Reputation Vs Cash Flow: 4 Reasons They’re Connected

Money is directly linked with marketing and a digital presence.

 

These are the things which bring traffic to the eCommerce and physical stores and boost conversions. Or, if there isn’t an online or high street shop, then it should convince advertisers to pump money into the business. It has nothing to do with reputation – the industry is a numbers game.

United Airlines may beg to differ. After the company broke a guitar and the musician made a song about it, the stock fell by 10%. It cost them nearly $200,000 million. Whether it’s a scandal, disgruntled customers or employees, the effect on status can be monumental.

 

Here are four reasons why reputation can have a huge impact on cash flow:

 

Feet Vote

 

Consumers vote with their feet. They might not get the result they wanted – an apology and compensation – but they understand the game. By bouncing to a competitor, they will hit the firm where it hurts. And, they aren’t scared of taking their friends with them, or anyone else that will listen.

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In the technological era, shoppers can vote on their mobile devices too. Review websites mean that word of mouth teams up with a poor online presence to portray a pretty bad image. If customers didn’t leave before, they will now.

 

Morality Debate

 

Back in the good old days, no one cared about where the products or services came. As long as they did the job and were cheap, the society was happy and willing to spend. Today is different. The smallest of offences can result in a mountain of trouble for entrepreneurs.

 

Check out the details at SkinnerLawFirm.net if you’re skeptical. Consumers won’t put up for anything dodgy or sneaky because they value their morals. There is a reason vegan stores and restaurants and green companies are skyrocketing in popularity. They make their customers feel good while providing a quality service.

 

Are You Satisfied?

 

On the whole, satisfied shoppers are likely to spend twice as much as any other customer. Yes, that applies to new ones too. After all, it can cost up to five times as much to attract traffic and keep them loyal.

 

By far the best option is to keep everyone satisfied and let them spend money. They won’t do this if there are scandals that rock their confidence. Yahoo.com has a list of the most reputable firms in the world and the top ones also happen to be the biggest organizations in their sectors. This isn’t a coincidence.

 

Tinned Sardines

 

Businesses are packed into the industry like sardines in a can. Anywhere a customer looks there are three, four or even five options from which to choose. There has to be a way for them come to a decision. Rightly or wrongly, they almost always use recommendations and reviews.

 

In short, people check the reputation of the company first before making a decision. If your status is below the average, then you’ll get kicked to the curb and be out of the conversation.

 

Money is affected by many things, but reputation is a major player.

This post is for educational purposes only.

 

Ken Boyd

Author: Cost Accounting for Dummies, Accounting All-In-One for Dummies, The CPA Exam for Dummies and 1,001 Accounting Questions for Dummies

Co-Founder: accountinged.com

(email) ken@stltest.net

(website and blog) https://www.accountingaccidentally.com/

(you tube channel) kenboydstl

 

Image: Bullseye, Jeff Turner CC by 2.0