It wasn’t a hacker or a disgruntled customer who ruined the My Pillow bedding company’s reputation; he was its own CEO. On January 6, Mike Lindell – a fervent supporter of Donald Trump – used his Twitter account to support the capture of the Capitol in the United States. It was the straw that broke the camel’s back.
The businessman was already promoting the conspiratorial idea that there was fraud in the presidential elections on his social networks. Those statements made him gain notoriety and criticism. But on the day of the riots, the people – and Twitter – decided to put a stop to it.
The social network banished Lindell. His personal account and that of his company, which he used to evade his ban from the platform, are permanently deactivated. Users, in addition to calling for a boycott of My Pillow, signed a Change.org petition asking some retail chains to remove their products from their inventories. Bed Bath & Beyond, Kohl’s, HEB and Wayfair were some of those that did cut off the relationship.
The mismanagement of social networks is a threat to the reputation of companies. Not taking them seriously will have a direct impact on consumer confidence, culture and company finances, as it is 70% of people’s preferred channel for information.
For Mariana Sanz, CEO of Edelman Mexico, there are two attributes that companies have that have earned the trust of consumers: competence and ethics. “The first has to do with how demanding you are to do your job well and keep your promises. The second is about doing the right thing and working to improve society, “he says.
Replicating a conspiracy theory doesn’t exactly meet the second. Sanz highlights the role of the leader of My Pillow as a serious mistake. According to the ‘Edelman Trust Barometer 2021’, a study that measures trust levels in institutions, 56% of respondents believe that business leaders are misleading consumers by replicating information they know to be false.
For this reason, “it is key that a leader is transparent, genuine and that he shares truthful data, that gives peace of mind. Otherwise, the consequences are devastating. And, contrary to what we think, they arrive very quickly. People block and boycott ”, assures the specialist in reputation.
In this sense, it is not surprising that 58% of the value of a company is attributed to the reputation of the CEO, according to ‘The State of Corporate Reputation in 2020’, by the consulting firm Weber Shandwick.
The life preserver of the crisis
The value of corporate reputation is not new, but it has not always been a priority. “A pandemic had to come for companies to reinforce what, for years, they were disclosing, but few took into account: putting the consumer at the center of the strategy,” says Jonathan Torres, director of the consulting firm BeGood, atelier de reputation and storydoing.
Today, the reputation and value of a brand is what matters most. And not only because of the impact they generate on society, but because it is directly reflected in business results. According to Weber Shandwick, it accounts for 63% of the company’s financial value.
Torres assures that this percentage rose to 80% after the pandemic, because at a time of uncertainty and concern, the brands became a beacon of light. In addition, maintaining a good reputation can increase profits by up to 30%.
“The blow that generated the pandemic has caused severe pain in society, financial difficulties, precarious health and the dismantling of an economic model that does not work. Reputation takes an important level, since an entity was needed to help resolve these circumstances and the companies did it ”, he says.
There will be time to earn money, says Pilar Torres, director of Crisis and Risk at LLYC Mexico. Today is the time to worry about stakeholders. People are demanding that companies take a more active role, that they are not just economic agents. But it is not just about being empathetic and supportive, they have to communicate. 92% of consumers wanted to listen to brands during the contingency, according to Kantar, not with commercial announcements, but with information that would help them cope with the confinement (78%) and to know the actions they were taking (75%) .
A study by Zimat Consultores and The RepTrac Company to understand the impact of the pandemic on reputation reveals that, from a list of 16 brands chosen at random – Aeroméxico, Amazon, Banco Azteca, Bimbo, Coca-Cola, Grupo Modelo and Walmart, among them – 40% of consumers were aware of their support initiatives. Even 60% would buy and recommend their products. But there are 60% of users who do not know them. Of them, only 33% would recommend them.
“Companies have to verify that they are capable of innovating and generating a model that meets the needs of their market. Those who do not care about the environment, who do not contribute anything positive and continue with their bad practices, are going to get lost along the way ”, says Jonathan Torres.
It seems that brands have understood – or are on the way to do so – that a post on social networks is not enough, and that it is not a fashion that you have to get on to gain followers, but rather to be part of a movement to stay in the market.
