Reputation Strategy and Analytics in a Hyper-Connected World

Chapter Six The Economics of Reputation

Executive Summary: In modern competitive markets, reputation has business value and should be treated as an asset. Measuring reputation should not be a “one shot” exercise, but a consistent process performed diligently at regular intervals. It’s a good practice to establish a baseline from which subsequent measures can be compared. Having a baseline makes it easier to spot trends and emerging patterns that can be used by the organization to improve performance and mitigate risk.

For this chapter, I sought to answer the question I get so often from colleagues and clients asking about the economic value of reputation. And in particular, is there something that we, as communications practitioners, need to be doing differently given the changes in how companies are using social and digital channels to engage with stakeholders.

Most people understand that reputation has economic value. The challenge is determining the type and amount of its value to your organization. Reputation can be a strategic imperative, but as an economic contributor, its value will vary by industry and by company. In some industries, reputation will account for more than in other industries. It is important to understand how reputation affects your industry and your enterprise.

The potential impact of reputation on the economic health of the modern enterprise requires a nontraditional and unconventional approach. Practitioners today must rethink the traditional idea ...