Digital & Social Media

The Thing We Call Brand Just Got a Lot Riskier


What is the new risk for the C-suite today? The concept of “brand” itself has changed.

External forces have created a new environment for companies and brands, and as a result, brand and reputation today must be actively managed as a single source of value and risk.   We don’t have a good term for it, but brand and reputation are now something like “brandutation.” For many organizations, the pressures that fused these two may create a diamond, but can just as easily crush the brand.

Until now, most people in management have seen branding as a defined process: A brand has been a crystalized, repeatable, aspirational concept to be controlled and managed. In the best case, the brand of an organization, product or service has been a true expression of the values of the people behind it. Even with those that fall short of that, the strength of branding as a management discipline has been its forced simplicity and repeatability: Strip away all factors but two or three key attributes, and express those in a differentiated, singular form. Then, cast everything the organization produces from that mold so that the customer would see the same recognizable, positive features and understand the brand promise. For 30 years, it worked for ice cream, industrial equipment, pharmaceuticals and universities.

Today, a brand cannot be isolated, refined and blasted through a communications pipeline to generate a controlled level of audience awareness, as it once was. Consumers and others who influence decisions on purchases now consider elements that used to be outside most definitions of the brand spectrum: What kind of employer is the company? Does it buy from sustainable suppliers? Does it pollute and use recycled materials? Does it pay its fair share of taxes? Is it financially stable enough to be around for warranty service after the sale? Are the company’s executives overpaid? What kind of political donations does the company make, and what policies do the executives endorse?  If the brand represents an institution, like a university or hospital, the questions are similar, and the expectations are even higher.

All of that information, and more is now immediately available, even to customers who aren’t really looking for it. Influential consumers, employees, community activists and policy makers are communicating about it through social media—instantly, globally and irreversibly. Even apathetic buyers who only really care about price can be reached when expectations for a company don’t match personal experience. Even to them, reputation can matter if they think it will affect the value of their purchase.

The impact of reputation rapidly mixing with brand may be good or bad, but it can’t be stopped. The expansion of social media and digital repositories of information are to blame.  The brand and reputation fusion also was compounded by the recent global recession, kicked off by aggressive business practices, which left many consumers even less trusting of institutions than before. Those with jobs are working harder, often for less pay. Millions in the middle-class and working class alike have put retirements on hold as they live in homes that have not recovered their value, or work at jobs below their skills or that ask too many hours—if they have jobs at all. Lending standards of banks and other creditors are tougher. Governments are searching for ways to raise revenue and cut services. People in all walks of life are more worried, and many feel that no one has been held accountable for what they have lost.

The consequence is a hair-trigger reaction, often magnified by media institutions that have lowered their standards, cut staffs, and compete aggressively to attract an audience with news that is often more entertainment than information. What starts out as a whisper can become a roar in a matter of hours, even minutes.

Some brands face risk on the upside, needing the capacity to ride a wave of fast, unexpected growth. Some confront it on the downside, with a product failure or an incident that shows their organization failing to live up to its highest values. Brands sometimes become symbolic of larger concerns in society that the brands may or may not be able to influence.

It’s all a bit fickle. A well-made, top-selling product can be shunned by millions overnight as a result of issues inside a supplier or problems in a sales channel. In this environment, a purely brand-centric approach is financially inefficient and risky. Companies need to draw a bigger circle and include what has previously been outside the risk management evaluation of the brand. Make the evaluation and management of brand and reputation one integrated process, aligned with the organization’s goals. Monitor issues and public attitudes constantly. Create an internal brand and reputation council to evaluate the visibility and credibility of the company and its brands. Respond quickly and effectively if the values of the organization behind the brand are questioned. Over all, invest in reputation building just as you do in brand building.

Reality has changed, and as one colleague likes to say, “There’s no sense crying over spilled brand equity,” because it can’t be put back into the recycled glass bottle.


About the author

Peter Verrengia

Peter Verrengia is president and senior partner of Communications Consulting Worldwide (CCW), a global reputation and communications strategy consulting business within FleishmanHillard. Based in New York, he is a senior member of FleishmanHillard’s leadership team and is co-leader of the firm’s global COVID-19 taskforce and leads its Recovery and Resurgence practice. He works alongside FleishmanHillard’s practice, geography and client leaders to advise organizations and institutions on values-driven actions and communications in response to the pandemic, in balance with strategy for longer-term vision, purpose, plans and initiatives.

He serves clients as a communications advisor, crisis response and recovery manager, messaging strategist and writer. He applies those skills to help leaders navigate reputation volatility in an increasingly complex operating environment.

A FleishmanHillard employee.