Pinpointing the value of a good reputation

Prior to the BurrellesLuce-hosted panel, Catherine Blades, SVP of corporate communications at Aflac, delivered a keynote in which she detailed how the iconic insurance company's comms team has cemented its value to the C-suite by using data and analytics to tangibly prove reputation's bottom-line impact.

Pinpointing the value of a good reputation

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"I only joined Aflac in 2014," Blades told the audience gathered for the live panel. "As the new kid on the block, I am really cognizant of hitting it out of the park when measuring what our function does."

She quickly offered examples. First, tier-one media impressions – The Wall Street Journal, The New York Times, and the like. Aflac’s goal in 2015 was a 20% year-over-year uptick in positive sentiment. They hit 40%. 

Next, employee communications. Her team created a Leader’s Notes app to provide company information and meeting content for management-level staff. The goal was 20% adoption. They hit 50%.

As Blades noted, that is just the tip of the iceberg. Data can go a lot deeper to explain customer sentiment, factors that influence buying decisions, return on reputation, and the like.

"We partner with the Reputation Institute using their RepTrak Methodology," she said, emphasizing that while a strong model, any brand can create its own model based on similar philosophies. "These dimensions are the rational explanation of emotional connections. It tracks perceptions about your company’s ability to deliver on seven key dimensions and 23 deep-dive attributes of reputation." 

At the heart of the model is a Pulse score, which indicates the emotional sentiment stakeholders have for an entity – whether a brand or an industry sector. That score is comprised of the seven key dimensions, which all include three or four specific attributes of reputation:

•Performance (3): Meets or exceeds financials; profitable; strong growth prospects

•Products/services (4): High quality; value for money; meets customer needs; stands behind its products/services

•Innovation (3): Innovative; first to market; adapts quickly

•Workplace (3): Rewards employees fairly; employee well-being; equal opportunities

•Governance (3): Open and transparent; behaves ethically; fair in a way it does business

•Citizenship (3): Supports good causes; positive societal influence; environmentally responsible

•Leadership (4): Appealing leader; excellent managers; well organized; clear vision 

"This data can be reviewed to not only identify trends," noted Blades, "but also hone in on the most important dimensions and attributes that will influence behaviors that mean most to your business."

So what drives reputation in the insurance industry? According to RepTrak’s 2015 data (October-December average):

•Performance: 13.2%

•Products/services: 16.2%

•Innovation: 13.9%

•Workplace: 11.9%

•Governance: 16.4%

•Citizenship: 14%

•Leadership: 14.4% 

Why are these numbers important? "It weights the value of each attribute in the model and can guide you on your subsequent actions," said Blades. "Let’s take innovation. We launched SmartClaim, a system where we can process a claim and direct-deposit into anyone’s bank account overnight. It was revolutionary for the industry. And our reputation got a bump from it. However, the numbers will tell you that innovation is only 13.9% of the model in the insurance industry. Conversely, citizenship, governance, and workplace – all CSR attributes, really – get to well more than 40%. That tells you communications efforts focused on those three dimensions will get the most lift." 

So what can a communications team do with this intelligence? Aflac has produced an Aflac Workforces Report for the past five years. It looks at trends and attitudes around benefits. Executives always viewed it as a key thought-leadership piece. However, in terms of media impressions, the numbers went down year-on-year in 2015. 

So last year, Blades’ team conducted a CSR survey with various key target audiences. The brand earned more editorial coverage in three months after releasing those results than it did in the first three years of the report. "We’re giving people what we know they want that impacts them in a way they care about," explained Blades.

This model works equally well in informing brands when to pare down communications activity. To highlight this, Blades offered an example from Amazon. 

"Look back at the workplace dimension," she advised the audience. "Only 11.9% on our model. Remember what happened when The New York Times wrote an article about Amazon being a tough place to work? Amazon responded with one letter to the editor from Jeff Bezos. That was it. And the "crisis" subsided. Why? Because if you look at how their model is weighted, their customers care about innovation the most. You need to focus outreach on what will give them the most lift and not on dimensions that won’t. That is a philosophy any brand can and should follow."

Blades went on to highlight more numbers that have been validated in the 26 years of the RepTrak model. For every five-point RepTrak score improvement, recommendations for that brand go up 6.5%. Similarly, the propensity to buy goes up more than 5% for each five-point improvement. Those are significant numbers the C-suite will appreciate and understand. It’s an effective way to get a direct correlation between a sales number and the communications activity prompted by data.

Of course, CEOs and CFOs always respond well to proven financial impact. Blades underscored the strong link between reputation and stock price.

Among the 10 most highly reputed companies, the RepTrak Portfolio had outperformed the S&P 500 Index since 2006 – and by an increasingly wide margin since the 2008 financial crisis. Specifically, an investment of $100 in the RepTrak Portfolio would be worth $250 in 2013, whereas an investment in the S&P 500 would be worth about $140.

Clear numbers that indicate a bottom-line factor impacted by data-fueled strategic communications activity.

And what about making a connection between reputation and consumer activity? Blades provided supporting data. Brands with poor reputations, a Pulse score of 0-39, only 8% would buy its products. Those with average scores, 60-69, 32% would buy its products. Those with excellent scores, 80 and above, 85% would buy its products. And those numbers tend to be similar when the activity measured is recommending a brand, trusting it to do the right thing, considering working at that brand, or considering investing in it.

"When I speak to my CEO and give him this data, coupled with specific numbers associated with every five-point RepTrak score bump, he totally gets it," she noted. "In fact, he’s always asking me about the Pulse score."

Blades reemphasized the fact that any brand can build a similar system on their own. They can conduct surveys, of course. There is so much source data to be found on the Internet that can be adapted to individual brand needs. And as a communicator, you must always ask yourself how to build a strategy based on data where you will get the most lift.

"Of course, if you can’t execute on the data, none of this works," she emphasized. "And you must constantly collect new data. We do it monthly and then I look at it all quarterly to see what messages are sticking, what messages are moving the needle." 

To offer one final proof point that all this data and communications activity around brand matters, Blades cited a recent announcement by Brand Finance, an independent intangible asset-valuation company. It reported that Aflac’s year-over-year brand value went up 29%.

"That’s how much your brand is worth in dollars," she said. "And we didn’t have a CMO for a year, so our communications efforts clearly played a huge role."

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