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How Amazon's Reputation Eclipsed Apple's

Rick Newman

It's not easy beating Apple at anything, and it may be harder still for a company that has no stores, no face-to-face interaction with the public and no real product of its own.

Yet that's what Amazon has accomplished by coming in No. 1 in the latest Harris Interactive survey of corporate reputations. The online retailer displaced Apple, which was No. 1 last year, along with other top companies including Google, Walt Disney, and Johnson & Johnson. Since Apple is a company that generates obsessive interest, many analysts see it as one further sign of Apple's descent from the stratosphere. But the real story may be Amazon's surge, along with its ingenious business strategy and the cultural factors that allowed it to happen.

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Apple still ranks as a "great" company, by Harris's reckoning. But Amazon has one-upped it.

"Amazon's ability to execute and deliver is unparalleled," says Robert Fronk, executive vice president for reputation management at Harris. "They handle the rational and the emotional side of the customer experience equally well." Here are five surprising ways Amazon has ended up as the most reputable company in America:

Safeguarding private information. Amazon collects as much information about its users as Facebook, Google and any other Web-based company, including credit-card data and other sensitive details. Yet there are few controversies, if any, about Amazon using that data for marketing or other purposes that might cause privacy concerns. That establishes trust at a time when many other companies and institutions are losing it.

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Being helpful without being intrusive. Amazon's user reviews and product suggestions help guide shoppers to useful merchandise without the annoying pop-up ads, gimmicky come-ons or coercive efforts to control your computer that are ubiquitous on the Web. Amazon is also among the first online retailers to police product reviews, in order to guard against sellers trying to artificially inflate the appeal of their own products with planted reviews.

Creating an emotional bond without human interaction. One important element of a company's reputation is the emotional bond it establishes with its customers--something Apple excels at with its elegant gizmos and slick user interfaces. Walt Disney is another company that connects remarkably well with consumers, through its upbeat films and family-friendly amusement parks, along with a line of products that evoke both. For Amazon to achieve that kind of emotional bond with a business that's basically a delivery system is unprecedented.

Part of that bond comes from the trust customers place in Amazon. But Amazon may also be the unwitting beneficiary of social trends. "We're now in a nation where 40 percent of families are led by a single parent," Fronk says. "There's no one to come home to, and that Amazon box has become the warm welcome when you come home. Finding that on your front porch is your greeting at the end of the day."

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Accounting for problems. Amazon often makes it easier to return a product through the mail than physical stores where you might have to wait in line or argue with a salesperson about a missing receipt. Dealing with snafus used to be one of the perceived shortcoming of shopping online, since it could be difficult to reach a live person who could resolve the problem. But with a lot of griping about declining service standards at retail outlets, Amazon has turned a potential liability into an asset.

Keeping employees out of sight. There have been some notable complaints about work conditions at Amazon, which hires a lot of part-timers without benefits and requires some employees to do demanding physical work moving merchandise around at warehouses. But these issues haven't hurt its reputation, probably because customers never really see an Amazon employee.

"Amazon benefits from being a virtual company," says Fronk. "Employees are in the background." That may not be ideal for workers, but so far, customers aren't complaining.

Rick Newman's latest book is Rebounders: How Winners Pivot From Setback To Success. Follow him on Twitter: @rickjnewman.

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