Brand power in the age of declining trust
Edelman’s annual Trust Barometer report in 2017 carried a headline “Trust is in crisis around the world”. A KPMG report last year found that “trust has declined in almost every major economy and many developing ones”. In a CNN interview recently, Salesforce’s founder and CEO Marc Benioff argued that “companies that are struggling today are struggling because of a crisis with trust”.
There seems no end to the brands, organisations and leaders that have lost the public’s trust. There has been a royal commission into our banks, multiple questions over Facebook’s use of personal data, cheating cricketers, fake news, church leaders charged, and political parties bickering among themselves.
It is hard to believe that some brands and organisations have turned a blind eye to building trust with customers over the past decade. Trust is the basis of all relationships, gained slowly like drops of rain but lost in buckets. It is fundamental to business, symbolised in a handshake and eye-to-eye contact. It’s easy to understand why the most trusted brands in Australia, according to the Readers Digest, are Band Aid, Dettol, Colgate, Gillette and Dulux. Another survey by Roy Morgan lists Aldi, NRMA, Bendigo Bank, Qantas and Bunnings. These brands meet the “trust” checklist in the KPMG report – standing for something more than profit; demonstrably acting in the customers’ best interest; doing what you say you will; keeping customers informed; and being competent and likeable.
There is no doubt that brand trust is more complex in a digital world, where social media and data personalisation have enabled brands to act as if they are talking to you in person. Combine that with the exponential growth of individuals’ data that can be captured; digital marketplaces; smartphones; voice technology such as Google Home and Alexa; and the algorithms and deep learning of artificial intelligence, and there are far more opportunities to get brand trust wrong. This is especially so when trust is measured at lightning speed and some decisions around brands are being made by machines acting like humans.
Data became the hottest brand trust issue last year. The biggest data breach involved the Marriott International hotel chain and had an impact on up to 383 million people on the Starwood booking database. This included more than five million unencrypted passport numbers. Facebook had multiple issues, the most discussed being Cambridge Analytica’s access to Facebook users’ data. This data was used to persuade voters to change their opinions in the last US presidential election. Consumers started to question the trust they had in these brands: one US survey showed 71 percent of people were worried about how brands collected and used their personal data. They also began losing trust in the smart devices in their homes and 55 percent of people indicated concern that their conversations were monitored. Marketers also had their doubts after YouTube posted ads that appeared alongside offensive videos, leading to a number of companies and their media agencies withdrawing advertising from YouTube for a period.
In the past five years, some of Australia’s biggest companies have rushed to establish or buy into data businesses that can offer insights into the purchasing behaviour of their customers and also use that information to improve their marketing communications. Virgin acquired a data business called Torque, Qantas set up Red Planet, Westpac’s VC Fund bought into Zetaris and Woolworths purchased half of Quantium.
Some companies have commercialised this data by selling it to outside organisations that match it with their customer profiles, adding to the knowledge they have on their customers. Some have questioned the ethics of this, even if it is anonymous; others ask who actually owns the data – the individual or the companies?
Trust around data relies on the fundamentals: common sense says that being a friendly and helpful neighbour is better for a long-term relationship than being annoying or remote. The personal customer data a business holds needs to be treated in the same way. In a business environment where consumers have more choice than ever, as well as more transparency and lower barriers to switching brands, boards, CEOs and marketers cannot ignore the need to invest in brand trust.
This article first appeared in The Australian on 15th February 2019.