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Trajectory of Trust in American Business Shows Signs of Improvement if Brands Act Decisively

Submitted by: GolinHarris International

Categories: Corporate Governance

Posted: Apr 16, 2003 – 12:00 AM EST

 

New Golin/Harris and InsightExpress research reveals Americans are willing to trust business again if companies prove they can be a “trust-builder” not a “trust buster”

Apr. 16 /CSRwire/ - · 37% of Americans think business is heading in the right direction in rebuilding trust, even though 40% still say they trust business less today than they did a year ago

· 46% -- nearly half of Americans – now believe CEOs are doing the right things to restore trust, up 8% from August 2002

· 39% say they would start or increase their business with a company specifically because of trust, while 53% say they would stop, reduce or switch their business to a competitor because they have concerns about a company’s trust

· 53% believe business has learned its lesson, will behave differently, and will be more trustworthy in the future

· 83% agree that they are more likely to give a company they trust the benefit of the doubt and listen to their side of the story before making a judgment about corporate behavior

CHICAGO, IL – The crisis of trust in American business is at a turning point. According to new study by Golin/Harris International and InsightExpress, American companies that become positive, proactive trust-builders will be greeted enthusiastically by consumers, who will in turn reward these trusted companies with active preference, loyalty and increased patronage.

“Last year, the story was the scandal, how American businesses undermined public trust and confidence. This year, the story is the solution, how American businesses is recognizing the power of trust as an asset for driving growth, profitability and competitive differentiation in an ever changing and challenging marketplace,” observes Rich Jernstedt, CEO of Golin/Harris. “Our new insights into the trajectory of trust in American business show that investments in their “trust bank” pay real dividends at the bottom line.”


State of Trust Still Bad, But Signs Point to Potential for Getting Better

The most revealing insight from Golin/Harris’ ongoing tracking of trust in American business is the growing willingness of consumers who believe business can be trusted again – but only if business demonstrates trust in deeds, not words. A year ago, Golin/Harris’ survey discovered that American business was in a free-fall, with 70% of Americans stating that they just didn’t know whom to trust anymore.

The new research suggests that nearly 37% of Americans applaud American business for starting to turn the situation around and head in the right direction on rebuilding trust, while only 17% believe that business is still headed in the wrong direction. This is reinforced by the belief of more than half of Americans (53%) that business has learned its lessons, is changing its behavior, and will be more trustworthy in the future.

“InsightExpress constantly tracks consumer attitudes towards business, which is an important factor in corporate decision-making in these uncertain economic times,” notes Lee Smith, president of InsightExpress. “Trust is the bedrock of customer relationships, and as we’ve seen in past InsightExpress surveys, the crisis of trust has shaken the foundation of business. I find it very encouraging that while the trust situation still is not good, it shows signs of improving at a time when business needs it the most – to position themselves for economic recovery through the balance of the year.”

CEOs Slowly Starting to Regain Trust

CEOs, who have been the lightning rod for the crisis of trust, also are slowly starting to regain consumer confidence in their leadership on trust. Today, 46% of Americans say that CEOs are doing the right things to restore trust, up 8% from August 2002.

Jernstedt points out that “CEOs are the ambassadors of the brand, the ones who set the tone and direction for trust in the brand by customers, investors, employees, marketplace partners and the communities in which the company does business. While corporate leadership still has a long way to go in restoring trust, the research makes one thing crystal clear: Americans expect CEOs to take the lead, make a meaningful commitment to trust-building, be accountable -- and deliver on the promise of trust through corporate behavior.”

Statistics Show Trust Can Build or Bust a Brand

Equally important, companies investing in trust will reap its rewards, for the data reveals that trust can build – or bust – a brand. 39% of consumers said they definitely or probably would start doing business with a company or increase their business specifically because the company is trustworthy. An even larger number – 53% – said they would definitely or probably stop, reduce or switch their business to a competitor if they have doubts about a company’s trustworthiness. Moreover, an overwhelming 8 out of every 10 Americans will give a company they trust the benefit of the doubt and listen to their side of the story before making judgments about questions of corporate behavior.


“For trust to last the lifetime of a brand, trust must be constantly infused into the lifeblood of the brand. Building and sustaining trust requires an ongoing commitment,” explains Ellen Ryan Mardiks, Golin/Harris’ Chief Marketing Officer. “The essence of the Trust Bank theory is a brand that consistently works to build trust as part of its core values and everyday business practices. Smart companies will amass trust assets that can be called upon to protect the brand in tough times. Without these deposits in its Trust Bank, a single breach of trust can devastate a company because you have no track record of trust-enhancing behavior to call upon. That’s the lesson American business has learned the hard way this past year.”

About the Trust in American Business Research

The study is the latest chapter in Golin/Harris’ ongoing research on trust in business and is part of the company’s more than 40-year commitment to helping clients build trusted brands worldwide. The survey of 300 American consumers over age 18 was created, distributed and tabulated through InsightExpress, a professional online research firm, during a 24-hour period at the end of March 2003. The data has a tolerance of +/- 5%.

About Golin/Harris

Founded in 1956, Golin/Harris International is a full service public relations firm, providing professional counsel and strategic communications programs to clients through 34 offices around the globe. Golin/Harris clients include McDonald’s Corporation, Samsung, the Lowe’s Companies, Nintendo of America Inc., Texas Instruments, Sprint Corp., Visa USA and the William Wrigley Jr. Co. Golin/Harris International is headquartered in Chicago. It is part of the Interpublic Group of Companies. (NYSE: IPG - News).

About InsightExpress

InsightExpress is the acknowledged pioneer of rapid turnaround, high-quality, online market research services. With its award-winning and patented technology, market research expertise, and access to more than 100 million online individuals, InsightExpress enables its clients to easily harness market research to make the right business decision in real-time. InsightExpress is affiliated with the Interpublic Group (NYSE: IPG - News), NFO WorldGroup, and General Atlantic Partners. Visit us on the Web at www.insightexpress.com or call 203-359-4174.

For a copy of the new Trust in American Business research, please contact: Mark Rozeen, Golin/Harris, (212) 309-0658, mrozeen@golinharris.com.

For more information, please contact:

Mark Rozeen Golin/Harris International
Phone: +1-212-309-0658
Doug Adams InsightExpress
Phone: +1-203-978-2304

 

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