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Earned Trust:
MSLGROUPs Reputation
Impact Indicator Study
[China Edition]
The MSLGROUP
Reputation Impact Indicator
A major global survey and report that
combines both intuitive and rational
dimensions when studying the
reputation of leading multinationals.
Foreword
The reputation of a corporation is its license to
operate. It has a decisive impact on the success
of the organization and is generally regarded as
one of its most important assets. And yet, we
would argue, there is clearly a need for a much
deeper understanding of the multifaceted
elements that contribute to corporate reputation
than currently exists today.
Anders Kempe
EMEA President for MSLGROUP
The MSLGROUP
Reputation Impact Indicator
A major global survey and report that
combines both intuitive and rational
dimensions when studying the
reputation of leading multinationals.
Foreword
Kindly,
Anders Kempe
Introduction
Globalization has eliminated many boundaries
to create a more interconnected world. It has
also played a part in enabling companies to
become global brands and conduits of these
connections.
We live in an era where McDonalds, Coca-cola, and Starbucks could be
found just about anywhere in the world, and the companies work very
hard to make sure the same product and quality of service can be found
regardless of location.
Daisy Zhu
Managing Director
for MSLGROUP China
Introduction
Overall this study validates some ideas about corporate reputations and
provides a fresh perspective on Chinese views about companies and
brands. More importantly, it provides us with a more plausible metric for
communicators to achieve business goals. This fullls our
Business-Driven Communications positioning. Communications may be
an art but the Reputation Impact Indicator and Mind Space provides the
science. Through our study we can advise communications practitioners
and stewards of corporate reputations on the why and how they can
preserve or enhance their reputations in dynamic China, foster enduring
relationships with stakeholders and contribute to the betterment of
Chinese society.
I hope you enjoy this report and it stimulates new thinking and actions for
you!
Kindly,
Daisy Zhu
Executive Summary
1.
The eld research was conducted during the last
quarter of 2014, by means of a survey on a
statistically validated sample of the general public in
10 countries, totaling 26,467 qualied respondents.
The survey was complemented with analysis of
social media content for 10 selected companies.
Executive Summary
Reputation drivers linked to actual consumer experience have greater
signicance than corporate reputation when evaluating Net Promoter
Score (NPS). Unsurprisingly, there is a clear correlation between
corporate reputation and NPS, and the most important driver for both is
how well a company is perceived to deliver its products and services.
A strong Mind Space can engender a robust corporate reputation.
There is a correlation between how easy it is for respondents to mentally
associate with a specic company or brand its relatability - and
reputation. High brand awareness alone is not enough. The ideas,
images, feelings one associates with a given company need to be easy
and quick to draw upon, positive in sentiment, and linked to that
companys products and services. Companies that have this clearly
dened Mind Space will enjoy a more robust corporate reputation, while
companies that do not easily invoke such mental associations, or invoke
neutral rather than positive associations, will have a weaker reputation.
There are also dierences for which factors have the largest impact on
reputation between respondents with positive, neutral and negative
associations. For the former, the perception of products and services is
most important, but for the latter group aspects of corporate behavior play
a more signicant role.
Important discoveries from the research:
An optimistic new world versus a skeptical old world. Contrary to
traditional thinking, China, along with new world peers Brazil, India
and South Africa, has a more positive perception of companies than
counterparts in North America, and particularly Europe, where
respondents can be said to demonstrate greater skepticism towards
companies in general.
Brands are global, corporate reputation is local. There are large
variances in the reputation of individual companies at a country level.
Even though a brand is recognized globally, the reputation of the
company is local.
Social media content reects the relative importance of the
reputation dimensions. A large majority of discussions online are
about topics related to company products and services, and this is also
the area with most un-aided engagement. A majority of negative posts
online are related to corporate behavior, conrming the negative impact
of this dimension.
The Study
and yet, we would argue, there
is clearly a need for a much
deeper understanding of the
multifaceted elements that
contribute to corporate reputation
than currently exists today.
Anders Kempe
President, EMEA, MSLGROUP
The Study
The Study
A New Reputation
Framework Combining
Rational Response with
Intuitive Associations:
The MSLGROUP
Reputation Impact
Indicator
Robert Gelmanovski
10
countries
26,467
interviews
The Study
10
The Study
MSLGROUPs Reputation
Impact Indicator model
Examining the relationship between the Reputation
Core, the underlying reputation drivers and the
content produced by and about companies.
