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Thursday
Jan152009

Russia: Reputation in terms of science - What helps and impedes brand management

Photo taken by SIS International. Copyright (C) 2009. All rights reserved.Dmitry Shimanov, General Director of MAR Consult Research Agency

Companies, which build their reputation "by intuition" and perceive it as a by-product of advertising efforts, not only miss all the opportunities provided by a well-established image, but sometimes jeopardize their brand.

It is no secret that under current market conditions reputation is one of a company's key competitive advantages. Companies should make effort to build their reputation, otherwise, it will be formed naturally, and it is not clear, what results public perception of such an uncontrolled image may bring.

If a company succeeds to create a positive image, it alone will deliver numerous commercial benefits. For instance, a well-reputed company may eventually cut its ad budget and special events and only place image-supporting ads. A brand with a positive reputation will produce considerable profit, not to mention its increasing value. This brand may be regarded as viable (i.e. able to minimize external risks). Apart from that, it allows the company to actively develop on the market, because perception of all new products is influenced by the existing brand leader.

Reputation is viewed as public opinion toward a company, determined by the company's image and influencing its performance. Reputation management should be part of the general marketing strategy -- this is how complex approach to company development may be ensured. Primary purpose of reputation is establishing long-term cooperation with the public, including clients, partners, suppliers, distributors, state bodies and other relevant audiences. Each of the listed segments requires separate information flows, which will create a positive perception of the company within the segment.

Theory is good, but what about practice? Reputation management is still one of the weak points of Russian companies.

In my opinion, the first mistake that marketing specialists make is using... advertising events to create reputation -- probably for the sake of saving budget. In other words, they try to combine several processes at the same time: product promotion, sales promotion and image creation. As a matter of fact, in order to handle this set of tasks it is necessary to use integrated marketing communications, including PR, which will provide unobtrusive information on the company's operations, draw attention, improve unfavorable impression, etc.

Another mistake is that we often tend to create reputation "by intuition", based on our opinion toward what it should be like. Instead, we should aim at consumer attitudes and study them through marketing research, wherever needed.

However, a company's image does not appear in people's minds by itself -- it is predetermined by certain associations, connecting people's perception of the brand with their ideas about this or that lifestyle or consumption situations. A well-established reputation ensures firm and consistent associations.

In order to focus on image characteristics, appreciated by the target audience, and effectively influence consumer opinion, the company should gather a wide range of auxiliary information on its environment, market position and target audience behavior. In what way would this marketing information improve reputation?

A simple example. If we create an image on the basis of the connection between a brand and certain type of consumption, consumers will have a strong association relating them with the company's target group. Thus, a seller of luxury goods may present its brand as a way to become part of a certain social class. In this case the brand should be associated with the elite (at the same time it will sort out consumer segments not included in this class).

Indeed, there is a large variety of typologies, through which a company should be positioned. Their number is the same as the quantity of features for target audience segmentation, from gender distinctions (for instance, women's cell phones or men's chocolate) to level of income. In order to select most discriminative and illustrative segmentation features, we might make use of target audience research, covering characteristics of consumers through which they identify themselves as part of their social group. It is vital that the newly-created identity should correspond to functional and psychological benefits, promised by the brand.

Many companies create associations with definite types of people through certain characters, whose faces deliver communicative messages. These characters should possess definite features, reflecting traits of people that are important for the target audience. For instance, the face of Omega watch brand is Anna Kurnikova, Motivi clothes -- Natalia Ionova (Glukoza), whereas Comet cleaning products are presented by Inna Ulyanova. It is impossible to change their places. Selection of a character promoting a brand should be based on a strong similarity between consumers' expectations and the character's attributes. This is why successful choice of a character also depends on marketing information -- in this case, information on popularity among the target audience.

If positioning is based on human values (such as aspiration for self-improvement, search for self-respect, orientation at entertainment, and so on), the choice of a trend also largely depends on the relevance of this or that attribute to the target audience. In this case the company would require marketing research covering consumers' values and expectations of life.

It should be noted that values may gradually change, because they are influenced by social trends. This is why we often face situations when various values have different significance for people of different generations. For instance, the luxury image related with Cadillac is appreciated by the older generation of Americans, but is less interesting to younger (but wealthy) consumers, who would rather prefer BMW. If the choice is correct, the value will arouse the needed associations, so it is vital for the company to keep an eye on the images, connected with their brands, as well as on possible changes in the attractiveness of these brands.

Thus, a good reputation allows to increase brand capitalization, which, in its turn, will improve the company's competitiveness and draw the best specialists of the given field. Needless to say, these results may be achieved in the long term. The company should constantly analyze information and be ahead of competitors in terms of favorable interpretation of events. Besides, it is recommended that several communication channels should be used to interact with the public. Then, everything that has any connection with the company and its products or services will build its reputation and ensure constant support by word, image, or deed. As a result, all this information will become a single image in people's minds.

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Contributing Company:
MAR Consult Research Agency. Moscow, Russia.
Contact: Dmitry Shimanov. info@marconsult.ru +7 (495) 660-82-20.

Disclaimer: Views & opinions are solely those of the contributors and do not necessarily reflect SIS International Inc.'s opinions, views and methodologies. Under no circumstances will SIS, it affiliates, successors or assigns be liable for any loss or damage caused by anyone's reliance on information contained in this web site. SIS International Market Research

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