Research by MORI for the Financial Times published last week shows that barely ten per cent of UK consumers believe directors of large companies can be trusted to tell the truth (as opposed to 80 per cent who don’t). It’s just one of a long line of studies proving that “something must be done” about falling levels of trust. The question is, what?
Most suggested remedies focus on a “clean up” campaign: more stringent regulation, and higher and tighter internal standards. But this is just scratching the surface of what is emerging as the mother of all marketing/branding challenges.
A fascinating discussion hosted by Ian Kirk of 1827 Consulting highlighted three very different (but intimately connected) questions associated with this vexed issue of trust: are people more or less trusting nowadays? Are companies and institutions more or less trustworthy? Is the focus of trust shifting as people’s priorities and circumstances change, and if so, where to?
In answer to question one, the decline of deference, the rise of education, the probing critical role of the media, and the emergence of “the truth is out there” Internet suggest that a whole range of forces are combining to make citizens more informed, sceptical and, yes, cynical. That may make our yearning for “somebody to trust” all the greater.
At the same time, the fin-de-siÃ¨cle excesses of various corporate hierarchies has exposed some companies (probably a small minority) to be particularly untrustworthy – just as people’s trust expectations rise and shift to new arenas.
Historically, brands have been built on a very specific, but also very limited, form of contract trust: trust that the product “will do what it says on the tin”. Don’t knock it. It’s helped generate enormous value for both buyer and seller.
But over recent years other trust considerations have grabbed some of the limelight. Take “process trust”, for instance: confidence that over the course of my dealings with you I will be treated fairly and with respect, and that if anything goes wrong I will have some way of remedying the problem. From core regulation through to customer service and customer relationship management, this is a huge area in its own right.
Another such dimension could be termed “shared values trust”. If we have shared beliefs, goals or values, then there’s an awful lot I can take for granted. If I know our beliefs and goals are opposed, however, then I know at some level or another we have a battle on our hands. Environmental responsibility, human rights, community involvement – these are all areas where citizens have begun to widen the trust and performance game.
Then there is motive trust: driven by an understanding of vested interests. It’s no accident that whenever consumers are asked who they trust most to be honest and tell the truth they say “friends and family”. That’s because friends and family have no particular axe to grind; no vested interest in lying. There is a loud warning bell here for companies and brands. It points to a new high ground of brand trust, where what individuals look for is not “do what it says on the tin” trust but “on my side” trust. If I can trust a brand to be my agent or advocate – to act for me and on my behalf (because that is how he earns his keep) – then my relationship with this brand is likely to take precedence over all others.
So if people’s willingness to be trusting is falling, and what it takes for companies to be trustworthy is changing, while consumers’ desire for new levels of trust is rising, where does that leave us? The simple answer: on a steep learning curve.
One aspect of this learning curve is the difference between “active” versus “passive” trust. Traditional brand trust adopts a “shopping” mode: “I’ll witness your behaviour, and then I’ll make a choice.” But increasingly companies – and some consumers- want a higher level of commitment. They desire a determination to work to make the relationship work. It’s yet another angle to the broader shift from one-way communication to interactivity, but it’s important. The higher investment that leads to higher rewards demands higher levels of trust.
Another aspect of this learning curve is the changing role of communication. Branding in the era of “it does what it says on the tin” trust was all about mask management. As long as the mask’s promise was fulfilled, nobody really cared about what went on behind the scenes. When process trust, shared values trust and motive trust move to centre stage however, the essence of good branding turns inside out. It’s now all about transparency. That’s quite some cultural shift. And a massive operational challenge too.
But the implications go even deeper for companies. Philosophers have long agonised about the clash between altruism and selfishness. But the entire edifice of modern commerce is built upon a bridge between the two – created by trust. In particular, the strange mix of reciprocity and self-interest that makes repeated interactions with other people worthwhile.
Companies today live and breathe cash-flow maximisation. We value companies according to a discounted cash-flow calculation: what are future cash flows likely to be? But when we look deeper at how real businesses actually work, we discover that almost invariably these cash flows depend on, and are driven by, something else. Let’s call them “trust flows” – the flows of trust between various stakeholders who decide whether or not they are prepared to invest in, and commit to, that particular relationship.
Successful businesses not only maximise cash flows. They also maximise trust flows (or “brand equity”). If we could somehow calibrate each company’s “discounted trust flows” – to see whether the trust that underpins “relationship productivity” is eroding or building – we would have a much better measure of its real health. How to maximise trust flows, and how to calibrate progress along the way: that’s the emerging challenge highlighted by today’s trust debate.
Alan Mitchell, email@example.com