforts until you’re ready to be real. That means first aligning causes with business operations and stakeholder communities, and then backing your actions up with strong communications.

Search vs. Social Media, a podcast with Adam Lavelle and Paul Dunay

2007-05-02T16:59:00.000-04:00

Search engine marketing has become a mainstay of any marketing department and a must-have in any integrated marketing plan. But did you ever wonder what all the new social media is going to mean for the search engine marketing industry? Good, then this podcast is for you!

I conducted an interview with Adam Lavelle, Chief Strategy Officer of iCrossing, a search media company that is answering these questions and more. Listening to Adam will give you a taste of just how Google will become a "reputation management" system and how you need to be prepared.

About Adam

Lavelle oversees all client-related strategic services for iCrossing. He focuses primarily on leveraging the company’s search and consumer insights to develop marketing solutions to client challenges. Lavelle has more than 11 years of interactive expertise helping clients succeed online. He began his digital career at The Internet Group in 1994 when Mosaic was the browser of choice, where he led the first launch of Mapquest.com. Lavelle has a B.A. in Classical Studies and Creative Writing from the University of Pittsburgh.

The Venom of Crowds (Paul Dunay)

2007-04-30T19:10:00.000-04:00

Nastiness can erupt online and go global overnight. If' it's directed at you, "no comment" doesn't cut it anymore.

Most companies are totally unprepared to deal with the new e-nastiness. That's worrisome as the Web moves closer to being the prime advertising medium—and reputation conduit—of our time.

Trashing brands online can also be a sport. Witness the faux ads bashing the Chevy Tahoe as a gas-guzzling, global-warming monster. Millions of people watch this stuff then pile on. Is it any wonder companies lose control of the conversation?

When the Web turns against them, executives face the problem of how to manage the blowback. They have two choices: ignore the smaller furies and hope they won't metastasize, or respond outright to the attacks.

Companies such as Lenovo Group, Southwest Airlines, and Dell now have specialists dedicated to engaging or co-opting their critics. Other businesses hire firms such as BuzzMetrics or Cymfony. Those outfits use algorithms to analyze which bloggers and social media are driving the conversation around issues that matter to marketers. (Trackback to my podcast interview with Jim Nail of Cymfony)

New premium service providers claim they can promote the info you want and suppress the news you don't. Some say they can make information disappear altogether!

But we know better, of course. The Web is like Whac-A-Mole. For every proactive move, another crisis can flare up elsewhere.

Where is all this headed? I believe anyone's 15 minutes of infamy is no longer something that gets buried in the sands of time. Google changes all that, and "ruined for life" becomes a very real possibility. Even if you can rebuild your reputation, missteps cost plenty and take a heavy toll on individuals and businesses.

To learn more listen to my podcast with Chief Strategy Officer of iCrossing Adam Lavelle coming up later this week.

Brand Trust Was Missing from Friedman's Playbook (Jarvis)

2007-04-24T11:41:00.000-04:00

We find Andrew Zolli one of the more interesting and relevant futurists out there these days. He recently wrote a great piece in Fast Company (here) that kicked off with a quote from renown free-marketeer Milton Friedman:

“There is one and only one social responsibility of business”, Friedman wrote back in 1970, and that is to “engage in activities designed to increase profits.”

As soon as we read this quote here in the Garage, we knew that Zolli had nailed it: Friedman’s pronouncement marked a watershed moment for global business, a tipping point for the guiding principal of the era: profitable self-interest would prove to be the only reliable endgame.

And everyone knows how things played out with the help of Friedman’s compass. The rise of the activist shareholder movement. Reagan-era deregulation. Michael Douglas’ declaration that “Greed is Good” in the movie Wall Street. The tearing down of the Berlin Wall. The creation of the Jack Welch rules of management.

All of this and more helped companies achieve higher performance throughout the 80s and 90s. “Mr. Market” surged, helped along by a long-term decline in interest rates and a speculative bubble or two. A lot of executives (and shareholders) grew rich.

Greed took a victory lap. Capitalistic self-interest flourished. Customers got better and cheaper products. All in, Friedman’s playbook worked.

Of course, playbooks rarely cover all the bases equally well. Which brings us to another quote, this one from advertising icon David Ogilvy:

“The customer is not an idiot, she is your wife.”

The point Ogilvy was making is that you can’t pull the wool over your customers’ eyes. They notice everything and apply their observations with keen self-interest. And today, with only 13% trust levels in business, the customer seems to be saying: “Yes, yes we get it. Big companies have improved performance greatly, but they are not in the game primarily to benefit us." And this means that companies live in a world where the customer may buy from them, but probably doesn't trust them and may not like them. And the key point for management? Low trust changes the nature of virtually every transaction -- for the worse. Just ask Michael Dell. It's a headwind you have to take into account as you steer the business.

All of this brings us back to Andrew Zolli and the title of his Fast Company piece: “Business 3.0: The oblivious Capitalist’s Days Are Numbered.” In this case he casts his eye to the future and the environment and concludes that a host of global forces will force a remake of the playbook for business success. Business will profit by driving a wider social agenda and “the clinical, value-neutral capitalism of old” will fall by the wayside.

We agree. Long-term growth has always come down to this: finding and keeping customers at a profit. And the playbook now requires companies to place greater attention on building trust and reputational performance. GE, Toyota and other leaders are already well on their way towards profiting from the wider social agenda.

