What is Reputation?
Reputation is one of the significant factors that determine the success of a business or an individual. A good reputation offers several growth opportunities, boosts sales, and increases the rate of customer retention.
Building and maintaining your business reputation is crucial if you want to see your business flourish over the years. Many things can help you improve your business reputation, for instance, good customer service, customer loyalty, etc.
This article provides a complete reputation definition. It also answers frequently asked questions like what reputation is, why is positive business reputation important, and how you can improve your online reputation with a good online reputation management strategy.
There are many reputation definitions you can find on the internet. Below is the comprehensive reputation definition that will help you understand this concept better.
Reputation is the opinion of people, including customers, employees, stakeholders, and people, about a person or a business owner. Reputation is established based on different factors, including performance and behavior.
You cannot define reputation on a quantitative scale because it is abstract. You can only describe it in words like excellent, good, poor, bad, etc. Nowadays, internet users use social media platforms, search engines, and word-of-mouth to find the reputation of a brand or a person they do not know.
Now that you know the definition of reputation let's read what reputation is in business.
What is reputation in business?
Business reputation is what people feel and believe about your business, particularly your services or products.
They can develop their opinions based on their experience, customers' reviews, and facts they gather from the internet or other people. People usually only think twice before deciding on a business. They need to verify whether the reviews or information they use to create opinions are true.
The internet has made it easier for people to identify a company's reputation. Many people now check customer reviews, listing and directory presence, social media presence, and surveys to get an idea of a business's reputation.
Your business's reputation is in your hands. Your performance, products, services, emotional appeal, and many similar things will collectively create your reputation and show your business's reputation.
What is the reputational risk?
Reputation risk is the danger to the name of a company due to a series of events. It impacts revenue and has other adverse effects. It can occur directly (as a result of the actions of the company), indirectly (as a result of the actions of an employee), or tangentially (as a result of the actions of the peripheral parties).
It can occur without warning and can change everything in a short time. Your customers or strangers can develop an unfavorable narrative about your business, reducing your net revenue.
Therefore, you should always work for reputational risk management to prevent bad incidents from happening. Try to find your company's reputation and work on improving it with time.
Types of reputational risk
Three types of reputational risk will help you better understand reputation and risk.
The origin of a management risk is the bad decision-making of the company. They need to manage a rising issue that can become a serious threat and a major cause of reputational damage.
Cultural risks can occur due to the policies and practices of a company, which can be either ethical or legal. Common examples of cultural risk are the unfair removal of staff, the replacement of a longtime CEO, etc.
External risk occurs due to an external factor, for example, a natural disaster, scandal of suppliers, or joint venture partners.
What is reputational recovery?
As the name indicates, reputational damage is recovering after your company's reputation has been tarnished. It is about something other than removing negativity from the search results. You must put in extra effort and regain your customer's trust by replacing negative content with positive content that can change the customer narrative.
Reputational recovery is performed by using effective strategies and plans. You have to calculate the reputational damage, set achievable goals, design a practical recovery plan, and then put all your effort into executing the plan correctly.
What is the importance of reputation in business?
After learning what reputation is, reputation risk, and reputation recovery, let's find out the value of reputation in the business.
Reputation is important because people trust you. They know what you stand for. They know what you believe in. They know how you act. They know what you're capable of doing. And they know whether or not they want to do business with you.
That's why it matters.
But there's another reason. There are several reasons. Let's take a look at them.
Effect of online reputation on offline perception
We are living in a digital era. Rumors do not take more than a minute to spread on the internet like wildfire. You may believe that your online reputation will not affect your offline reputation, but this is different from how things work now. The online reputation of a business has a direct and almost equal impact on its offline perception.
Statistics show that around 50% of consumers can doubt the credibility of a business after reading its negative reviews on the internet. Therefore, you should always look for ways of improving your reputation and keeping your business out of risk.
More customers and sales
It does not take long for a well-reputed company to gain the trust of its customers and potential customers and convert them into loyal customers. Your satisfied customers will share their positive reviews with their relatives and friends, which may make them your customers.
Contrarily, a bad reputation can damage your credibility and reduce sales significantly.
A good relationship with customers
A good business reputation is essential for business success. It can change the point of view of your customers about your business and increase customer retention, loyalty, and net revenue while promoting positive word of mouth.
In addition to reputation, you can use other ways of building strong customer relationships. These ways include providing multiple communication channels, having an active customer support team, appreciating loyal customers, and personalizing customer relationships.
