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6 TAKEOUTS TO DRIVE REPUTATION IN CHINA

If you are in the business of making your company more loved in China, you can't miss the China RepTrak® 100 research, the largest study of corporate reputations in China. In Q1 of 2016, Reputation Institute (RI) collected over 26,000 ratings to uncover the strength of the emotional bond between the Chinese general public and companies.

The China RepTrak® rankings measure the general public’s perception of companies based on seven dimensions: products and services, innovation, workplace, governance, citizenship, leadership, and performance.

So just how does the reputational battleground in China differs from rest of the world?

There are 6 key takeouts from this research.

  1. Being Foreign is Not a Disadvantage
  2. Trust is in Decline
  3. Who You are Matters More than What Products You Sell
  4. Leadership Matters
  5. Emotional Bonds are Stronger and Stickier than Rational Drivers

  6. Small Improvements Translate Into Big Gains

This post will examine 3 of these findings.

 

First let's get some context. As you know not all industries fare equally. If we look at reputation from an industry perspective, most industries fare well in China, but financial services and information technology fare significantly lower than the rest.

There are 6 key takeouts from this research.

  1. Being Foreign is Not a Disadvantage
  2. Trust is in Decline
  3. Who You are Matters More than What Products You Sell
  4. Leadership Matters
  5. Emotional Bonds are Stronger and Stickier than Rational Drivers

  6. Small Improvements Translate Into Big Gains

This post will examine 3 of these findings.

1. Being Foreign is Not a Disadvantage

The Chinese general public does not trust local companies. In fact what drives consumer behavior more is that they trust international ones. Did you know that only 1 out of the top 10 (and 11 out of the top 100) most reputable companies in China are Chinese. Foreign companies can and do build strong reputational platforms and recognizable brands in China.

Further insight can be gained from examining which Chinese companies did manage to crack the top 50. The Chinese public seem to respect and admire companies that compete internationally more than those that make their revenues solely from the Chinese market. One could interpret this finding as suggesting that the Chinese public discounts the success of local companies, perhaps attributing it to favoritism and connections with government. In any case, the data seems to suggest that success in international markets translates into a stronger emotional bond in the Chinese market.

2. Who you are matters more than what you sell

Reputation Institute studies both the emotional nature of corporate reputation – captured in its RepTrak® Pulse score – and the rational drivers behind the emotions. To generate a strong emotional bond with stakeholders, a company needs to earn good reputations across all seven dimensions: Governance, Products/Services, Innovation, Workplace, Citizenship, Leadership, and Performance.

The 2016 China RepTrak 100 study reveals that the trend towards more emphasis on Enterprise is evident in China too (similar trend was observed over recent years also in RI's Global and US studies). While the quality of your products/services is an important driver of corporate reputation, its relative weight has been decreasing over time (currently explaining less than 17% of your overall reputation in China). In fact in 2016 in China, the Enterprise drives 60% of your reputation and the product drives 40%. This is consistent with 2015 results also.

The biggest takeaway point is that building an excellent reputation in China necessitates excelling in all dimensions. As the full report shows, each dimension counts for at least 13% of your overall reputation. Companies operating in China therefore need integrated reputational platforms that operate across all areas of reputation and stakeholders.

3. Leadership Matters

Perhaps the biggest difference in the relative importance of each reputation dimension comes from Leadership. In the Reputation Institute's Global and US studies, Leadership, while important, is relatively less important than all other dimensions. In China, by contrast, Leadership is one of the 3 most important dimensions. To illustrate the power of Leadership in determining your overall reputation in China, consider another striking pattern: out of the top 50 scores in Leadership, only 2 companies are Chinese. Perhaps unsurprisingly, those 2 companies are the ones that do most of their business internationally and have “imported” over the years management models and personnel.

To read about all 6 takeouts from the China RepTrak 100, download the detailed report here. Watch the webinar here.

About RepTrak

Reputation Institute’s RepTrak® model is the gold standard for reputation measurement, providing a one-of-a-kind measurement of how the general public views the world’s best-known companies. The RepTrak® database is normative, examining 15 stakeholder groups in more than 25 industries and more than 50 countries for more than 7,000 companies. The 2016 China RepTrak® 100 examines perceptions of companies by the China general public based on over 26,000 ratings collected in the first quarter of 2016.

“The success of a company depends on its ability to get people to support it,” said Nicolas Georges Trad, executive partner at Reputation Institute. “In China, which is the largest market in the world, it’s especially important for global companies to establish a strong reputation. The results of the China RepTrak® 100 tell us which companies are best regarded by the Chinese general public, what drives trust and support, and how the top companies are living up to the general public’s expectations.”

The complete ranking of the China RepTrak® 100 companies can be found at

http://www.reputationinstitute.com/china-reptrak-research.

About Reputation Institute

Reputation Institute (RI) is the world’s leading research-based consulting and advisory firm for reputation. RI enables many of the world’s leading companies to make more confident business decisions that build and protect reputation capital, analyze risk and sustainability topics, and drive competitive advantage. RI’s most prominent management tool is the RepTrak® model for analyzing the reputations of companies and institutions — best known via the Global RepTrak® 100, the world’s largest and most comprehensive study of corporate reputations, as well as Country RepTrak® and City RepTrak® studies that look at reputation across organizations within a given geography.

Learn more at: http://www.reputationinstitute.com/

 

About RL Expert

RL Expert Group (RL) is a boutique reputation risk management strategy consultancy and the Asia Associate of the Reputation Institute. RL Experts enable clients with proven strategies, tools and technologies to protect and support their license to operate, to mitigate risks and to exploit opportunities. These confidential services delivered via a lifecycle risk management approach underwrite the ongoing challenges faced by businesses and their officers operating in high-risk sectors.

RL brings together the leading experts across the globe to ensure that the "right talent" is helping our clients to solve the "right problems" at the "right time".

The RL Expert Group operate across 4 business practices: Reputation and Risk Management, Digital, Media and Crisis Communications, Sustainability and Research and Responsible Investment. It has operations in the United States and Hong Kong with its RL Experts located in Amsterdam, Geneva, Hong Kong, London, Melbourne, New York, Seoul, Singapore, Sydney and Zurich.

 

Learn more at: http://www.rlexpert.com

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