'Tough Talk' and 'Soothing Speech': Managing Reputations for Being Tough and for Being Good

Abstract

A company often must manage its reputation with multiple stakeholders in different ways. This paper develops an interdisciplinary model for reputation management based on a historical case study of Wal-Mart. The model draws on impression management, stakeholder and game theories. We find evidence that Wal-Mart had at least two reputations — one for being tough with suppliers, and one for being good to customers and investors. In order to maintain these beneficial reputations, Wal-Mart accompanied strategic actions towards suppliers with tough talk, an assertive tactic for impression management that helped the company maintain a tough image. Negative supplier and trade media responses threatened Wal-Mart's positive reputation with other stakeholders. To prevent this negative information from crossing the boundaries of stakeholder group networks and marring its good reputation, the company used soothing speech, a type of defensive impression management tactic that painted its actions in a more positive light.

Keywords: reputation, identity, brand, stakeholder, image, communications, intangibles, philanthropy, advertising, positioning, corporate branding, e-communication