N Chandramouli
Feb 13, 2013

Opinion: The trust deadlock: Why we need to act, now

N Chandramouli, CEO, Trust Research Advisory, publishers of the annual research The Brand Trust Report – India Study

Opinion: The trust deadlock: Why we need to act, now

In the recently released Brand Trust Report (BTR), India Study - 2013, some findings make some interesting revelations. The study defined a ‘brand’ to be any idea that is transactable, and therefore included a variety of products, services and people which were socially, emotionally and commercially relevant to people.

A brand can be defined by three essential elements - its vision, values and culture. While vision and values are internal to the brand, its culture places the brand in context with its external environment. Context, of course, is everything when comparing one brand to another - the closer the context, the greater the relevance of comparison. Since the best context for brands is usually provided by its category, let us understand mindsets of the influencers in India by an analysis of three diverse but evocative categories: Luxury Cars, Banks and Personalities.

Gaining 20 ranks over last year, BMW not only retains India’s Most Trusted Luxury Car title, but also becomes India’s Most Trusted Car beating last year’s leader, Maruti Suzuki. Audi and Skoda are also ahead of Maruti. Seven of 14 brands in the luxury car list have gained an average of 113 ranks and four new brands make an entry, implying that 79 percent brands in this list have gained significantly.  Three brands which fell in ranks are Mercedes Benz, Lexus and Rolls Royce. Among the 100 Most Trusted brands, there are four Luxury Car brands, two Banks, and only one Personality brand.

Usually when luxury gains trust, it is indicative of market confidence. But when there are sharp positive movements in luxury, it is indicative of a distinctive shift in preference, aspiration and consumption. Luxury is automatically attractive, but when you add Brand Trust to an already high Brand Attraction, the result is high buying propensity. Extended, this increased propensity can be expected to be the indicative pattern for all luxury goods.

On to something more serious, especially since no other category is more susceptible to trust than Banking. In the analysis, 13 out of 23 banks’ trust ranks fall by an average of 220 ranks over 2012. The leader SBI retains its Most Trusted Brand position even though it goes down to 50th rank across categories in India. Two banks make a new entry into the top 1100 list, but at ranks 1090 and 1099 respectively. 

When Banks lose trust, economy suffers as a whole and there is a lack of investment confidence in businesses, weakening the long term business outlook. Among Indian Banks, 11 out of 17 in the list are nationalised banks, traditional organisations with an aversion to change in operational and communication style. For people to gain trust in banks, it is necessary that they break from their paradigm blindness and invest efficiently in communication and operations. If businesses have to feel confident of their investment future, they must feel confidence of getting support from the banking fraternity.

The third category analyzed is human personalities. 35 Personalities are listed in the 1100 Most Trusted Brands list, much more than the number of Luxury Cars or Banks. Of this, nearly half are new entrants this year. The average ranks gained by Personality brands was 222, whereas the average ranks lost was only 123. And the type of Personalities increasingly gaining trust are from Entertainment, Social and Sports, not really from Business. Clearly, it shows a shift of brands showing a preference for trust relationships with humans than with brands.

So here lies a real problem - while consumption propensity is increasing, business investment confidence is not. It is a trust deadlock that will not open up on its own and has to be broken by the collective action of government and industry together. Opportunities will be fulfilled only when brands attempt to understand the dynamic nature of trust and act to change it for the better. 

Source:
Campaign India