Reputation in Volatile Markets

Stretching out with the weekend papers and a temperature-perfect flat white whilst the children quietly potter in the garden on a warm, lazy Saturday afternoon is the stuff of fantasy and home improvement ads.

But, quite remarkably, Dr Serendipity made a welcome house-call this weekend past and I had a full 26 minutes before the little cherubs started chasing the wildlife, testing the suffocation properties of a plastic bag and, my now tepid, coffee hit the deck in the subsequent melee.

In these volatile times, you can do a lot in 26 minutes. Bake a dinky little chocolate cake perhaps or maybe just lose a billion dollars on the markets. I opted for the less radical alternative of pawing through the lifestyle pages before the curfew on parental responsibility was lifted.

It’s amazing how insightful even the fluffiest of topics can be when well written, marginally provocative and resistant to the lure of celebrity. Take the world of high-end fashion for example, a place where the wealthy and the beautiful join forces to remind us all that those with the highest cheekbones, win.

As a serious commentator of this ever-pouting world, the FT’s Fashion Editor, Vanessa Friedman, treads a very thin line. Working for a publication where economics are considered sexy and smart thinking is de rigour, she’s always in danger of slipping on her sparkly train of unassailable hope and fatuous self-indulgence.

And yet, every week, Friedman manages to navigate her way down the catwalk of false love and loathing to remind us all that fashion not only remains a multi-billion dollar industry but that it continues to define so much in contemporary society.

Her 10 September piece on family members most likely to inherit the reins of some of the world’s biggest luxury brands was a case in point. Low key and thoughtful, it flagged the very real commercial concerns of aging business leaders where eponymy has become both a help and a hindrance in their latter years. The dilemma is relatively straightforward. There may be better future CEOs outside of the business, but it is family members that pass the thread of continuity between today and tomorrow through little more than a name.

So how do you prepare the future leader of a luxury brand? Well, of the ten names listed (from Silvana Armani to David Lauren), five currently have responsibility for all aspects of public relations, marketing and communications. These are not titles of convenience. They are a recognition that an understanding of brand reputation is as important to future CEOs as the functions of business administration.

To say so is far from a self-indulgent pat on my own industry’s back. It is a simple fact of commercial life that brand equity and business reputation are now considered as significant an asset as any other tangible within a business. All the more so when an individual’s name is the brand itself.

I could wax lyrical about the changing dynamics between market value and brand equity. But in the spirit of deference and delegation I’ll leave that to my colleague at Weber Shandwick, James Abbott, whose article about reputation in volatile markets says it better than I ever could.