The brand – as useful as a forgotten icon in a neglected museum.
Just 40 years ago, most large companies saw brands as the prime creators of value, but they did not trouble to assess corporate reputation. It did not seem to create or even affect value. Investors focused on share price, profit, turnover; connections were made through stockbrokers, agents and financial media.
The practice of communications was simple, and essentially one-way. Companies, not particularly interactive, did not acknowledge those we now call stakeholders; communications were dominated by direct advertising, brand restatement and old school advocacy agendas. They were content to declaim, but rarely to discuss or debate issues of substance with external observers and commentators (unless they had to, for example at quarterly reports).
The environment has changed radically since then. Corporate reputation now sets a challenging target for public favourability and raises the standard for genuine corporate responsibility in a way that the brand cannot. For the brand has no arms other than the livery, no legs other than the PR roll out, and no voice except advertising and other outdated one way communications. A brand is only the talk, never the walk.
Reputation is now carved into the pillars of corporate culture. And people’s expectations of companies’ public policy agendas are changing. These expectations are now based on the insight that the value of a company, even to financial investors, is expressed also by its reputation, rather than only by its revenue or its sales. Another way of putting this is that reputation has become one of the primary generators of corporate value where once it was completely irrelevant. A clear public demonstration of a good corporate reputation has become a significant responsibility in itself, and is now close to becoming a due diligence requirement.
The creation of value is to be found at the heart of these new relationships. Today’s new companies and entrepreneurs are leading the way in creating new communications and stakeholder networks by harnessing the power of new media and imaginative capacity building through social and relationship marketing. The brand is shrinking in proportion as the need builds to listen more and talk less.
The function of the brand is therefore changing in response to a media environment that has become almost completely interactive. Tomorrow’s brand will be cast loose from any single product, sector, category or idea. It can no longer express accurately a product in itself to a customer now spending hours on social media instead of the TV.
The brand is now forced to partner with corporate reputation to better express the corporate identity, mission and purpose. It nearly died because people now care more about earned reputation than bought facade and it’s only still alive because of its incidental and probably temporary role in assisting with the main boardroom task of building and maintaining corporate reputation. Very soon, corporate brands and their proud liveries will become as useful as forgotten icons in the dusty corners of neglected museums.