Increase the company's value
Reputation increases a company's value, which helps in attracting new customers and increasing cash flow and profitability. Your company gets more chances to grow and launch new products. It would help you find out your company's reputation so that you can improve it.
Better business opportunities
A well-reputed brand attracts not only customers but also sponsors and worthy investors—many doors of opportunities open for it. You can only continue if you learn about your company's reputation and devise the best plan for improving and maintaining it.
Chance to attract more qualified employees
Your business that respects and cares for its employees and provides them with growth opportunities attracts more qualified and experienced employees. If your current employees are happy with the work environment and everything else, many more will wish to join your corporation.
More customers, increased sales, more products or services, everything will combine and increase your net revenue. More revenue will further allow you to expand your business in many areas.
If your business provides premium products and services to its customers, happy clients will not stop talking about it with their friends and family. Positive word of mouth will be free advertising for your business and increase brand awareness.
How to maintain a good online reputation in business?
You need to maintain a good business reputation to make your business flourish and protect it from reputational risks. Below are the practical tips to improve and maintain your online business reputation.
Check your business reputation from time to time.
The first thing you need to do is check your company's current reputation in the industry. Google is a great source of information. Take advantage of this free search engine and search for your business name in the search bar. Evaluate all the relevant pages that appear on the first page. Check different review websites. Go to the images and open relevant ones to see what people say about your brand.
Build your online presence
To improve and maintain your online reputation, you should utilize social media's power to capture consumers' attention. Build active social media profiles on different platforms. It will help you increase leads, maintain transparency, and quickly respond to customer queries.
Design a great reputation maintenance strategy
You should plan a proper reputation maintenance strategy and implement it. Do not give anything a chance to damage your hard-earned reputation. Keep an eye on your competitors and industry giants. Learn from them, and do not hesitate to ask for expert help when you need it.
Respond to comments
Encourage your customers and followers to comment on your posts and keep your profiles interactive. Respond to negative comments so that customers do not feel neglected.
Comments show that you have several users who like using your services and products. It would be best to run interactive campaigns and giveaways to attract people to your posts.
Pay attention to LinkedIn.
LinkedIn is a professional social media platform that you can use to connect with professionals and a vast community. Unlike Facebook, Instagram, etc., you can attract influencers from your niche. LinkedIn is a professional platform, meaning your content should also look professional. Depending on your business type, you may need to hire a specialist to handle your LinkedIn profile.
Acknowledge your mistakes
We know bad reviews can feel painful, but you should not ignore them. Instead, consider them an opportunity to amend your mistake. If you respond to a negative review the right way, you may be able to change the view of the customer, and he may get ready to give your products another chance.
Resolve the issue and offer your customer the best possible solution. It will help you not only protect your reputation but also to improve it.
Be honest to gain trust.
Building trust is the key to building a reputation. You should be honest with your customers and stay true to your words to encourage your potential customers to have trust in your business.
Ask for reviews
There is nothing wrong with asking for online reviews politely. Of course, you should not beg for them. But tell your clients that their reviews provide insight into what they think about your services and products, and you find what needs improvement. Reviews can also encourage your team to work harder and improve productivity to provide better customer service.
Keep your customers engaged.
Building your social network presence is the first step towards increasing leads and improving your reputation. But a dead profile where you publish a post once a month will only do a little for your reputation.
You must publish impressive posts regularly to make your business profile engaging and interactive. Respond to messages, comments, reviews, and queries to show interest in your customer's opinions and thoughts.
Provide good customer service
Providing prompt replies to your customers' queries and resolving their issues is a great way of improving your reputation and gaining their trust. You should use the best ways of making their experience using your services easy and enjoyable.
Keep working towards improvement.
If you already have a good reputation, you should still keep working on improving it. Markets change over time. Customer's needs also keep changing. New people join the market and try to compete with the existing businesses. Changing your marketing strategies with time is crucial to stay ahead in your industry and maintaining your reputation.
What is reputation – Summary
Your business reputation holds a lot of power. It can either make or ruin its growth opportunities. It would be best if you created an effective and practical reputation-building strategy and worked hard to get the desired results. First, determine your business's reputation, then set a plan to improve it according to its needs.
A good reputation will convert your regular customers into loyal clients. It will also help you improve your relationship with other customers, boost your sales, and increase your company's value and revenue.
November 18, 2022