Reputation
Content
Reputation
Drivers
Reputation
Core
11
The Study
Corporate reputation:
The general collective judgment of a corporation based on
assessments of the impact of performances and actions attributed
to the corporation over time.
NPS, Net Promoter Score:
The inclination to recommend a company.
Brand awareness:
The extent to which a brand is recognized by potential customers,
and is correctly associated with a particular product or service.
Mind Space:
The ease with which a respondent can answer questions about
the company. Measures the strength of brand awareness.
Reputation Core Index:
The measure of corporate reputation used in the study.
A combined score that answers the questions Do you like
company x?, Do you trust company x?, and Do you respect
company x?
Products and services:
The term used for a group of reputation drivers reecting the
quality of the companys oering.
Corporate behavior:
The term used for a group of reputation drivers reecting a
companys actions and business behavior.
X acts ethically
X is open and transparent about the way the company operates
X has a positive inuence on society
X cares for the environment
X cares for its employees
Relationship:
The term used for a group of reputation drivers reecting the
quality of the companys relationship with its customers.
X involves the customer in the creation of new
products/services
X delivers on its promises
X is open to criticism and suggestions for improvement
X communicates in an honest and sincere way
X oers good customer service
Financial performance:
The term used for a group of reputation drivers reecting a
companys nancial performance.
X is a protable company
X has a capable leadership
12
The Study
A more qualitative
approach to brand
awareness building positive
associations that are easily
accessible in the minds of
stakeholders is therefore a
key to a strong reputation.
And the more closely this
Mind Space is linked to a
companys products and
services, the better.
Positive
Easy
Negative
Neutral
22%
09%
78%
38%
53%
13
The Study
How do we dene
Mind Space?
Brand
85
Positive
associations
Neutral
associations
0
Reputation Core
Company I like
14
Company I trust
Company I respect
The Study
Acts ethically
Consumer
electronics
FMCG
Negative associations
Neutral associations
Positive associations
Pharma
15
Internet
The Study
Protable company
Capable leadership
Consumer
electronics
FMCG
Negative associations
Neutral associations
Positive associations
Pharma
16
Internet
The Study
FINDING
Global
China
Financial
performance
Relationship
Corporate behavior
17
Products
and services
The Study
Global
China
10
11
12
9. Is a protable company
4. Acts ethically
18
13
14
The Study
Respondents in China
clearly see companies
playing a part in caring
for the environment.
Global
China
10
11
12
13
14
15
1.
2.
3.
4.
Acts ethically
5.
Is an innovative company
6.
7.
8.
9.
19
16
17
The Study
Global
China
Has a capable
leadership
Delivers better
nancial results than
its competition
20
Has a
clear vision
for its future
Has good
potential for
future growth
Is a
protable
company
The Study
Global
China
0
Has
good potential for
future growth
Has a
capable
leadership
Has a
clear vision
for its future
Delivers better
nancial results
than its competition
Is a
protable
company
Global
China
0
Has
a capable
leadership
Has good
potential for
future growth
21
Delivers better
nancial results
than its competition
Has a
clear vision
for its future
Is a
protable
company
The Study
Global
China
0
Has a
clear vision
for its future
Delivers
better nancial results
than its competition
Has
good potential
for future growth
22
Has
a capable
leadership
Is a
protable
company
The Study
d. Environmental care is an
important contributor to
corporate behavior
Acts ethically
Open and transparent about
the way the company operates
Positive inuence on society
Cares for its employees
Cares for the environment
Pharma
Consumer electronics
FMCG
23
Internet
The Study
Global
China
0
Acts
ethically
Has a
positive inuence
on society
Cares for
the
environment
Is open and
transparent about
the way the
company operates
Cares for
its
employees
Global
China
0
Has a positive
inuence
on society
Acts
ethically
24
Cares for
its
employees
Is open and
transparent
about the way
the company
operates
Cares
for the
environment
The Study
Global
China
0
Acts
ethically
Has a
positive inuence
on society
Is open and
transparent about
the way the
company operates
Cares for
its
employees
Cares for
the
environment
Global
China
0
Has a
positive inuence
on society
Acts
ethically
25
Cares for
its
employees
Cares for
the
environment
Is open and
transparent
about the
way the
company
operates
The Study
e. Delivering on promises
strengthens relationships and
corporate reputation
When it comes to the relationship
dimension of reputation (reecting the
quality of a companys relationship with
its customers), delivering on its
promises and good customer service are
the main drivers in China. This seems
reasonable as Chinese consumers buy a
product or service from a business,
thereby establishing a relationship,
albeit a transactional one. When
companies fail to provide or deliver,
consumers begin to doubt and lose
trust, which ultimately erodes the
relationship.
