By Dave Yonkman
Albert Einstein marveled at compound interest – calling it the 8th Wonder of the World – because it demonstrates how small investments can grow big over time.
It's like a snowball rolling downhill that gets bigger as it goes. Your bank adds the interest you earn to your original deposit, then pays interest on the new total. The process repeats, making your money grow faster than if interest was only paid on your initial deposit.
Just like the snowball, adding more to your investment over time makes it grow even more.
Similarly, consistent positive actions in public relations can build a great reputation that grows exponentially over time.
Think of your initial investment into your reputation as the first good impression you make on a customer.
The first impression could be a news article they read about you in a publication they trust. It could be a video your company posted on LinkedIn. It could be the employees they met at an industry event you sponsored.
Like your initial bank deposit earns interest – which then earns more interest – a good reputation builds from consistent positive media mentions, social media posts and customer interactions that keep adding to your “reputation bank.”
Each interaction is not only a one-time benefit. It builds on the past.
The real magic happens over time with the interest on the interest. In public relations, it is the ongoing accumulation of positive press, social proof and word-of-mouth referrals. Every new positive story builds on the layers of good reputation established before, much like the snowball effect, growing more significant.
Just as making larger deposits can accelerate the growth of your savings through compound interest, engaging the news media, sharing valuable insights and participating in community or industry events can amplify your reputation.
Over time, your efforts compound, leading to a reputation so strong that it opens doors, attracts opportunities and establishes a level of trust and authority that your competitors cannot match.
How do you work on building your business’s reputation?
First, reach out to journalists and bloggers who write about your industry. They want to know about your company and the unique insight you offer. “Like” and “share” the news stories they post on social media. Suggest coverage ideas to them that aren’t necessarily about your business to build trust with them. Offer your expert opinion on current trends.
Consistent, positive interaction with the media leads to more favorable coverage. As reporters see you as a credible and reliable source, they're more likely to turn to you for commentary or feature your business in their stories. Getting your company in the news increases your visibility and enhances your reputation.
Second, provide helpful information related to your industry on your website blog and LinkedIn, as well as through webinars or in-person workshops.
Regularly sharing expertise positions your business as a thought leader in your field and builds a reservoir of goodwill and trust. People come to rely on your business for valuable information and associate you with expertise and generosity in sharing knowledge.
Third, sponsor local community and industry events. It shows your organization cares about more than profits. You’re invested in the well-being of their customers and community. Over time, you build a positive image of your company that enhances trust and loyalty among current and potential customers.
Each of these opportunities might seem small on its own, but like compound interest, over time, they add up. The positive effects compound, leading to a stronger, more positive reputation that can significantly benefit your business in the long run.
You can also track the results of your efforts to see how well they’re working.
Monitor your website performance with tools like Google Analytics. Set up basic news alerts on search engines like Yahoo and Bing to know when your business appears in the news. Social media platforms provide their own resources for measuring your impact. All of these tools offer free versions.
Combine data from these tools to better understand how your public relations activities influence your company’s reputation, visibility and ultimately, its success.
As management guru Peter Drucker famously said, “You can’t improve what you don’t measure.”
You can grow your reputation even in lean times.
People who buy your products and services feel the same economic pressure as you.
Rising costs make it more difficult to get even a meager profit. Buyers are much more discerning when they have less money to allocate.
When your customers need to make tough choices about where to spend their limited resources, they'll opt for businesses known for their integrity. This reputation can be a deciding factor that sets you apart from competitors.
A strong reputation fosters loyalty. Loyal customers will more likely continue doing business with you even when their budgets tighten. They can also become your advocates by recommending you to others. It is invaluable when customer acquisition becomes more challenging and expensive.
Same goes for attracting quality employees. Even in a recession, talented individuals prefer to work for reputable companies, with salary often a secondary motivator. A good reputation ensures that your business not only retains its valuable employees but also attracts new talent.
Be patient, persistent and consistent.
Stick to the basics and remember that consistency yields results.
Warren Buffet’s wealth didn’t happen because he deposited his newspaper delivery money in the local bank at 15 years old and did nothing else.
Apple didn’t become the world’s most respected company among investors in 2023 because it produced the Macintosh in 1984.
It took regular investments over time to compound into a fortune.
The same forces that stoked Buffett’s and Apple’s finances and reputation are the same forces stoking your success.
Your reputation, much like your financial wealth, thrives on the seeds you plant today, nurtured by consistency, strategic engagement and genuine contributions to your community and industry.
What's your next move? Are you ready to make a deposit into your reputation bank? Draft that press release, shoot a quick video on your phone for LinkedIn and make your presence felt at the next big event.
Every effort counts, no matter how small it might seem at first.
In a world in which your next opportunity could hinge on the strength of your reputation, can you afford to wait?
Start compounding your reputation today and watch as it opens doors to endless possibilities tomorrow.