Benefit of the doubt is a key indicator of corporate success or failure.
To understand exactly what is meant by benefit of the doubt and the scope of its impact, it’s useful to define reputation and supportive behaviors.
What is reputation?
At RI, we define reputation as the emotional connection a person has with a company (industry, CEO, country, city) — that is, whether a person loves, hates, or is indifferent to a given company, and to what extent. We quantify this emotional connection numerically and it translates to a reputation score, ranging from poor to excellent.
How support impacts reputation
In addition to monitoring, measuring, and quantifying reputation, we also measure supportive behaviors. These include willingness to purchase, invest in, work for, trust in, and give benefit of the doubt to a company—all direct consumer actions that drive a company’s bottom line.
Support may be understood as having a causal relationship with reputation. A person’s emotional connection to a company will dictate how they interact with the company. The supportive behavioral outcome is a direct result of the emotional bond the public has with a company.
Are you getting the benefit of the doubt?
While the other supportive behaviors (willingness to purchase, invest, work for, and trust in) are mostly self-explanatory, benefit of the doubt deserves further exploration.
When we talk about benefit of the doubt, we are referring to risk mitigation—a company’s ability to maintain high levels of stakeholder support in times of crisis. When we field our research, respondents rate the following statement on a scale from 1 to 7:
“I would give the benefit of the doubt to [company x] if the company was facing a crisis”
1 equals “strongly disagree” and 7 equals “strongly agree”
Companies with high levels of benefit of the doubt will be supported by the public. In a time of crisis the public will favor trusting the company over distrusting them. What differentiates these more trusted companies is that they tend to have built up more reputational equity with their stakeholders.
Historically, companies who are not publicized negatively in the media also receive typically higher levels of benefit of the doubt by the public. In turn, these companies bounce back from crises more quickly, seeing reputation stabilization after the issue at hand settles.
Now, let’s take a look at two companies; one with high levels of benefit of the doubt and one without.
Company reputation faceoff: JetBlue vs. Hugo Boss
JetBlue and Hugh Boss are both consumer-industry companies measured by RI in 2018 who have opposing levels of benefit of the doubt ratings by the general public.
Figure 1: Benefit of the Doubt Distributions, source: Reputation Institute
JetBlue has the lowest and Hugo Boss rises 25% higher. What we’re seeing here is a significant range of support in times of crisis between these two companies.
Given the recent news surrounding JetBlue, it’s no wonder we see such low levels of support. The Wall Street Journal named JetBlue the “worst airline in America” this year, citing their extreme delays and numerous cancelled flights.
Companies should take note—both lack of bad publicity and continuous good media representation help maintain high benefit of the doubt by the public.
Benefit of the doubt is waning—a warning to companies
However, amid the cultural zeitgeist of our era, companies are being judged more critically than ever. Not surprisingly, support has dropped significantly since last year. As seen in Figure 2, corporate US average benefit of the doubt levels have dropped 14% for all in-project companies.
Figure 2: Benefit of the Doubt Distribution United States 2017 vs. 2018, source: Reputation Institute
The public no longer gives companies benefit of the doubt without reason, and a few bad stories could hurt a company’s long-term favoritism for years to come. the public is much less likely to back companies in times of crisis, which should serve as a warning to corporations globally.
How to increase your company’s benefit of the doubt
Reputation-ready companies are those that are prepared for a crisis; they are trusted by their stakeholders to do the right thing and have built enough reputation equity to be given the benefit of the doubt. This is where all companies ideally want to be. A proactive move toward risk mitigation is what increases benefit of the doubt and keeps companies secure.