‘Brand Love’ Is in the Air!
Romance with privately-owned companies and their brands looks like it’s going from a strength to a strength in most global markets. The same can’t be said of the public’s view of governments, where urgent action is now required to reverse a global ‘trust deficit’ amongst political leaders.
These and other fascinating findings are contained in the 14th Annual Edelman Trust Barometer 2014 that maps trust and other sentiment levels among 33,000 respondents from around the world.
The online survey, the largest of its kind, was conducted towards the end of 2013 and the early part of 2014.
It sampled the views of 27,000 general and 6,000 informed respondents aged between 25 and 64 living in 27 countries who were asked, among other things “how much you trust the institution to do what is right” and were asked to grade that level of trust on a scale of one (lowest level) to nine (highest level). These scores were aggregated to form a global barometer of trust.
The majority of respondents (84 percent) believed business could pursue enlightened self-interest while doing good works for society. Seventy-four percent of all respondents believed that business should be involved in formulating regulation in the energy and food industries.
Researchers say that a lack of leadership and a sense of distrust of politicians to make the necessary changes that benefits society as a whole were some of the key reasons behind this ‘brand love’ sentiment!
Four macro ‘trust factors’ were identified by the research study as having a massive impact on the level of trust within global business:
Industry or sector: Brands in the technology sector were rated as the most trustworthy – followed by automotive, food and beverage and consumer packaged goods brands – as a result of changes in sourcing and management and a stronger focus on higher quality products. Media companies and banks continued to fall down the list of most trusted brands, largely as a result of continued public and regulatory reprimand over ethics, business practices and malfeasance.
Country of origin: Companies and brands that are headquartered in Brazil, Russia, India and China didn’t enjoy the same level of trust compared with global brands based outside of the BRIC nations. Globally, respondents to the survey rated German-based companies the highest, largely as a result of the reputation these brands have for efficiency and productivity, closely followed by Sweden, Switzerland and Canada, all of which have a reputation for having policies that protect employees, communities and the environment. Notably, those companies headquartered within the BRICs tended to suffer a ‘trust discount.’
Enterprise type: Family-owned businesses and SMBs tended to have a higher level of trust compared with public companies or big business globally with the notable exception in Asia Pacific. There respondents trusted global companies and brands more than indigenous companies whose shares weren’t publicly traded on stock markets. State owned-businesses fared the worst as respondents perceived them to lack innovation and transparency compared with private enterprise.
Leadership/CEO: The survey showed a crisis of confidence in the ability of CEOs and business leaders to tell the truth and make moral and ethical decisions that were defendable – just 20 percent of respondents felt they could trust business leaders to do the right thing. Overall, CEOs and business leaders scored “extremely low trust levels on key metrics” say the researchers.
At the World Economic Forum in Davos last month, Edelman presented these findings and reported there was an increasing expectation that the global business community will work for social good and participate in shaping debates over regulation and policy across the world.
In the UK, 56 percent of British respondents felt companies would behave correctly when making moral and ethical decisions and yet just 39 percent of respondents felt CEOs had any credibility for making such decisions.
The ‘trust gap’ between Government and business also appears to be widening, with a 14-point gulf between them. According to Edelman, this provides another opportunity for ‘brand love’ filling the trust vacuum, with businesses and brands taking a much more proactive role in shaping policy, regulation and driving economic recovery in the UK.
In India, global businesses appeared to have a low level of trust compared with home-grown companies.
According to Edelman, just 35 percent of those surveyed felt these multi-national organisations were honest compared with 82 percent feeling able to trust local companies in that market.
“This is a situation that has not improved for five years, spelling problems for exports and global ambitions lauded by their biggest firms,” Edelman reports.
“India is one of the few countries that trusts business the most, which is not only indicative of the success that business has had in terms of creating economic opportunities but also the low expectations that Indians have from the government to make any decisions for socio-economic development.
“The high trust in business implies that there are higher expectations from business now. Our survey indicates that there is still a gap between people’s expectations from and the performance of business.
“People are now looking at business to go beyond focusing on financial returns and enhance performance on parameters such as customer responsiveness, employee welfare, transparent and proactive communication and ethical behaviour.”
The survey revealed that Indians trust business leaders more than government leaders to correct issues within the industry, make ethical and moral decisions, speak the truth and also address societal concerns.
Trust in CEOs (78 percent) and board of directors (76 percent) is more than the trust in government regulators (65 percent). However, while trust in CEOs has increased by only 5 percent since 2013, trust in regulators has increased significantly (11 percent).
Additionally, the survey indicates that the government must play an active role in encouraging and regulating economic activities by promoting infrastructure that supports business, protecting consumers from irresponsible business activities and ensuring responsible activities by companies.
Even though Indian companies are trusted in India, the global charts indicated that Indian companies are the second least trusted globally, only after Mexico.
The emerging markets supplement to the 2013 Trust Barometer also indicated that developed economies such as the United States, United Kingdom, France and Germany have low trust in Indian companies at around 20 to 30 percent and have low trust in Indian companies to make a major investment or to buy a company in their own country.
Businesses and those customers that they serve around the world 24/7 have created an enduring relationship built on ‘brand love’ where advancements that benefit society as a whole can be realised.
“People trust business to innovate, unite and deliver across borders in a way that government can’t. That trust comes with the expectation and responsibility to maintain it. CEO’s must become chief engagement officers in order to educate the public about the economic, societal, political and environmental context in which their business operates,” concludes Edelman.
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