As one example, product value propositions are being stretched by companies of all kinds to appeal to the LOHAS segment (i.e. customers who focus on lifestyles of health and sustainability.) These folks do yoga, buy Energy Star appliances, drive hybrids and read books by Andrew Weil. And guess what? There are some 50 million of them out there paying a premium for products. They make up an estimated $228 billion market and are growing.

In the LOHAS market, the reputational performance of the company you do business with matters. Further evidence that for aspiring corporate trustmeisters, it’s time once again to reinvent the playbook. After all, that’s why we’re here in the Garage, isn’t it?

Saturday Extra: Daily Show Post

2007-04-14T16:18:00.000-04:00

We got some emails regarding yesterday's post on the problems of Messrs. Imus and Wolfowitz. One reader wanted to know what Daily Show segment we were referring to. Hey, this is professional blog! Then again it's Saturday -- a time when the trustmeisters here in the Garage turn up the boom box and kick back a little.

So here's the Daily Show piece. Enjoy!

So Don't Do That! (Jarvis)

2007-04-13T18:05:00.000-04:00

It’s easy to grow callous over the daily scandal sheet. On this week’s critical-care list: World Bank President Paul Wolfowitz. And for shock jock Don Imus, the lights have now officially gone out.

But so what? While Wolfowitz and Imus are clearly victims of their own bad judgment, the learning for the reputation-minded can be summed up in an old Marx Brothers bit:

“Doctor, it hurts when I do this.” (Gesturing with arm.)
“So don’t do that!”

At first blush, the cases appear quite different. Radio's famous bad boy Imus was dethroned by his notoriously noxious tongue – a thoughtless joke, he says, gone terribly wrong. The Daily Show had some fun, saying Imus offered up an excuse for his remark: he doesn’t have a PR agent.

PR can’t help much once the genie is out of the bottle.

To other matters, Wolfie, as our President likes to call him, may also lose his job - in this case over more than a slip. Indeed, a series of bad decisions could send him packing.

A quick recap of the Wolfowitz case: boss gets girlfriend generous pay package and transfer. Boss claims he got approval for his actions from the ethics committee. That claim is later called into question. Boss apologies for the mistake. Board deliberates boss’ future.

Both “trust events” will cost plenty. The Imus show brought in an estimated $20 million in revenue to CBS last year. That's gone poof. And then there’s the issue of management distraction. The growing controversy at the World Bank has overshadowed major development meetings taking place this weekend. And it has also caused further turmoil among staff, who have called for Wolfowitz’s resignation.

According to the Financial Times, the scandal has jeopardized the one asset the President of the World Bank has: his credibility. Indeed, Wolfowitz has been mistrusted by many both inside and outside the bank since his appointment. All this makes it harder for the World Bank to do what it's supposed to do: fight global poverty and raise the world’s living standards.

The take from this Garage “trustmeister” is that Groucho’s advice is sound. Don’t do that. Reputational risk is real and companies need to find effective ways to mitigate poor decision-making. Large organizations are especially vulnerable to dangerously myopic judgment. What’s often missing is a zoom out lens. In other words a mechanism to help companies look out from the point of decision and understand its impact on brand reputation.

It’s a necessary practice, whether your talking about a brand, a company, a CEO, or a shock jock.

Why we started the Reputation Garage (Jarvis)

2007-04-07T12:58:00.000-04:00

The world’s business community has reached, well, let’s just call it a low point: Practically nobody trusts big business. (In the U.S. the number who say they trust big companies and brands hovers around 13%)

So the intent behind this blog is as simple as it is ambitious: We're an experienced group of professionals who want to help change the dismally low worldview of business. We are pushing for a new era of business performance - where companies and their brands are trusted more than they are today. (Along the way, we also expect to see continuing seismic shifts in marketing practices as we know them.)

Our merry band of “trustmeisters" includes yours truly, a consultant and former big company CMO who is known for his thinking on this topic; a U.S. ad agency chairman who questions the efficacy of many traditional marketing programs and practices; a corporate social responsibility expert and U.K. native who has also served as co-head of the U.S. branding practice for a global communications firm; and a leading thinker at the intersection of marketing and technology whose day job happens to be at one of the world's leading consulting firms. We'll be adding more trustmeisters as we go along.

Are we out to change the world? No, but if trust matters, then a lot of organizations are not supported by strong footings. More importantly, a majority of customers and employees around the world are expressing unhappiness with the current state of affairs. That doesn't exactly spell brand power or, to use the catch phrase of the moment, employee engagement. Because traditional practices have failed to prevent or solve these problems, new ideas and actions are called for here.

So for the record, trust matters. Indeed, if you’ve attended any of the last several World Economic Forum meetings in Davos over the past few years, you know that there is significant hand-wringing taking place over this issue. When trust declines, the nature of virtually every exchange and transaction is altered. Brands, which are built on trust, lose value. Sales become harder to generate. Customers defect, as loyalty deteriorates. Employees disengage from their jobs and the company mission.

So where's the fix for organizations looking to improve upon this sorry state of affairs? Join us here in the Garage as we uncover, evaluate and share emerging new ideas and solutions for what may be the most important marketing issue for our times.

2007-03-27T16:21:00.000-04:00

Welcome!

We're glad you've joined us at the Reputation Garage. We're just getting underway and our first post will be coming at you shortly!