A company’s reputation for being able to deliver growth, attract top talent, and avoid ethical mishaps can account for much of the 30%-to-70% gap between the book value of most companies and their market capitalizations. Reputation is a big reason Johnson & Johnson (JNJ ) trades at a much higher price-earnings ratio than Pfizer (PFE ), Procter & Gamble (PG ) than Unilever (UN ), and Exxon Mobil (XOM ) than Royal Dutch Shell (RDS ). And while the value of a reputation is vastly less tangible than property, revenue, or cash, more experts are arguing it is possible not only to quantify it but even to predict how image changes in specific areas will harm or hurt the share price.
The article illustrates the value of telling your brand’s story clearly and often. Too many companies keep this information hidden.
How effectively are you telling your stories in this era of transparency? Do you know when you’re telling the right story, from the right angle?
In an upcoming post, I’ll share with you what’s involved in creating a great story. In the meantime, you can get started by developing some characters.