A company’s reputation could easily make or break it. In fact, studies have identified a positive correlation between performance and reputation, highlighting the inherent importance of the latter. This simple fact underlines the need to protect your brand’s reputation. But how do you achieve this? How do you stay on top of different happenings to prevent reputational damage? Our 2022 guide on how to protect your brand’s reputation offers the answers.
Reputational Damage
The perceptions that your stakeholders (investors, suppliers, and customers) have of your brand’s operations, communications, and performance embody its reputation. Any misstep that negatively impacts their perceptions results in reputational damage.
Often, this originates from glaring gaps between a company’s actions or assertions and what the stakeholders perceive the business to have actually done. This could include negative reviews online, cyberattacks, management misbehavior, employee indiscretion and fraud, and regulatory breaches.
If the company fails to respond to this gap, the extent of the reputational damage becomes irreparable. This can happen in the following scenarios:
- If the business does not keep the record straight with its stakeholders through immediate and clear communication
- Failure or inability to stop negative media coverage
- Lack of an immediate, effective response
- Inability to assuage negative reviews by responding individually to the concerns or working with review sites to remove review spam
Outcomes of Reputational Damage
Given the close association between reputation and performance, it is easy to see how catastrophic reputational damage may be. Reputational damage can cause the following outcomes:
1. Loss of Customers
Firstly, it may lead to a loss of customers. This predisposes the company to liquidity risks as it may no longer receive as much inflow of cash (through sales) as before, making it unable to fulfill its financial obligations. More often than not, this ultimately leads to bankruptcy if the company cannot bounce back.
2. Monetary Losses
Reputation may lead to monetary losses in the form of compensations and lawsuits as affected parties seek justice for a brand’s misgivings. This is a common occurrence in instances where companies knowingly sell defective products. In addition, a brand may have to pay substantial fines to regulatory bodies.
3. Dips in Stock Prices and Market Capitalization
Damaging reports that impact investors’ perception of a brand results in a decrease in a public company’s stock prices and, by extension, its market capitalization. In fact, investors often opt to sell their holdings in such companies, further contributing to an even greater price dip.
How to Protect Your Brand’s Reputation
There are four ways through which you can protect your brand’s reputation.
1. Web Scraping
Web scraping refers to automated data collection from websites. It is mainly carried out by bots known as web scrapers which send requests, receive HTML responses, parse the data (convert it into a structured format), and save it in a file for download. The scrapers can extract brand mentions from social media platforms or review sites. In this regard, they enable you to quickly identify any negative feedback, allowing you to respond with the required immediacy.
And given that search engines index webpages from different websites, you can use a SERP scraper to extract data such as brand mentions from news sites. This way, you can easily identify negative news coverage and address it before it causes reputational damage. Click here now to learn more about the most efficient SERP scraping tool.
2. Proxies
A proxy is an intermediary computer through which internet traffic is routed. It adds an extra layer of anonymity by hiding your computer’s real IP address and assigning you a new identity. You can use a proxy to bypass geo-restrictions as it can assign your computer an IP address associated with any country of your choosing. This arrangement ensures that you can monitor your reputation across borders on an international level.
It is noteworthy that an advanced SERP scraper not only includes data extraction capabilities but is also equipped with additional tools such as proxies and proxy rotators.
3. Honesty
It is crucial to uphold honesty in your communications with your stakeholders, even when it threatens to erode some of your profits. Honesty builds trust, which is fundamental to any rebuilding efforts.
4. Reputational Protection Plans
Public relations 101 requires that businesses always have a predefined crisis management plan. Similarly, companies should have a reputational protection plan in which the staff is trained on how well to respond to negative media coverage or reviews. The training helps them avoid causing even more reputational damage by responding inappropriately.
Conclusion
A company’s reputation is its lifeline. Once eroded, the business may slowly slip into oblivion due to financial losses, a reduced number of customers, a slump in share prices, and more. Fortunately, you can prevent this by implementing protection measures such as brand monitoring using SERP scrapers and web scraping bots, crisis management plans, and upholding honesty.