Companies Downplay Online Reputation Risk

The Conference Board's new report, Managing Reputation Risk and Reward (press release, via Leslie Gaines-Ross), reveals that intensive social media monitoring and engagement are still early-adopter activities. In order for these practices to move into the mainstream, business leaders must first be convinced of the relevance of social media to company reputation. Then comes the opportunity to apply metrics and modern tools to the perceived challenge of monitoring media activity.

Social media for early-adopter businesses
Almost two years after Business Week published Web Attack, the fear motivation hasn't made the rounds (greed is less prominent in a study on reputation). While 82% of respondents in the new report say their companies make substantial efforts to manage reputation risk, most don't think social media have a large impact on reputation.

As much as everyone inside the social media bubble is tired of hearing the same old stories, a significant population hasn't learned the lesson yet, and so shouldn't be a surprise that they're not doing much to manage their reputations online. Only a third of the companies in the survey have extensive social media monitoring programs in place, and 75% report little or no active participation in social media.

Monitoring media, but wanting more
Beyond the relevance of social media, many companies are stuck with dissatisfying, simplistic media monitoring models (replaying a hundred Katie Paine comments in my head as I write this). While most companies in the survey monitor traditional media, they were less likely to use automated systems in the effort, and simple metrics predominate.

Ironically, almost half listed "monitoring media coverage" as a very significant challenge.

The boss agrees, reputation is critical
CEOs agree on the importance of corporate reputation, though most think they don't have enough information about it. In the PriceWaterhouseCoopers 12th Annual Global CEO Study (via Jennifer Rice), 63% of CEOs surveyed rated strength of the company's brand and reputation as a critical source of long-term competitive advantage, while only 31% think they have the information they need about them. A similar gap exists between CEOs' knowledge and the importance of customer preferences and needs in the market.

Applied listening strategies
I see three related challenges here: lack of understanding of the impact of online activity, inadequate media analysis practices, and a need for new sources of market insight. Especially as social and traditional media become indistinguishable, I see these as closely linked. Listening strategies will help with each.

  • Understand the reputation risk potential in social media.
    Review the oft-told tales of reputation crises that started or developed online. Notice how many online crises ended up in traditional media news coverage. Perform an initial audit to discover the company's current online reputation and its impact on company reputation in general.

  • Upgrade monitoring of traditional media to measurement of all media types.
    The media monitoring and measurement market is evolving rapidly. If your current methods don't deliver useful and timely information, look at new options. Pay attention to the types of media sources they track to ensure that you find current developments that affect your company.

  • Evaluate online sources for customer/market insight.
    Social media blur the boundary between media and social activity; evaluation of social media provides insight for both sides of the disappearing line. Measure online content for what your customers are saying to each other online, not just for general sentiment but for discovery of important topics.
Inside the social media crowd, some of the buzzwords are in danger of wearing out. This new report from the Conference Board tells me we're going to be teaching the basics for a long while.

Thanks to Frank Tortorici at the Conference Board for sharing the report with me.

About Nathan Gilliatt

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  • Voracious learner and explorer. Analyst tracking technologies and markets in intelligence, analytics and social media. Advisor to buyers, sellers and investors. Writing my next book.
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