Involving customers in
creating new products and
services reects a deeper
level of customer
engagement in China that
strengthens the relationship
dimension.
Pharma
Consumer electronics
FMCG
26
Internet
The Study
Global
China
0
Delivers on
its
promises
Oers
good customer
service
Communicates
in an
honest and
sincere way
Is open to
criticism and
suggestions for
improvement
Involves the
customer in the
creation of
new products/
services
Global
China
0
Delivers on
its
promises
Oers
good customer
service
Is open to
criticism and
suggestions for
improvement
27
Communicates
in an
honest and
sincere way
Involves the
customer in the
creation of
new products/
services
The Study
Global
China
0
Delivers on
its
promises
Oers
good customer
service
Communicates
in an
honest and
sincere way
Involves the
customer in the
creation of
new products/
services
Is open to
criticism and
suggestions for
improvement
Global
China
0
Delivers on
its
promises
Communicates
in an
honest and
sincere way
Oers
good customer
service
28
Involves the
customer in the
creation of
new products/
services
Is open to
criticism and
suggestions for
improvement
The Study
FINDING
Global Brands,
Local Reputation
A global corporate reputation might well
be the sum of local reputations in each
individual market, but how reputation is
constructed in those markets means that
each must be attended to with insight
and care. This is a signicant challenge
not least given the growing importance
(and reach) of web-based
communication.
Respondents in China are more positive
of the reputations of the companies in
the study, where reputation scores
ranged from 84 to 63. A more telling
story are the dierences between
industry clusters: the B2B industry
earned the highest reputation core
scores in China, well above consumer
electronics and retail industries and
compared to being ranked sixth out of
seven in the global study. In China, the
Internet industry ranks sixth in China,
which is far from second place globally.
The dierences might be explained by
mind space: consumer-focused
industries with a higher relatability for
the general public have a higher
reputation score in the study. Another
part could be attributed to the idea of
respect and how its related to
knowledge. The average Chinese
consumer may not be knowledgeable
about B2B companies but it doesnt
preclude them from respecting them,
especially if they are Fortune 500
Companies. Third-party or independent
rankings provide some assurance of
positive corporate reputation but this
also raises the question about what
really generates like, trust and respect.
As far as local dierences within the
global survey ndings are concorned,
two particular areas stand out:
29
The Study
Global
China
69
81
72
80
71
0
B2B
Healthcare
Automotive
79
79
80
69
Banking/
nancial
services
30
75
Consumer
electronics
78
73
Internet
77
71
Consumer
retail
The Study
New world
Reputation Score
Stronger
Weaker
79
India
76
Brazil
75
China
74
South Africa
67
United States
64
Canada
61
United Kingdom
60
Germany
59
France
51
Sweden
Old world
31
The Study
90
81
76
69
67
57
56
56
54
52
42
India
Brazil
China
South Africa
Canada
United
States
United
Kingdom
Germany
France
Sweden
58
57
56
54
52
52
United
States
France
United
Kingdom
Sweden
Canada
90
84
78
77
68
Brazil
China
India
The Study
FINDING
2.
Marsden, P, Alain Samson and Neville Upton (2005),
Advocacy Drives Growth, Brand Strategy
(198), pp.4547.
Reputation dimensions as
drivers of NPS
Financial
performance
Relationship
Corporate behavior
The Study
Financial performance
Relationshiip
Corporate behavior
Products and services
Consumer electronics
Internet
FMCG
34
Pharma
The Study
The importance of
perception of products and
services is supported by
our analysis of online
content from the
10 sample companies.
FINDING
1.
McDonalds
2. BP
3. GoldmanSachs
4. Citibank
5. Shell
6. PayPal
7. Microsoft
8. Johnson & Johnson
9. Samsung
10. Google
10
20
30
40
50
60
70
80
Values in percentage points, from data derived through a qualitative and quantative analysis of a sample of content
for each company in each of the 10 countries.
35
90
100
The Study
FINDING
Demographics and
Media Habits Matter
The development of the Reputation Core
Index among dierent age groups in
China follows a dierent pattern in each
of the four industries. Where Internet
companies are concerned, reputation is
highest in the years immediately after
university and lowers among
middle-aged respondents but rises again
at 51-55 years. The FMCG and
consumer electronics industries follow
each other closely until about 36 years
where they start diverging FMCG
reputation is highest among the 46-50
year olds.
