Handbook of Corporate Communication and Public ... - Blogs Unpad

that customers, employees, and the CEO (in
that order) are all most highly ranked in terms
of maintaining corporate reputation. By nigh
on unanimous vote, customers are by far
the most important influence on corporate reputation
(see Kitchen and Schultz, 2001a).
However, this point is not unremarkable in
that it has been hammered home in innumerable
text books and articles derived from the
marketing discipline. Customers are important
for at least five marketing reasons as listed by
Schultz and Walters (1997), but note however,
that each of these terms also has resonance for
corporate communication and reputation.
1 Buying rate: a base measure of loyalty
which allows the firm share of market,
mind and heart.
2 Customer retention, in total and by class: the
percentage of customers retained in a specific
accounting period.
3 Customer advocacy: increases in customer
referrals as a percentage of total customers
is also a key indicator of loyalty.
4 Price elasticity: where customers are willing
to accept price increases with little
or no effect on their behaviour, strong
loyalty is presupposed.
5 Customer-switching costs and barriers to
competitive entry: where a brand creates
customer-switching costs, loyalty is more
likely to be achieved. The greater the
switching costs the more difficult it is for
competitors to ‘pull’ customers away from
the brand.
The Schultz and Walters range of criteria,
however, is supported by a range of measures
from the corporate communication literature.
For many firms, the brand is not just the product(s)
customers learn about, consider, value,
purchase, consume, and are loyal to.
Customers increasingly want to know about
the corporate entity that ostensibly owns the
brands in terms of:
• What does the parent company do
• What doesn’t it do
• What values does it personify
• Which personalities are running the company
• How do they treat employees globally
• Are they ‘good’ corporative citizens
The issue of how employees are treated can
become important media news all round
the world. As Nike has found to its cost, it is
one thing to subcontract work to factories in
Southeast Asia, and quite another to square
sweatshop wages with premium prices in
western markets. Bennis (1997) makes the
claim that for corporate vision to be meaningful
it has to be shared at all organizational
levels. Sharing a vision implies a sense of
belonging, support given to corporate goals
and positive behaviour and word of mouth.
Fombrun (1996) indicated that corporations
that employees would like to work for promote
trust, empower people and inspire
pride. It is remarkable how few organizations
are able to achieve these seemingly simple
objectives.
In a wider international context, corporate
reputation plays an important role in terms of
generating sales in new overseas markets. But,
Dunning (1993) considers that reputation
extends well beyond sales performance. From
a multinational enterprise context he asks:
• Is its impact on economic welfare a good
thing
• If it is (already) good, how can it be made
even better (brackets added)
• Do we wish our country to be tied to
an international division of labour fashioned
or influenced by foreign MNE
activity
© 2004 Sandra Oliver for editorial matter and selection;
individual chapters, the contributors