Online reputation management is hot -- but is it ethical?

It's no secret that blogs, forums and other online chatter can make or break a company's reputation. Just ask Kryponite, which makes high-end locks for bicycles and other sporting equipment. The company's worst nightmare came true in 2004 when a post on an online bicycling forum revealed that an expensive Kryptonite lock could be opened in seconds with a ballpoint pen.

Within days, word had spread to news services and thousands of bicycle enthusiasts around the world. Once the news got out, the company created a voluntary lock exchange program and replaced more than 400,000 locks in 21 countries for free. Kryptonite also ended up redesigning the equivalent of nine years' worth of products in just 10 months.

"It's not easy to recover from an incident like that -- bad news travels fast on the Internet," says Gartner analyst Toby Bell.

Bob Waxman, on the other hand, has taken advantage of online buzz to promote his book, Kabbalah Simply Stated (Paragon House). In 2004, the Kabbalah instructor sought the services of search engine marketing agency Elixir Systems. In addition to writing and distributing a press release on Waxman's behalf, the company combed through his Web site, conducting a metadata analysis of its content and adding keyword tags to his pages to help boost the site's ranking on Web searches for Kabbalah, which is an aspect of Jewish mysticism.

These search engine optimization (SEO) techniques helped increase traffic to his site and boosted its ranking on search engines such as Google, Yahoo and MSN, says Waxman. His press releases continue to score high in Google searches, he adds.

Waxman's experience with Elixir Systems reflects the surge of individuals and companies who are tapping SEO vendors and a burgeoning line of online reputation management services to pump up their cyberstatus. But not everyone agrees that such practices are fair. What's viewed as Web-savvy to some is seen as unfairly manipulating search results by others.

A new twist on marketing

Online reputation management "is a space that's hot and is heating up further," says Jeff Zabin, an analyst at Aberdeen Group Inc. who recently co-authored a report on social media monitoring and analysis. Executives are waking up to how the Internet can be used as an early warning system to alert them if their company's brand names and reputations are at risk as a result of a product defect, a disgruntled customer's blog rant or some other looming crisis, says Zabin.

If the news is bad, SEO techniques can help level the playing field. Sophisticated algorithms and other techniques allow manufacturers, retailers and other types of businesses to suppress unfavourable blog posts about their companies, and learn things about consumer preferences and perceptions of their brands like never before.

"I think it's going to change how marketing and research is being done," says Mike Waite, vice president of panels and communities at market research firm MarketTools. The company has partnered with Umbria, a marketing intelligence company that specializes in monitoring social media, to analyze online consumer chatter about MarketTools' clients. "People are just beginning to discover how this kind of data can be applied."

Even though online reputation management is catching fire, some would-be corporate customers remain wary. Some executives "aren't fully convinced this is going to work -- it's a new space," notes Peter Kim, an analyst at Forrester Research He points to a recent conversation he had with executives from a 150-year-old company about online reputation management services. "They said their board of directors wouldn't be ready for this," says Kim.

For its part, Microsoft has been piloting social media monitoring services from multiple vendors, including Visible Technologies, over the past several months. The software giant is mulling the use of these tools as a type of listening post to help it better understand what customers are saying in the blogosphere about their experiences with Microsoft products, says Sean O'Driscoll, general manager of Microsoft's community support services.

O'Driscoll says he doesn't expect a single vendor to meet all of the company's social media monitoring needs, so the company will likely select a set of vendors over the next three to six months. It comes down how well these systems can scale and how effectively they work, says O'Driscoll, adding, "It's a space that's still very much in its infancy."

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