The good people at Harris Interactive, the global research consultancy, recently released their snapshot of our collective discontent with corporate America. The 2012 Reputation Quotient (RQ) survey, a survey of 18,000 Americans now in its 13th year, tracks the perception of America’s most visible companies and produces an RQ score for each.
This year’s batch of RQ scores is troubling to say the least. Less than 20 percent of those polled viewed corporations positively, and 60 percent felt corporate reputation had declined. The number of companies with “excellent” reputations, as determined by Harris, fell by half from last year. Financial services and banking companies came out of the survey badly bludgeoned; Bank of America, AIG, Berkshire Hathaway, Wells Fargo, JP Morgan Chase and Goldman Sachs suffered the worst drops in RQ scores on the entire list.
It should be noted that, historically, companies whose RQ score drops below 50 run a significant risk of being taken over by the government or going out of business. Bank of America, AIG and Goldman Sachs – the trinity that fall in this warning range – should consider the carnage of corporations that Harris found to have similarly abysmal RQ scores in the past, including infamous flameouts like Enron, MCI, WorldComm and Global Crossing, as well as mangled brands like Halliburton, Fannie Mae and Freddie Mac.
What can be done about this and can the government help?
Whatever your politics, the Harris survey suggests Americans believe the government is inept at the bailout gig. Government – polling lower than tobacco, financial services and banking industries – ranks dead last in reputation with a whopping 76 percent negative rating.
Those who wish to restore the waning image of corporate America – and government for that matter– should look to Google and Apple, which top the Harris survey with the highest RQ scores. These companies derive their brand appeal from their undeniable ability to stir emotional appeal in consumers. How can we explain the fervor for Apple versus the vitriol for banks?
Our country’s greatest brands share common traits. Like Apple and Google, they hold emotional appeal for their consumers. Kodak is an example of a company that lost its way; however, it wasn’t when people stopped buying film, but when they forgot Kodak’s mission was always to help people capture memories. Apple gets this. Does Goldman Sachs?
Great brands also buy into corporate social responsibility (CSR). For them, it is not a line item in the public relations budget – it’s in their DNA. For example, Starbucks’ CEO Howard Schultz made a bold and brilliant decision last year to sell wristbands in his stores to provide capital to American small businesses. “If banks wouldn’t do it,” he thought, “why can’t we?”
So why do we have such a pessimistic view of our nation’s companies? In the business of doing business, it would seem that many American companies have become devoid of a larger purpose and commitment to the public good. True, just about every company nowadays has some kind of flashy marketing campaign or a new CSR initiative. But the public, as evidenced from the survey, knows the difference between the real thing and a façade.
The rising RQ scores of auto companies, once so maligned, is proof that rebuilding a tarnished reputation is possible. In the age of social media, this feat has never been more possible. But the stakes are higher. Today’s consumer has instant access to abundant, raw information, and demands more from a company than simply a product. Emotional appeal, according to the Harris survey, stands alongside financial performance and products and services as key factors in overall RQ scores.
The brands that struggle in the marketplace of perception must do more to leverage social media, embrace CSR and offer a bigger vision of themselves in the world. They need to do more than simply make money. In the end, consumers want to buy more than just a product.