Can Your Business Be Trusted? - 96five Family Radio

Can Your Business Be Trusted?

Winning back the trust of consumers is one of the most essential battles businesses of our era could engage in, and it needs to be played on the offensive.

By Michael McQueenWednesday 7 Jul 2021Finance and BusinessReading Time: 5 minutes

More than any other time of history, we have trust issues. As our era has seen so many of the institutions that once stood as societal backbones crumble beneath scandals, lies and alternative facts, the value of trustworthiness has skyrocketed in its scarcity.

Whether in our personal relationships or our interactions with big brands and institutions, trust is the foundation of loyalty, engagement and affinity. This foundation has taken a pounding in recent years – especially during the COVID-19 pandemic.

While this sentiment is obvious to many at a qualitative level, the quantitative figures totally support it. According to the recent Trends in Customer Trust report released by Salesforce Research, 95% of customers are more likely to be loyal to a company they trust while 92% are more likely to purchase additional products and services from trusted businesses.[1] According to research conducted by Harris Insights and Analytics, over half of consumers today will investigate a corporation’s behaviour before buying a product or service from them. More significantly, one third of those reported having decided not to do business with a company because of something they discovered about how the company conducts itself.[2]

Understanding the conditions which have fostered this mistrust is essential to uncovering the necessary responses. There are three clear factors that contribute to the widespread mistrust of our era:

1. Digital economy

In a world of such widespread access to information, it comes as no surprise that individuals are hesitant to trust those in power in business, politics and media. For every claim of truth posed by one article, another is there to counter it, leaving many individuals suspicious of any claim they encounter. It is not only the proliferate information of the internet that discourages trust in consumers, but the implications of the digital age on privacy.

Writing for The Sydney Morning Herald, Tony Featherstone argues that “Trust is oxygen in the digital economy… We provide data to trusted companies and allow them to make money from it because their innovations make our lives easier. We trust those companies to protect our data, use it ethically, build a more personalised relationship with us, and share the gains between the organisation, consumers and the community. We are letting them into our personal life in ways previously unimaginable. Who would have thought we’d let a giant US company track our sleep or an App maker track our kids’ whereabouts on the way to school? Or let search engines analyse our online family photos and other personal data. All of this is fuelled by trust.”[3]

According to Featherstone, building trust in the digital economy is not just necessary for customer engagement, it is the very means by which online companies maintain a “social licence to operate.”

2. Divided environment

Strongly connected to the amount of information available to the everyday individual, the level of division in our society seems unprecedented. We only need to look as far as the pandemic to find that different versions of truth are as numerous as the people claiming them. Misinformation, disinformation and the era of alternative facts have facilitated a society of citizens who simply don’t know what or who to believe.

A compelling article in the Financial Times in January 2019 described a modern challenge facing every organization and leader: “Whether they like it or not, brands and those that lead them are already being dragged into society’s thorniest debates by consumers and employees who find it easier to influence brands than elected officials. Institutional investors are becoming effective environmental campaigners and the concept of the activist chief executive no longer sounds like an oxymoron. With many governments in disrepute, leaders of finance and business have — improbably — been handed an opportunity to lead on some of society’s most pressing issues. Will they take it?”[4]

It’s a good question. Where once business and ideology remained separate, our era has seen them become inextricably tied. In an environment as divided as ours, the market is looking for social, moral and ethical leadership from the brands they engage with. They aren’t looking for brands and leaders that merely comply with the rules but brands and leaders that will step up, speak out and stand firm on the issues that count.

3. Demographic evolution

The rise of Millennials and Gen Zs in the economy further necessitates the building of trust in the market. As those who have come of age in the digital era, the younger generations’ sense of trust has not been encouraged by their environment. According to Forbes, 76% of Gen Zs said they have purchased or would consider purchasing from a brand because they identified with the issues and causes that the brand supported.[5]

Many brands favoured by young consumers such as Warby Parker (glasses), Casper (mattresses) and Joybird (furniture) have built enormously successful retail businesses by understanding what makes Millennials and Gen Z tick. They have actively worked to earn the next generation’s affinity with strong return policies, authentic reviews and social media validation. Better yet, they have demonstrated a commitment to the social values young consumers hold so dear – Warby Parker’s ‘buy a pair, give a pair’ campaign which donates glasses to people in the developing world is a great case-in-point.[6] As the younger generations are only growing larger and more influential in the economy, overlooking the issues that matter them will be detrimental for those businesses looking to build trust.

It is important that support for causes is more than tokenism or ‘virtue signalling.’ Any sense that a brand’s actions are a PR exercise will backfire swiftly. By the same token, being cause-driven must be more than statements and words. In a simple example of a brand taking tangible steps to live out their values, consider an initiative by the Giant supermarket chain in January 2021. With a network of over 160 stores in the Washington DC area, the Giant group have long been passionate advocates for minority business leaders. On a hunch that their customers were similarly committed to this cause, Giant have begun labelling over 3,000 products as being produced by ‘minority owned businesses.’ Giant define the term minority as individuals who are Black, Asian-Indian, Hispanic, LGBT and Asian-Pacific.[7] Businesses must practice what they preach.

Ultimately, in an era dominated by institutions lacking in trustworthiness and consumers even more lacking in trust, businesses have a crucial task on their hands. Winning back the trust of consumers is one of the most essential battles businesses of our era could engage in, and it needs to be played on the offensive.

[1] Glavin, W. 2018, ‘Has The “Public” Lost Trust In Big Tech Companies?’, Equities, 28 November.

[2] 2015, ‘2015 Harris Poll RQ Summary Report’, Harris Poll, February.

[3] Featherstone, T 2018, ‘Why business has a trust problem’, The Sydney Morning Herald, 22 February.

[4] Edgecliffe-Johnson, A. 2019, ‘Beyond The Bottom Line: Should Business Put Purpose Before Profit?’, Financial Times, 4 January.

[5] Stefanini, P. 2020, ‘A Simple Secret To Satisfying Gen Z: Listen’, Forbes, 20 March

[6] Radfar, C. 2017, ‘Autonomous Cars Will Bring A Moveable Feast Of Products And Services’, TechCrunch, 2 July.

[7] 2021, ‘Supermarket adds shelf labels to highlight minority- owned businesses’, Trend Watching, 11 January.

Article supplied with thanks to Michael McQueen.

About the Author: Michael is a trends forecaster, business strategist and award-winning conference speaker.

Feature image: Photo by Mike Petrucci on Unsplash