The reputation of pharmaceutical
companies is the most striking the
reputation score peaks among 51-55
year olds but are the lowest in the age
groups before and after. This diers
widely from other industries where
scores generally weaken after 50 years.
This reveals a remarkable picture of
Chinese consumers whose perceptions
about corporate reputation shift widely
in old age. Its reasonable to expect
strong reputation scores for
pharmaceutical companies for older
respondents theres an increasing need
for medicines and other health services
when we age. But the dramatic rise and
Secondary
College, university
Still studying
Prescription drugs
FMCG
Internet
36
Consumer electronics
The Study
Industry Reputation
Core Index by age group* in China
Prescription drugs
FMCG
Internet
Consumer electronics
100
0
1617
1822
2326
2732
3335
3640
4145
4650
5155
5660
* Age 16-17 and 56- were excluded due to the low number of respondents
Industry Reputation
Core Index by age group in Global
Pharma
Consumer electronics
FMCG
Internet
80
0
1617
1822
2326
2732
3335
3640
37
4145
4650
5155
5660
6165
65+
The Study
13
10
11
12
36%
online
Breakdown:
The rest:
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
38
Other 1%
Newspaper ads 10%
Newspaper stories 10%
TV ads 13%
TV news 17%
Radio ads 2%
Radio news 3%
Magazine ads 1%
Friends or family 7%
The Study
Primary
Secondary
College, university
Still studying
80
40
0
Pharma
Consumer electronics
FMCG
Internet
80
40
0
Pharma
Consumer electronics
FMCG
39
Internet
The Observation
The Observations
...A company that is lit up from the
inside and committed to use its
inuence for the betterment of
individuals or society speaks to the
heart of Chinese people, thus
earning unconditional
trust and strengthening "Mind
Space from stakeholders.
Lusha Niu
Director
40
The Observations
In the Age of Earned
Trust, is Your Corporate
Reputation Reputable?
The meaning of reputation diers around the world the meanings arent
always precise but theyre also not incorrect. The MSLGROUP Reputation
Impact Indicator study is our attempt to ll in the gaps and present a
logical, reasonable, and actionable solution to the reputation puzzle. We
now understand three important conclusions from this research:
1) While brands can be global, a companys reputation is very much
shaped at a local level;
Lusha Niu
Director
for MSLGROUP China
41
The Observations
42
The Observations
Mastering the balancing act between the court of law and the court
of public opinion can help build a reputable local operation
We have seen too many examples of companies succeeding in the rule of
law but failing miserably in the court of public opinion in China. As we
operate in the age of earned trust, even courts are sometimes constrained
by public opinion. With the absence of any formal government lobbying
mechanism in China, the only eective channel left for companies to
change public perceptions is by having a direct conversation with the
public and the respected elite.
Make communication strategy part of your China business strategy
Parachuting a US or European-centric communication framework to
China does not increase your companys reputation locally. China no
longer admires other people or other countries for their qualities or traits.
China admires companies that are truly improving the lives of its people,
leaders for inspiring employee excellence, and behaviors that are full of
care and respect.
As communications becomes even more fragmented and digitized by the
second, a sound reputation is no longer a life-long goal. How can we
communicators seize that high reputation moment and maximize it before
the next trend or moment arrives? Money and eort aside, it takes
wisdom and knowledge to transform that what it is today to what it can
be tomorrow.
At MSLGROUP, we believe the journey to help businesses succeed in the
age of earned trust is just beginning: A reputation in China is your
relationship with China.
43
44
About
MSLGROUP
We are Publicis Groupes strategic
communications and engagement
group, advisors in all aspects of
communication strategy: from consumer
PR to nancial communications, from
public aairs to reputation management,
and from crisis communications to
experiential marketing and events.
About
MSLGROUP
China
As a Business-Driven Communications
Consultancy, were focused on
delivering INTEGRATED, creative
programs through data-based
INSIGHTS, and driven by making a real
IMPACT on business through strategic
communications in the digital age.
MSLGROUP China is a full-service
strategic communications and social
engagement consultancy with more than
200 sta in Beijing, Shanghai,
Guangzhou and Chengdu delivering
business results for some of the worlds
most valuable brands. We were named
China Agency of the Year twice within
four years by The Holmes Report.
MSLGROUP also won accolades from
SABRE, the International PR
Association, the China PR Association,
the International Business Awards, and
Chinas New Media Festival.
45
MSLGROUP.CN
Wei Wei
Marketing Head
wei.wei@mslgroup.com