How Much Does a Little Bad Buzz Affect a Brand’s Perception? A Lot, It Turns Out

Rankings show negative news ruins everything

Life was easier for brands in the old days. Prior to the rise of social media—make that internet media, period—a company could use its advertising to build and sway the perceptions of the consuming public. Dollars drove opinions. Today, of course, that correlation is out the window. Increasingly, how a customer regards a brand is a function of all the chatter out there: advertising messages, sure, but also news and buzz (good or bad) piped through traditional and social-media channels.

Need proof? Check out the results of research house YouGov's just-released ranking of America's best-perceived brands—or, more to the point, those that dropped to the very bottom of it: Chipotle, Wells Fargo, Samsung and the Trump Taj Mahal. Last year, these brands all suffered bad publicity and watched their consumer perceptions plummet as a result.

The upshot? Great advertising is as important as ever, but if your brand's woes make the media, marketing won't save you.

Each year, YouGov conducts about 1.2 million interviews with consumers, asking them what they think of some 1,500 brands. "We poll people to consider advertising, but also what they've heard in the news media and social media," said CEO Ted Marzilli, "so it's very broad." The brand's final score ranges from -100 to 100, with a score of zero indicating a neutral opinion.

The top of the ranking is full of the brands that aren't only deft marketers but have a way of maintaining good buzz. (We'll get to them in a moment.) But it's the brands that lost the most ground that warrant a look.

Once upon a time, all of the bottom finishers on YouGov's 2016 survey were darling brands, some of them very recently. But as this bottom-five chart demonstrates, bad news disseminated via traditional or social media can end those glory days overnight.

For example, Wells Fargo was one of the few financial institutions to emerge with its reputation largely intact after Wall Street's 2008 meltdown. But after it came to light that bank employees had opened millions of accounts in customers' names without authorization to do so, the salad days were done. "Wells Fargo and Wells Fargo Advisors were both impacted by the fake accounts scandal that was big news," Marzilli said.

With Chipotle, it was food-safety issues that got huge media play, as did the chain's decision to shut its entire system down for a day in February. And even if you missed all the incendiary news online about Samsung's Galaxy Note 7's propensity to catch fire, Marzilli recounts how major airlines played a role in eroding customer perceptions. "For a two-week period," he said, "anybody on a flight heard the announcement that if you have a Samsung, you need to take out your battery."

As for the Trump Taj Mahal—the Atlantic City, N.J., casino that shut down last October—part of the perception dip probably had to do with Donald Trump's own propensity for picking fights and throwing Twitter bombs. Even so, Marzilli said, "that casino did go into bankruptcy and close. So I think it's a bit of both."

But YouGov's data also shows how, by contrast, favorable news and solid customer service benefit a brand's perception among consumers. Take Uber, for example.

"Uber has been in the news a lot, and it's still a controversial brand," Marzilli said. But Uber has also been on a steady expansion path, giving more of America a chance to try the service. What's more, Uber's growing market presence has forced traditional livery companies to update their technology to better compete, which may well have elevated consumers' experiences with livery cars overall. In any case, good word-of-mouth about Uber has led to a corresponding improvement in consumer perception.

As Marzilli hastens to point out, since there are 1,500 brands on the index, even an improvement in perception doesn't necessarily mean that a brand is in positive territory. Case in point: Radio Shack, which is still under the cloud of its 2015 bankruptcy and the closing of nearly 1,800 stores. That said, the legacy retailer did gain a new CEO in 2016 who said the company was turning around. Similarly, Comcast, which made news in 2014 and 2015 for its hellish customer-service department, at least started to stagger out of the woods in 2016. Its perception improved on YouGov's ranking, though it was still in negative territory.

Finally, when it comes to the top 10 best-perceived brands, the most telling thing, apart from the fact that half of them didn't exist a generation ago, is this: Not only are these companies highly effective marketers, they're brands that managed to fully integrate themselves into consumers lives, online and off. They keep the buzz positive, and it makes a difference.

For example, Amazon, which also ranked No. 1 for 2015, not only stays top of mind with consumers with a world of product offerings and fast delivery, it continues to diversify its brand—most recently, with Echo and Alexa—which only adds to the buzz the company gets already.

As for the next three—Netflix, YouTube and Google—Marzilli observes that these brands owe their high ranking not just to marketing, but to relevance. "As media continues to move into the nontraditional, these three become more of part of our daily lives," he said. "And Google is where many people start their day."

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