Business Authenticity Is an Ingredient for Long Term Success

Apologize, fight back, or lie low. That’s the question when a PR crisis occurs. Many say you should be totally transparent all the time, but there is such a thing as over-sharing. When it is time to be transparent and authentic, it’s cheaper in the long run.

When it comes to business, there’s a prevailing attitude that says to do whatever it takes to get the job done. This drive can be important for success. Yet all too often, business owners sacrifice authenticity to pursue profit and growth.

Not only can this cause short-term problems, but a lack of apparent authenticity could lead to the downfall of your business. Now, more than ever, brands must stay true to their values — in how they operate, communicate with customers, and relate to their workforce.

Walk the Walk, Talk the Talk

The way business is done changed drastically over the last century. There was a time when the only thing customers cared about was the product or service. Companies were free to make false claims in advertising, and few laws required ingredient labels or production disclosures.

Now, it’s vitally important to customers that the businesses they patronize have positive corporate policies, including green values, ethics, and principled marketing and production practices.

Unfortunately, some companies say they follow a higher path but do not. A major part of this issue is what is called greenwashing, where a business presents an image of being environmentally conscious while hiding its real practices. A company may even put out false advertising — a pattern Ryanair has demonstrated repeatedly. The airline claimed to be environmentally friendly despite being one of the worst carbon emission offenders in the European Union. The UK Advertising Standards Authority subsequently banned Ryanair ads for misleading environmental claims on multiple occasions, including rulings in both 2020 and 2023.

Many other companies have been called out on false claims. Kellogg’s was famously caught saying that their Rice Krispies Treats boosted the immune system. After a lawsuit, they retracted the claim and paid a $5 million fine.

In the age of social media, the story of misdeeds can travel far and wide in minutes. If you are truthful about how you do things, it will go a long way. Don’t get caught lying.

Own Your Mistakes and Be Transparent

When a PR crisis hits, you have a few options: apologize, fight back, or lie low. Most of the time, an authentic apology is the way to go — after all, the crisis has already occurred.

Everybody makes a bad decision or falls short of perfection. Even the most well-planned advertising campaign can come off as offensive.

When it’s time to apologize, own your mistake and make it right as quickly as possible. This authenticity will go far with your customers and the public.

If you have created a track record of authenticity, you will have built up a positive reputation. Your history will show that you do the right things, and customers will be more likely to stay with the company as you correct your mistakes.

It’s also important to have an authentic conversation with offended parties, whether a single customer or a group that has been wronged. This public discussion can show that you understand what happened and help educate your workforce so the same mistakes aren’t repeated.

Transparency in Operations and Policies

Transparency is important in many ways. It’s vital that you aren’t hiding things from the public in ways that, should they come to light, would cause a catastrophe for the company. When it makes sense, be transparent.

This can include relevant manufacturing practices (not trade secrets), internal policies that may affect stakeholders, and involvement with political organizations — especially since these are often reported online. If your actions align with the image you project publicly, there shouldn’t be an issue with allowing the inner workings to be seen. This isn’t saying you need to reveal your secret recipe, but allowing inspectors to observe how your factories operate, how you treat workers, or opening your books to receive an ESG score is a different matter. It’s worth noting that the ESG landscape has shifted considerably in recent years — the EU’s Corporate Sustainability Reporting Directive now mandates expanded ESG disclosures for many companies, and regulatory pressure around climate reporting continues to grow in markets worldwide.

Transparency in workplace practices and open communication with employees also matters. If you create an environment where employees don’t trust the business, they will leave. Word spreads about what it’s really like to work somewhere, making it harder to attract quality talent. Productivity can plummet, and your reputation — inside and out — will begin to suffer, as will your profits.

Be Honest in Marketing and Advertising

Marketing is often about putting the best face on a product. However, there are times when companies have gone too far and been accused of outright lying in their marketing.

