Goodwill is in short everything that can be associated with your company. Everything from reputation to logo and slogan. But how do you influence this and how do you benefit from the concept?

Text: Anna Storm | Foto: Shutterstock

The term “goodwill” is used in business economics to value the company’s good reputation. Satisfied customers generate goodwill in several different ways, usually by returning, shopping for more goods and passing on the company’s good name to friends, which in turn leads to more customers. A satisfied customer is happy to tell his friends and acquaintances about his positive experience. The same applies if the customer is not satisfied, this is called badwill as opposed to goodwill.

What is goodwill?

Goodwill can be everything that customers associate the company with. It can be, for example, the company name, the company logo, an advertising slogan, the company’s reputation, website or perhaps the staff and customer base. If you have a website where customers can tell about their positive experiences, this leads to goodwill and added value. New visitors go to the website and see positive comments; this in turn means that they will probably visit the store themselves.

If you are active on the website and social media, this can also generate goodwill. By updating and inspiring, you continue to attract customers to the store. You do not make direct money on goodwill, but it generates business and a good reputation, which ultimately leads to increased value for the company.

Goodwill is thus counted as an abstract value, ie a value that is not directly converted into money. In other words, you can not sell your goodwill, but on the other hand you can value it very highly.

Product placement

Om ditt företag har en bra goodwill kommer detta påverka hur kunden uppfattar er. Om butiken har ett gott rykte kommer betraktaren se allt med positiva ögon. Därför kan er logo eller er slogan fungera som positiv produktplacering. Om kunden har hört talas om er butik och hört goda rykten kring er går han/hon runt med en positiv känsla i kroppen. Kanske kommer hon/han inte besöka er enbart för det goda ryktets skull, men skulle ert namn/logo/slogan dyka upp i olika mediala sammanhang (annons, reportage) kommer kunden bli påmind om det goda ryktet och troligtvis gå till handling och besöka butiken. På så sätt fungerar goodwill som produktplacering och hjälper till att locka folk till butiken.

Goodwill in branding

When the company or business offers a brand with a special reputation and a certain status in the market, this is valued at a higher or lower value. A well-known brand has higher goodwill than an unknown brand. In short, goodwill is a fixed asset – something that has a value in the company for a long period of time. You can value your goodwill according to the difference between the company’s book value and the total value of the company. The total value is what the company would be worth at the time of sale.

Finally: Goodwill is worth its weight in gold, goodwill is your satisfied customers, make sure there are more and increase the value of your business.