What is Corporate Identity?
Whether you’re in big business or small business, the perceptions people have of your company are important. They shape everything from pricing to consumer profiles to survivability, and understanding how business identities are formed is essential for both owners and C-suite executives. Today, we’re going to be talking about corporate identity, but don’t stress – many (if not all) of these principles can be easily applied to small and micro businesses, albeit on a different scale.
Corporate Identity Definition
Like related concepts, such as brand, reputation, and image, corporate identity is a term that is not easily definable, and is still applied in a confusing and haphazard manner across the marketing and PR industries. In John Balmer’s 2008 explanation of corporate identity, he discusses how a corporate identity is defined through a number of elements, including: “company ethos, activities, quality, market position, location, geographical scope, organisational type, structure, procedures and culture. Corporate identities are informed by history and will have been shaped by past strategies” (Balmer, 2008, p.888). This is a fairly concept-packed explanation, so let’s break it down. What do all those different terms mean in a corporate context?
Ethos is fairly self-explanatory. It’s the defining set of values that are intended to guide the way the corporation operates. For example, Chevron Editing has a clear Our Ethos page, in which we lay out our ‘Triple C’ ethos, which also serves as our tagline. An example of this in a corporation can be found on Chevron’s website – no, not Chevron Editing, but Chevron Corporation, the oil and gas titan. They explain their ethos in ‘the Chevron Way’, which also includes their vision and how their strategies are informed by this.
Activities relates to what the company actually does. Are they a product- or service-based corporation? What industry are they in? What’s their USP?
Quality refers to, in my opinion, not only the quality of the product/service in the traditional sense, but also the necessity of the product/service. Product/services can generally be broken down into essential, non-essential and luxury categories, and from there further delineated with quality classifications. For example, both Rolex and Audemars Piguet are luxury watch brands, but, arguably, AP is a higher-quality brand.
Market position references the corporation’s position in relation to other entities in the same market. Is the corporation a start-up? A global leader? A growing company that’s just been listed on the NYSE?
Location naturally impacts an identity, particularly when cultural contexts and geographic market positions are taken into account. This also relates to ‘geographical scope’ – that is, what sort of market is the corporation reaching? A good example is Woolworths (one of Australia’s largest retail companies) versus Chevron Corporation. Because of the nature of Woolworths’ offerings, its geographical scope is limited to its store locations, while Chevron Corporation is a goliath multinational with interests around the world.
Although there could be multiple meanings for ‘organisational type’, I assume that in this context, Balmer is referring to structural typologies like hierarchical versus matrix (for example). The layout and structuring of the corporation, as well ownership types (e.g., publicly-traded or privately-held), will influence its identity.
‘Procedures’ is an umbrella term encompassing everything from manufacturing processes to patents to marketing strategies.
Corporate culture is generally influenced by both the corporation’s ethos and managerial style, and is essentially the behaviours practised by employees and executives, both internally and externally.
Branding, Image and Reputation vs. Identity
I don’t want to go into this too much here, but it’s worth pointing out some of the key differences between the four for clarity’s sake. We’ve just gone over what a corporate identity encompasses, so what is corporate branding? Essentially, it’s the corporation’s expression of itself, and manifests in graphic design, copywriting, digital platforms and external communications.
Reputation is an ‘earned’ attribute, and is the “outcome of interactions between stakeholders and the organisation over time” (Abratt and Kleyn, 2012, p. 1050).
Image, unlike reputation, is how the general public perceives the company, and may be inconsistent with reputation, as well as being judged by different criterion. Importantly, none of these are static attributes which have minimal impact on a company – managed properly, they are strategic assets which can help corporations mitigate damage and enhance opportunities.
Five Types of Corporate Identity
As Balmer and Greyser point out, a corporate identity is not a fixed entity, nor does it take a single shape – it is subject to constant change, evolving and reaffirming in relation to its composite elements, as well as having multiple, co-existing forms. They define these forms as the following:
- Actual Identity
- Communicated Identity
- Conceived Identity
- Ideal Identity
- Desired Identity
Actual Identity is the objective present nature of the corporation’s identity, which is composed of the elements we discussed earlier.
Communicated Identity is the identity promoted through marketing and PR, as well as external assets like news media, social media and word-of-mouth.
Conceived Identity, as defined by Balmer and Greyser, is a bracket for corporate image, reputation and branding, and is “the perceptions of the company” (Balmer and Greyser, 2003, p. 17).
Ideal Identity is a fluctuating identity which optimally positions the corporation within its market, and may change based on external factors. Balmer and Greyser cite the nuclear industry post-Chernobyl; a more recent example is the way auto-manufacturers subtly repositioned themselves following Volkswagen Group’s carbon emissions scandal.
Desired Identity is the vision of the company as espoused and held by the corporate leaders. Balmer and Geyser note that Ideal Identity and Desired Identity are often conflated, but the key difference lies in that Ideal Identity is formulated following extensive market research, while Desired Identity is an emotionally-informed executive vision.
Why Does Corporate Identity Matter?
If you’ve read this far, you’re probably wondering, “why does all this matter?” Understanding the multiplicity of corporate identity is important because of the problems that can arise if there is a discrepancy between identities. One of the key tenets of crisis communications management is understanding that a gap between stakeholder expectations and the company’s actions can lead to crises – in this situation, a gap between stakeholders’ perceptions of a company (Conceived Identity) and Actual Identity can cause serious reputational (and, subsequently, financial) problems for a corporation.
As such, it’s essential that companies have proper identity management, a task which should be carried out by PR professionals in conjunction with corporate executives. The Ideal Identity should be constantly researched and evaluated, and, eventually, should affect the Actual Identity. For smaller businesses, the take-away should be that a business identity is something that needs to be carefully considered and managed, preferably (if you have the budget) by a PR practitioner or firm. It’s certainly not something your in-house graphic designer or local marketing agency can or should handle.
If you’re looking to learn about corporate identity in a lot more detail, these are some of the academic works I referenced when writing this article.
- Abratt, R., Kleyn, N. (2012). “Corporate identity, corporate branding and corporate reputations: Reconciliation and integration”, European Journal of Marketing, 46(7/8), 1048-1063.
- Argenti, P. A., & Druckenmiller, B. (2004). Reputation and the corporate brand. Corporate Reputation Review, 6(4), 368-374.
- John M. T. Balmer, S. A. (2003). Revealing the Corporation: Perspectives on Identity, Image, Reputation, Corporate Branding, and Corporate-level Marketing : an Anthology. Psychology Press.
- John M. T. Balmer, & Greyser, S. A. (2006). Corporate marketing: Integrating corporate identity, corporate branding, corporate communications, corporate image and corporate reputation. European Journal of Marketing, 40(7), 730-741.
- John M. T. Balmer. (2008). Identity based views of the corporation: Insights from corporate identity, organisational identity, social identity, visual identity, corporate brand identity and corporate image. European Journal of Marketing, 42(9), 879-906.
- Cees B. M. van Riel, J. M. (1997). Corporate identity: the concept, its measurement and management. European Journal of Marketing, 31(5/6), 340 – 355.