Argyle Public Relationships

Six insights on reputation – from Canada’s most reputable companies

By Daniel Tisch

/ Posted in Reputation

BlogPosts-Dan-RepInst-21 Jun 16

Great products are not enough; reputation flows from being seen as a great company
Last week, Argyle Public Relationships had the exciting opportunity to unveil the 2016 list of Canada’s Most Reputable Companies with our partners, the Reputation Institute. Based on 40,000 ratings by Canadians, the research proves that having great products are not enough; reputation flows from being seen as a great company.
As we announced the results in Toronto with Charles Fombrun, founder of the Reputation Institute, and Brad Hecht, the RI’s Chief Research Officer, I gleaned six insights from Canada’s most reputable companies:


  1. Reputation is about both the heart and the mind: it’s an emotional bond – reinforced by rational experience. One of the strengths of the Reputation Institute’s model is that it looks at both, with 40,000 ratings by Canadians who claim familiarity with these companies. Some companies do well emotionally but the rational experience does not match up – which creates risk; where the reverse is true, there’s opportunity.


  1. Investing in reputation pays off – massively. The Reputation Institute’s research proves that a five-point rise in reputation results in a 6.6 per cent increase in recommendation – and the jump is even greater when an average reputation becomes a strong one. Reputation also matters to investors: the value of the most reputable companies drops less in a crisis; the most reputable firms are more profitable, and grow far more quickly.


  1. The most reputable companies in Canada are global, creating new challenges for Canadian brands. The pre-eminence of international brands — led by Lego and Campbell’s — has occurred gradually but inevitably, as we operate in a more globalized world and Canadians claim increasingly more diverse origins and influences. Canadians are also hard markers: we don’t rank a single home-grown brand as excellent – but Home Hardware, Porter, Tim Hortons and Westjet are all in solid B+ territory (75-77%). Canadian brands have to position themselves in the consumer’s mind not just against national competitors, but also global ones.


  1. A company’s reputation can be helped or hurt by its industry – so industry positioning becomes critical. For example, the consumer products and transportation industries have strong overall reputations, while the energy and financial industries do not. For firms in less reputable industries, this suggests that visibly outperforming the category, helping to raise the category’s reputation, and positioning a company positively against its industry — can have huge benefits.


  1. Canadians really care about the companies behind the products – especially a company’s conduct and citizenship. Less than one-third of reputation flows from products and performance; the rest comes from the company behind the products – particularly qualities such as governance, citizenship, leadership and our perceptions of how they treat their employees. Governance (how the company behaves in the market) and citizenship are particularly important to Canadians. Smart CEOs, CCOs and CMOs will increasingly seek to move these drivers of reputation.


  1. To move reputation most, target the ‘fence-sitters.’ 50-65 percent of respondents were uncertain about what companies were doing across the seven dimensions – with the greatest unknowns being the companies’ workplaces, citizenship and governance. Pulling these levers could have a disproportionately powerful impact on a company’s reputation by moving ‘fence-sitters’ into its camp.

To predict how this might play out in the marketplace, the airline industry may be a good bellwether, with Porter Airlines enjoying the narrowest of reputational edges over Westjet. Porter’s advantage rests on a healthy lead in perceptions of its product, while Westjet leads in perceptions of its governance, workplace and citizenship. These Canadian challenger brands should invest in maintaining their relative strengths, and communicating aggressively to shore up their relative weaknesses.
The evidence is clear: when it comes to reputation, who you are is more important than what you sell. The greatest companies of today are investing in the relationships that drive their reputations; those that do so tomorrow will surely claim the leading brands of the future.
About Reputation Institute 
Reputation Institute (RI) is the world’s leading consulting and advisory firm for reputation. RI enables many of the world’s leading companies to make more confident business decisions that build and protect reputation capital, analyze risk and sustainability topics, and drive competitive advantage. RI’s most prominent management tool is the RepTrak® model for analyzing the reputations of companies and institutions — best known via the Global RepTrak® 100, the world’s largest and most comprehensive study of corporate reputations, as well as Country RepTrak® and City RepTrak® studies that look at reputation across organizations within a given geography.

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