Corporate troubles and scandals around the globe and across industries will have a lasting impact on the way people view big business and big brands. It should have a lasting effect on the way companies name and position their brands, too.
Yesterday, President Obama signed into law the Dodd-Frank Wall Street Reform and Consumer Protection Act. It's a 2,300 page bill containing 533 new regulations. 38% of Americans have never heard of it. Another 33% couldn't explain its key deliverable. If the point of the legislation is to restore confidence in the financial system, it seems like it's dead on delivery, and you can bet that opinion of the bill is only going to get worse (or at best, muddled) as the administration's principled opposition continues to debate settled law and the nutjobs scream that it's further proof of an alien invasion. Consumers are going to continue to lose their faith in the markets. This isn't good for Wall Street.
In April, former Fed Chairman Paul Volcker announced a new program to restore confidence in government. The effort, known as the Campaign for High Performance Government, couldn't come soon enough. Confidence in government is near an all-time low. A survey released in mid-April by the Pew Research Center found that only a small minority of Americans—22 percent—believe they can trust the federal government "almost always or most of the time." More than half of the respondents (56 percent) said they were frustrated by government's actions; 1 in 5 (21 percent) said Washington makes them angry. And who can blame them? As I noted in an April column, "Managing Perception, Ignoring Reality," Washington appears out of control. The rules of the game seem to be rigged to keep government growing while few problems get solved. Nobody is held accountable and performance seems irrelevant.
U.S. companies from industrial giant Caterpillar Inc. to apparel maker Guess Inc. are plowing money back into their businesses at a rate that demonstrates growing confidence in the economy's recovery, but still leaves questions about its strength.
Toyota has begun the painful and difficult task of trying to convince consumers that they should buy the beleaguered company's cars -- even as worries mount that more bad news may be ahead. Capping a week of by-the-book crisis management, including television appearances by top executives, the world's largest automobile maker has begun to air a commercial aimed at restoring confidence in its vehicles.
Several years ago, my colleague Dave Ulrich and I looked at how leaders build value by building employee confidence in the future. Our findings bear revisiting as companies begin to emerge after the devastation of the last 18 months and work to create new value.
The "new normal" — the idea that when income, credit and confidence return, Americans will not return to our free-spending ways — is an idea on the march, recruiting everyone from PIMCO CEO Mohamed El-Erian to Wal-Mart CEO Mike Duke. It's spreading so fast it threatens to become the new orthodoxy. I believe the argument is flawed.
You've probably heard by now that "your brand is no longer yours." The assertion's based on simple math. In the era of blogs, discussion boards, Facebook, Twitter, and other Web 2.0 tools, virtually everyone can get online and talk about your company and its offerings. As a result, the amount of information your marketing and PR departments can generate is only a small percentage of the total volume of content on the Internet about your firm. What's more, if some of the external voices become as popular, or perish the thought, more popular than your official voice, then they're going to show up high in organic (as opposed to paid) search results.
As consumers, I think you’ll agree, prior to making any decision purchase, most of the time, our journey begins with a combination of online search and real world conversations with friends, family and peers. As the Web matures, a greater volume of our attention and focus continues to shift from other mediums to the Web for not only purchase considerations but also for content discovery. It’s how we learn. It’s how we stay connected.
Bank of America, one of the seven leading financial institutions to be affected by the government-imposed salary cuts, is breaking a new campaign today (Monday), aimed at rebuilding consumer trust. The new $40 million ad effort excludes financial lingo and other esoteric banking terms unknown to consumers. Instead, the bank, which earlier this month broke a campaign for its Merrill Lynch Wealth Management group, is using a series of spots with “simple, clear and direct” messaging to repair its relationship with consumers, BofA executives said. The goal of the campaign is to present the bank’s different products, and then show how they can help, the bank said.
Any corporation can be forgiven being a little anxious these days. Everyone's confidence is being tested. I interviewed Debbie Millman over the weekend, and she helped me see an unexpected connection between this confidence and the brand. When the corporation loses it's nerve, it ceases to take chances. It begins to white-knuckle its way through the world. It begins to lean towards stasis. The consumer may too.
Wells Fargo & Co. has told securities analysts that it expects its first-quarter earnings will be $3 billion, easily topping the $2 billion it made during the same period last year. Bank of America is significantly hiking the interest rates it charges at least four million credit card customers, and other banks have or will institute programs to force borrowers to pay more, and/or pay more often. So the banks needed public bailouts in order to free up lending again, and they're going to make a killing while making it harder for credit card users to borrow? This isn't just a communications nightmare. It's real.
Only 8% of American consumers have full confidence in banks and other financial service companies, according to an alarming new study from independent PR shop Waggener Edstrom Worldwide and RT Strategies.