Currently Trust in institutions, corporations, and industry is at low ebb.
The low general level of trust means trust is applied not in a general way, but on a case by case basis (e.g. product by product and brand by brand). In this context, slips can have a disproportionately broad impact and be less readily forgiven by a bruised public. For example: consumption of all milk in China went down 50% even though only powdered milk was implicated; Consumption of milk chocolate in Europe decreased when some contaminated milk was found in a couple of European candy bars; dioxin in Buffalo milk mozzarella forced an immediate 50% decrease in Neapolitan mozzarella consumption, and a further decrease on the purchase of all mozzarella from Italy.
A long string of very public trust failures has increasingly demonstrated that the systems set in place to protect society’s interests, are themselves not trustworthy: the Savings & Loan crisis suggesting poor regulation and oversight; then Enron/Arthur Andersen which suggested that the broader system was untrustworthy, not just individual companies; now our current financial crisis is demonstrating complicity throughout the “trust” chain – including auditors, ratings agencies and government. In fact government failure to keep watch and protect its citizenry culminated in Iceland going bankrupt and in the rest of us bailing out the very banks that lost our money, and even poorly run but very large companies.
Now Edelman’s trust survey shows that trust in Government, Business and Media is low and falling. The most trusted ‘institution’ is NGOs globally: “54% of 25-to-64-year-olds trust them to do what is right”.
What does this do to your Brand?
Brands and brand values depend upon people identifying with them- such identification being fully dependent upon trust. Lose that, and you’ve wasted your brand building. This is no insignificant – Robert Goizueta famously said that if all of his factories burnt down one night, the ‘goodwill’ he had built up around the Coca-Cola brand would ensure that investors would provide the cash for him to rebuild at once.
Consumers depend on trust to decide where and which products to buy. When trust in business is diminishing (62% trust business less this year than last) consumers need to find other ways to (re)establish trust. But that is a daunting exercise (where do you get the information? how can you trust it? and for how many transactions…), so consumers need short-hand to provide trust.
Enter the arbiters of trust: the NGOs.
A Power Shift
As noted above, the NGOs are believed to stand for the right thing. Interestingly, they are not expected to solve the problem – just alert people to the problem. So the power of the stamp of approval comes from NGOs. And the requirement to act, on you.
At the same time, NGOs are facing a difficult financial time: as consumers hold back on spending, NGOs are receiving less money then they need to meet their own agendas. And consequently they need to fight hard for relevance. So they need brands: either as a friend, or as a target.
The consequence - you can expect more NGO campaigns: NGOs have a strong drive to question trustworthiness of corporate claims and to campaign rather than engage.
This is the powershift: the general environment has led to a general sense of distrust, and the NGOs need little to focus distrust on products and companies. They have a very strong hand.
What to do? Engage with the NGOs you are most afraid of so that you gain trust through association adn perhaps even the stamp of approval. And do so with neutral facilitators to help manage the engagement. Everybody at the table is feeling at risk, so the situation is delicate and the stakes surprisingly high.
To engage effectively, you must be able to persuade the NGOs to take you seriously. And therefore you must be ready to:
- send senior people to the discussions
- commit to action(s)
- commit to transparency (at a minimum with the NGO)
- commit to goals and measures
In return, you need to request that they:
- not campaign against you or your general product line while working together
- that they not have a campaign against somebody else whose product’s could be readily confused in the public eye, with yours
- and that they be themselves trustworthy partners, and partners that work to keep other NGOs off your back.
In this way, you can make a virtue out of necessity – “even in this difficult economic climate we determined to partner with the NGO community to improve …. “.
Nietzsche may have summarised the problem best: “I’m not upset that you lied to me, I’m upset that from now on I can’t believe you.” Far better to build trust and maintain it, than lose it and seek to rebuild. The public’s willingness to re-trust has worn thin.
Contact us – we’ll help you find the NGO partner(s) to work with to ensure that you and your brand are not only protected, but the favorite for years to come.
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