My friend and renowned social researcher Mark McCrindle recently released some predictions of the key consumer trends that would define the near future, and this statement was one of them.
I believe that Mark is spot on.
I would suggest that there are 3 concrete and commercial imperatives for becoming a trust-focussed and character-driven brand or organization.
1. Trusted Brands are More Lucrative
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. 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.
In this age of transparency, customers are making increasingly informed decisions. Failing to adjust to this reality could cost companies big time in the years ahead.
In purely financial terms, the business case for purpose-driven, values-based and trust-focussed practices is hard to ignore. Brands that have a clear sense of meaning and social responsibility have outperformed stock market benchmarks by 120% over the last 15 years. According to the Harvard Business Review, over forty academic studies have found a positive correlation between operating with strong social values and financial performance.
The importance of earning trust by having values-based practices is especially important for younger consumers. Research indicates that Millennials are twice as likely as older generations to want their pension funds invested responsibly.
In a recent Morgan Stanley survey, 61% of Millennials reported making at least one sustainable investment decision within the past year and 75% expressed a belief that their investments should make an impact to reverse climate change.
Beyond the world of investments, 60% of Millennials will consider a brand’s reputation and social credibility when choosing who they buy from or work for and a staggering 92% of Millennials believe that business success should not be measured primarily by profit.
Considering Millennials possess 35%-45% of discretionary spending power in our economy and they will be the dominant consumer cohort in the next 5-10 years, these expectations are ones we can’t afford to ignore.
2. Trusted Brands are More Loved
Although gauging the degree to which a brand is loved can seem vague or subjective, it is, in fact, something that is highly quantifiable.
Each year, Harris Insights and Analytics conduct brand perception surveys with over 35,000 consumers around the world and compile the results into what’s known as the Harris Reputation Quotient.
In this research, some of the brands who have consistently topped the list in recent years include Amazon, Patagonia, Procter & Gamble, Microsoft and Samsung. In contrast, we’ve seen many brands tumble down the list in recent years like Google, Boeing, Johnson & Johnson and Volkswagen.
In each of these cases, the decline in customer affinity can be directly related to breaching the confidence and trust of the marketplace. Whether it’s through privacy violations, emission efficiency scandals or fatally flawed jets, each of these brands have paid a heavy price for taking customer trust for granted.
The endlessly quotable Zig Ziglar once said “If people like you, they'll listen to you, but if they trust you, they’ll do business with you.” Going one step further, the love customers feel for brands that earn their trust over time will see them doing business with those brands over and over again. Better yet, they will become advocates and raving fans!
3. Trusted Brands are More Long-Lasting
In an article for the Open Government Partnership, corporate governance expert May Miller-Dawkins said this:
“Companies interested in lasting for the long term understand that maintaining trust translates to stronger brand reputation, a more reliable social license to operate, and an ability to attract and retain talent and capital. Trust is the foundation of long-term business success.”
Miller-Dawkins’ argument is backed up by the research too. Consider the findings of the future brand index in recent years. This index, which identifies brands that are most future-fit and on track for long-lasting success, includes a number of brands that have been around for many years or decades. Brands like Coca Cola, Disney, Nestle and 3M.
These brands have consistently focussed on building a reputation of reliability and trustworthiness which has seen them last the distance. It is likely this reputation will last them for many years to come.
Speaking to his disciple Tzu-Kung in the 492 BC, Confucius famously advised: “Abandon weapons first, then food, but never abandon trust, people cannot get on without trust. Trust is more important than life.”
Regardless of the business or industry you are in, whatever it takes to build or maintain the trust will be worth every ounce of effort. Not only will being trusted see you endure over the long-term and earn more in a financial sense, but it will see you earn the respect, affinity and admiration of those you are looking to serve.
Michael McQueen is a trends forecaster, business strategist and award-winning conference speaker.
He features regularly as a commentator on TV and radio and is a bestselling author of 8 books. To order Michael's latest book "The Case for Character", click here.