Michael D. Moberly – January 29, 2024 – Business Intangible Asset Strategy & Risk Mitigation – Founder, Business Intangible Asset Blog & kpstrat
There remains a lot of guesswork, subjectivity, and weary conventions, standards, and practices regarding brand – reputation valuation and the consequences of reputation risk, and the repair costs.
We are obliged to recognize that brand and/or reputation, of, to, or for an individual or a business, are intangible (non-physical) assets. As assets, (not liabilities) both reputation and brand contribute to business, et al, attractivity, differentiation, valuation, and revenue generation potential.
Professor Ashlee Humphreys, a professor of consumer sentiment at Northwestern University was called as a witness by E. Jean Carroll’s lawyers, as an expert on (reputation) damages.
Professor Humphreys calculations included…
- how many people saw those (defamatory) statements, and
- how much the jury ought to award Carroll in compensation (for defamation), and
- estimates of the cost of a ‘reputation repair campaign’ for E. Jean Carroll.
Humphreys…
- was contracted to (a.) analyze the reach of Donald Trump’s defamatory statements, and (b.) assess the damage to Carroll’s reputation.
- had created a (hypothetical) reputation-repair campaign (process) designed to…
-
- change the minds of the nearly 25 million people that she estimated were likely to have been receptive to Donald Trump’s (defamatory) comments about E. Jean Carroll.
- described the (probable) viewership of tweets, articles, TV broadcasts, and other media, regarding Mr. Trump’s (two) denials reached up to 104.1 million people, which she considered to be an…
-
- undercount because her examination did not capture media organizations that paraphrased Trump’s denial of the rape and disparagement of Carroll as a liar.
- testified that (a.) the attitudes at issue here are strongly held, (b.) 30% of the readership in-particular Elle, where Carroll was a longtime advice columnist, is politically conservative, (c.) it didn’t help that Mr. Trump continued to disparage Carroll in the years since his initial (defamatory) statements, including at a press conference in New York Wednesday the day after the trial, (d.) in general, repeated claims only strengthen people’s attitudes when they come from a trusted source.
- suggested for E. Jean Carroll, a reputation repair campaign would essentially amount to an advertising campaign across different media platforms that would try to persuade them to believe Carroll and suggested Carroll could place messages with influencers trusted among Trump’s audience, like Joe Rogan and Candace Owens, and pay for advertisements to appear multiple times.
As readers know, Mr. Trump (the defendant’s) self-declarations of brand – reputation valuation are frequently conveyed publicly and variously contested legally.
This is one, among several reasons why Professor Humphreys calculations are particularly important today. Because conventional methods and/or standards for treating (assessing – measuring) reputation – brand valuation as the intangible assets they are, fall short of what’s necessary today as more businesses become increasingly intangible asset intensive, dependent, and reliant. https://kpstrat.com/business-reputational-risksa-different-perspective-ii/
Humphreys also testified…
- her analysis estimates of Mr. Trump’s 2019 (defamatory) statements garnered somewhere between 85.8 million and 104.1 million impressions from social media, television, and online stories.
- that’s probably a low estimate, Humphreys said, because she didn’t factor in certain data sources like Facebook, Reddit, or local news outlets.
- that the damage of Mr. Trump’s (defamatory) statements at issue – in this case “was severe to her [Carroll’s] reputation as a journalist, and the costs to repair same are considerable.”
- that someone in those audiences would need to see corrective messaging as many as 7 times to change their minds,
- it could cost up to $12.1 million to implement a campaign that could change the “strongly held” attitudes of people who likely believed Mr. Trump’s (defamatory) statements.
Because of the political valence, Humphries suggested, as measured by the number which brand – reputation can potentially, (a.) displace, or (b.) combine with, relative to, (c.) Mr. Trump’s denials, it’s understandably challenging to (presume) people’s minds will change,
Should we accept Humphreys analysis, which I do, business leaders, management teams, boards, investors, and operating cultures, etc., are obliged to…
- recognize reputation safeguards, risk mitigation, and monitoring are necessary.
- consider how long it would take to re-build a ‘reputation and its contributory roles to not only a business’s valuation, but also to its competitiveness and revenue generation capability, etc., relative to the,
- understand the asymmetric nature and keystroke speed which reputations – brands can be intentionally – nefariously targeted, undermined, damaged, and irrevocably destroyed.
In these contexts, we are obliged to reflect on recent statements by some airline executives about ‘errors in the design, manufacture, and assembly (quality control – oversight, etc.) of Boeing’s 737 Max aircraft…
- relative to the very dramatic public ‘risks’ same pose to passengers, are adversely affecting airline brands – reputations.
This is likely another example of brand – reputation risk reach and how same is now being understood and framed by business leaders, as well as buyers – users (and/or victims) of branded products and services which hold particular risks.
That is, a business’s brand, reputation, and its operating cultures which underlie both are indeed ‘mission essential’ components and should be treated accordingly.
It’s possible, a similar portrait will emerge with-regard to (a.) valuation of particular-Trump branded properties and (b.) calculations of Mr. Trump’s wealth, e.g., property valuation fluctuation may be reflected via allegations – sanctions of (criminal – civil) impropriety associated with or materializing from those properties and translate as liabilities.
An authentic quote on such matters is attributed to Warren Buffett, who reportedly said, “it takes 20 years to build a reputation and five minutes to ruin it, if you think about that, you will do things differently”. (Aug 9, 2020)
Readers can find numerous posts @ Business Intangible Asset Blog that describe my ‘contributory role methodology’ for the valuation of business’s ‘mission essential’ intangible assets.
Posts @ Business Intangible Asset Blog present various ‘risk realities’ that warrant attention of business leaders, entrepreneurs, R&D administrators, management teams, boards, and investors across sectors. Mitigating (reacting, responding to) the often ‘public – viral’ risks and challenges produced by reputational risks, are obligations with little room or time for equivocation or error.
The Business Intangible Asset Blog was created in 2006 and now includes 1100+ topic specific posts intended to provide readers, ala business leaders, management teams, R&D administrators, boards, and investors, etc., with reliable insights to the application, valuation, competitiveness, revenue generation, and sustainability contributions of intangible assets.
Posts at Business Intangible Asset Blog are intended to draw attention to the development, application, management, safeguards, and risk mitigation of business’s ‘mission essential’ intangible assets.
Readers are respectfully invited to explore other – similar posts, along with books, pamphlets, and papers available @ ‘Business Intangible Asset Blog’ and kpstrat.com.
