1.03 – Creating Trust Equity

Each year, Edelman conducts a trust survey to gauge consumer trust in business, government, and media. In 2017, their report highlighted a “Trust in Crisis.” By 2022, the theme evolved to “The Cycle of Distrust,” indicating a troubling trend.

Trust in Institutions

Despite the overall decline in trust, businesses are viewed more favorably than other institutions. According to Edelman’s report, 61 percent of consumers trust businesses, compared to 52 percent and 50 percent for government and media, respectively. Concerns about “fake news” contribute significantly to this distrust, especially regarding government and media. Consumers increasingly expect businesses to address societal issues that government either cannot or will not solve. Many expect company CEOs to lead discussions on topics like the economy, technology, wage inequality, climate change, prejudice, discrimination, immigration, and education.

Distrust in Leadership

The 2022 Trust Barometer from Edelman indicates that 63 percent of consumers worry business leaders mislead society with false statements. This concern is even higher for government and media, with 66 percent and 67 percent, respectively. Compounding the challenge, lower-income consumers generally exhibit lower trust levels globally. Alarmingly, 59 percent of respondents from 24 countries consider distrust their default stance.

Building Trust in a Less-Trusting World

Marketers can play a pivotal role in restoring trust and building sustainable customer relationships. Here are some key strategies:

1. Stake Out Your Position

Provide clear, factual information about your brand, products, services, and the values you support.

2. Be Transparent

Transparency about product ingredients, materials, sourcing, manufacturing processes, and charitable donations is crucial. Avoid greenwashing, which can severely damage trust and sales.

3. Own Your Mistakes

Admitting faults and making things right can build credibility. For example, Domino’s admitted to low-quality products and committed to improvement, resulting in a significant revenue increase from 2010 to 2020.

4. Stand for Something Bigger

Communicate your social positions and charitable contributions, and involve customers in your cause. Shared values create strong bonds.

5. Communicate Your Impact

According to Porter Novelli’s Purpose Premium Index for 2021, 73 percent of U.S. consumers support companies that explain their positive impact on communities and the environment.

Competitive Advantage Through Trust

Trust is a significant competitive advantage, more crucial than price, especially in challenging economic times. It goes beyond honesty and integrity, encompassing ESG values and corresponding actions.

Understanding Customer Perception

Knowing how customers perceive your brand is essential. A study by Deloitte and Twilio in 2021 revealed a gap between perceived and actual consumer trust levels:

Interestingly, 68 percent of respondents said they would spend about 25 percent more on products or services from a trusted brand and permit that brand to collect personal data for future marketing.

Key Elements of a Marketing Plan

When developing a marketing plan, consider these critical elements:

Building Relationships Around a Common Purpose

Your greatest competitive advantage lies in your ability to build meaningful and sustainable relationships with customers. These relationships should be based on trust, shared values, personal relevance, and a common purpose.

Choosing a Credible Cause

When identifying your brand purpose, choose a cause related to your business category. This will enhance credibility and success as you bring core competencies to organizations involved in your cause.

Examples of Purpose-Driven Brands

Dove launched the #SpeakBeautiful campaign to boost self-esteem among women.
Starbucks initiated the Ethos Water Fund to provide clean water worldwide.
Savers supports job creation, aid for at-risk children, and assistance for people with disabilities.
Marc Jacobs helps rescue and rehome abandoned dogs in Puerto Rico.

Involving Customers in Charitable Activities

Go beyond merely communicating your charitable activities. Organize community volunteer days that bring employees and customers together. Shared experiences, such as cleaning up a highway or serving meals at a food pantry, forge stronger bonds than sales transactions.

Providing Valuable Information

Brands that offer information to help consumers make wise decisions tend to earn respect, trust, and sales. Ask yourself these questions to develop a purpose that aligns with your customers and other like-minded individuals:

What societal needs can our business model support?
What common goals and ideals do we share with our core customer groups?
How can we align marketing, community relations programs, and brand values with these common goals?
What programs can we execute that bring us together with our customers to support a common cause?
Which community needs related to our business category can we address?
What is the reputation of the retailers that distribute our products, and how might it impact our reputation with customers and communities?

By addressing these questions and strategies, you can build a robust foundation of trust and loyalty with your customers, ensuring long-term success.