Holmes Report 09 Jun 2012 // 11:00PM GMT
Who you are is more important than what you produce when it comes to corporate reputation, with BMW, Sony and the Walt Disney Company topping the third annual Global RepTrak 100 list of the most reputable companies produced by the Reputation Institute.
Google, at the top of the list in 2011 and 2010, fell to sixth place this year. BMW is the new leader. New to the top 10 is Microsoft, which pushed out Intel.
“In today’s reputation economy, what you stand for matters more than what you produce and sell,” says Reputation Institute’s executive partner Kasper Ulf Nielsen. “People’s willingness to buy, recommend, work for and invest in a company is driven 60 percent by their perceptions of the company and only 40 percent by their perceptions of their products.”
The study shows that while reputations may be strong in a company’s home country, popularity does not translate easily abroad. While some companies see as much as 95 percent of revenue from foreign markets, only 11 percent of the top 100 companies have better reputations abroad than at home.
“It’s because reputation isn’t something that’s easy to export,” says Nicolas Georges Trad, executive partner at Reputation Institute. “Your reputation is an emotional connection which is built over time. It’s tied to your history and past actions. Exporting that emotion is proving to be very difficult. But, it’s a recipe for success when competing globally,” he says. “Today, companies lose as much as 40 percent of recommendations outside their home markets. This has to change if they want to capture market shares globally. To improve sales, companies must invest in reputation.”
Results also showed a strong correlation between a company’s reputation and consumers’ willingness to recommend it. For the top companies, 55 percent of consumers said they would definitely recommend their products to others, compared with only 22 percent for the companies at the bottom of the list.
“We live in a time where word-of-mouth is the number one driver of sales and competitive advantage,” says Trad. “Investing in reputation will pay off on the bottom line.”
The Top 10:
3. Walt Disney Company