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Corporate Branding

5 Determinants Of A Company’s Reputation


Many people know that reputations take a long time to build and a short time to damage. Several companies are known and admired for their contributions to environmental sustainability and worker welfare. Toyota, for instance, received well-deserved kudos for introducing its hybrid Prius automobile, which gets 50 miles per gallon. GE won praise for its Ecomagination effort to make money by solving environmental problems, having launched green industries such as wind power and solar panels. Starbucks is admired for using purchasing practices that help coffee farmers achieve a decent income, and Reebok was the first in its industry to adopt standards for fair treatment of workers.

On the other hand, there are certainly enough examples of companies that draw criticism for their indifference. Walmart periodically gets into the news when its employees loudly complain about low pay and the lack of benefits. Nike had a public relations disaster when it was discovered that its overseas manufacturers were using child labor.

One needs to look at five questions when rating a company’s overall reputation:

  1. Does the company produce good or excellent-quality products and services? If the answer is no, there’s no need to ask any of the other questions.
  2. Does the company show good profits over the long term? If not, people aren’t likely to trust it.
  3. Does the company have good management or visionary management, or are its leaders asleep at the wheel?
  4. Does the company have dedicated employees, suppliers and distributors? This will come across in good teamwork and satisfied stakeholders.
  5. Does the company exhibit social responsibility in a meaningful way? This last question adds another level to the company’s overall reputation.

Contributed to Branding Strategy Insider by: Philip and Milton Kotler, excerpted from their book, Market Your Way To Growth with permission from Wiley Publishing.

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