4 January 2019

The social role of brands and key companies for their legitimacy and reputation


The words of Anders Dahlvig, former world director of IKEA, summarize what may be the biggest challenge for companies to achieve the legitimacy and reputation necessary to develop not only their marketing but their own business activity.

Today the most real and worrying threat for brands and companies is the difficulty in meeting the expectations of all their stakeholders of interest in relation to the role they should have in society and in people’s lives.

They face more challenges and more demands from their customers, their employees, the communities in which they operate, etc. They are required not only to assume their responsibilities for the impact they can have on people, society and nature, but to help transform the world to improve people’s lives, the well-being of communities and the future of the planet.

A very ambitious objectives and that not only have to do with the function normally attributed to companies, create economic wealth. The high expectations increase the gap between companies and people’s perceptions. This gap translates into a loss of confidence and alarming reputation in certain sectors and cases. The reputation of companies is at unknown levels. Only a handful of brands are considered necessary and significant for society and the people they serve, the rest are dispensable.

The popular imaginary assumes that, if it can, a company will behave badly to maximize the benefit of its owners, even if it involves requalifying a protected area, relocating its factories, bribing public officials or charging its customers exaggerated margins. This is a context that does not suit anyone, it is a context in which cynicism prevails and in which values ​​do not count.

As Joan Jimenez commented recently in these same digital pages, people have lost faith and trust in companies, the consumer is disenchanted and demands another sensibility on the part of brands that have not worried about this aspect, and yes in change have focused on maximizing their benefit and that of their shareholders, in always doing more (consumption) but not necessarily something better (quality of life).

To change this trend and close that gap in the reputation of brands and companies, something more than advertising campaigns, philanthropic initiatives or short-term and shorter-term actions is necessary.

This environment of distrust and low reputation is, as I said at the beginning, the greatest risk to survival that companies and entire sectors of our economy face for two main reasons.

  • On the one hand, the disconnection with people and their most basic and personal motivations (the intrinsic motivations of self-realization and search for meaning). Something especially serious for the brand in the age of connection and engagement.
  • On the other hand, the increase in regulations and restrictions on business in general, or marketing in particular, to impose a certain “social order”.

Note also that in the face of a possible crisis both aspects would accelerate dramatically and in a matter of moments.

To recover their reputation, and legitimize their very existence, to be able to do marketing, to be able to have a voice, companies will have to understand and attend to the desires and needs of people, not only material ones, but also those, let’s call them, “spiritual” that are born of the need for meaning and purpose. In addition, they will have to assume more and more responsibility for what Michael Porter and Mark Kramer call “externalities” and include social and environmental considerations at the center of their own raison d’être, not as something that constrains them but rather as something that It allows you to grow more and better.