One common issue is when companies use celebrity endorsements for financial products. Endorsers discuss brands in ways that imply personal belief and investment, while skipping over the fact that they are paid and may know nothing about the product. Kim Kardashian settled with the SEC for $1.26 million after failing to disclose that she was paid $250,000 to promote EthereumMax tokens on Instagram. A Super Bowl commercial featuring Matt Damon became the target of widespread scorn after the crypto sector’s broader collapse — including the implosion of FTX — eroded public trust in celebrity-backed digital asset promotions.

In a more comical example, Pepsi was embroiled in a scandal in the mid-1990s when they appeared to offer a Harrier Jet as part of their Pepsi Points incentive program. A pair of resourceful young men saved enough points to claim the jet, but Pepsi insisted the commercial was a joke — despite no disclaimers. The case went to court, with a final ruling in 1999, and became a landmark standard for truth in advertising and the importance of legal disclosures in commercials.

If you offer a solid product with honest marketing, you won’t fall into this trap. Understanding what constitutes reputational harm before a campaign launches is a smart safeguard against costly missteps.

Competition vs. Copycatting

There’s a difference between competing and copycatting. It’s fine to have a similar product to someone else — but find a way to make it yours. When branding, don’t use close-sounding names or images in an attempt to ride the coattails of another company.

This goes for marketing designs as well. In the 1970s, NBC rolled out a new logo that looked suspiciously like the Nebraska Educational Television Network’s logo. After being called out, NBC settled, in part giving the educational group half a million dollars in equipment.

Many flash-in-the-pan companies try to profit from popular products by knocking them off with cheaper versions. If you are looking for longevity and customer trust, this route is bound to end in failure.

Larger companies have tried this too. Amazon has been consistently shown to create its own versions of popular products offered on its own website and undercut sellers, even manipulating search results so its products overshadow small businesses — conduct that has drawn significant regulatory attention. The FTC filed a major antitrust lawsuit against Amazon in September 2023, with allegations that include anti-competitive search manipulation practices.

Someone trying this on a smaller scale will most likely not only be called out publicly but could face legal infringement issues that could end their business.

Treat Your Workforce with Respect

Authenticity is also important in the office. If you treat your workforce with respect and follow through on what you promise, your employees will be more likely to support you.

Listen to your employees and their needs. Many companies fall into the trap of offering simple perks in lieu of real support. Instead of discount movie tickets, look into workers’ actual needs and consider health care additions or child care. By showing true attentiveness to your workforce, they will reward you with loyalty.

Be clear on employee policies regarding health care, leave, benefits, pensions, and workplace rules. Make sure you follow through on those policies and that management is held accountable. A company that has rules about discrimination but turns a blind eye to violations will quickly find that workers won’t stand for it.

If workers believe in the mission of a company, they are more likely to be supportive and give their best. As you grow, this approach attracts more high-quality workers. This internal culture of honesty is a cornerstone of any sound corporate reputation strategy.

Authenticity Leads to Genuine Partnerships

There’s a lesson from personal life that applies to business. When you’re authentic, you attract people who agree with your approach. You won’t have to worry as much about partnerships with people who don’t align with your values — which can put you in a bad light by association.

Being authentic helps you weed out false partners before they cause damage. This leads to a better road ahead, with less chance your business will be dragged down by bad actors.

This is especially important for B2B companies. There are times when authenticity is vital and choices need to be made about whom you work with. However, there is a fine line between an authentic business decision and personal feelings of management coming into play. This can be a slippery slope and could be interpreted as discrimination or conflicts of interest, so make sure decisions are well thought out and discussed before any choices are made.

Key Takeaways

• Make sure the message you put out to the public aligns with your actions, both externally and behind closed doors.
• When you make a mistake, own up to it and make it right.
• Listen to the public and don’t ignore their concerns.
• Be transparent in your operations and policies.
• Create marketing and advertising campaigns that are honest and make truthful claims.
• Be unique and create your own style without stealing the ideas, branding, or concepts of other businesses.
• Listen to your workforce and their needs. Present them with real policies that help them feel respected and secure.
• Follow through on internal policies and hold offending parties accountable.
• Be genuine in your relationships with vendors and other companies to ensure honest partnerships that lift your business up.