Be Authentic, and Trust Will Follow

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In March 2018, Judith Kasiama called out Mountain Equipment Co-op (MEC) and the outdoor industry on social media for lack of diversity in its advertising. What happened next was remarkable, and an object lesson in brand trust.


At UVic’s Gustavson School of Business, we’ve been measuring Canadians’ trust in brands for five years now. Our Gustavson Brand Trust Index ranks over 300 brands each year, based on a sample of over 6,000 consumers. We break Brand Trust into three types: Functional Trust, Relationship Trust, and Values-Based Trust. We also measure consumers’ likelihood of recommending the brand to others.

Functional Trust is the “baseline”: does the brand do what it promises? Is it good value for money? Relationship Trust is the next level: how well does it look after customers? We all expect these things of the brands we buy, and a brand that fails on these two dimensions won’t be trusted.

MEC does well on both of these, as do many other brands. What distinguishes MEC is its Values-Based Trust.

We’ve found that there’s more to brand trust than value for money, or how the brand treats its customers. Today’s customers want more: they want brands to represent them, to espouse the values they believe in. That’s Values-Based Trust: whether a brand looks after the environment and communities. And MEC excels in this area.

In the years we’ve been conducting the survey, we’ve seen how easily brands can lose overall trust when they are seen to betray Values-Based Trust. Last year, Tim Hortons slashed its workers’ benefits and breaks; as a result of the ensuing media explosion, the iconic Canadian brand fell dramatically in our rankings, from 27th in 2017 to 203rd in 2018; this year, it has barely recovered, to rank at an insipid 142nd. In 2015, Volkswagen was found to have cheated on diesel emissions tests; VW’s brand trust remains on the skids, at 305th out of 314 brands in the index.

Not MEC. The outdoor equipment and clothing retailer ranked #1 for Values-Based Trust, with a score far higher than any other brand. MEC also ranked high on the more traditional trust measures, and as a result was #1 for overall Brand Trust. This is not new: MEC consistently ranks among the top trusted brands every year.

What is it about MEC that makes it the most trusted brand in Canada, and the one that best aligns with customers’ values? Could other brands learn something from it? By studying MEC, could they develop a marketing strategy to gain trust, recommendations and ultimately sales? Perhaps this is the wrong starting point.

Two other brands vie for top spot each year: the Canadian Automobile Association (#2 in this year’s index) and Costco (#3). Like MEC, these two brands are member-owned cooperatives. Their customers are not traditional “customers”, as much as participants with a real stake in the brand.

Member-ownership is all about authenticity: the MEC brand is not there to line the pockets of powerful shareholders, but for the folks who shop there, loyally and regularly. That’s why they trust MEC: they know they are an integral part of the brand’s future and have a voice in its strategy.

By March 17, MEC reached out directly to Kasiama. After learning about MEC’s commitment to changing its practices, Kasiama signed on as a MEC Outdoor Nation Ambassador. Later that year, MEC’s CEO, David Labistour, issued an open letter acknowledging that MEC had not represented the diversity of Canadians, and vowing to change. There was no shifting of blame, no PR spin: MEC had done wrong, and was determined to do right.

Labistour clearly knew what was at stake. Brand trust comes from authenticity. Anything else is just trustwashing – using trust as a marketing strategy – and customers will see through it.

David Dunne, PhD

Professor; Director MBA Programs, Gustavson School of Business

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Traditionally, focusing on an organization’s higher purpose has been the purview of social enterprises and non-profit organizations, or seen as an element of corporate social responsibility with limited impact on business practices. More recently, however, we have seen a paradigm shift in the way customers and employees assign their loyalties to organizations, putting organizational purpose front and center as a business driver, and placing attention on the notion of “brand trust”.

The days of trying to cajole consumers, or even mislead them, are long gone. In the context of an emerging values-based economy, consumers pay close attention to what a company stands for, and how it goes to market matters. Customers choose to abandon or place their trust in a brand based on the extent to which it acts responsibly and stays true to its values.  Companies realize that nothing says longevity as much as trust.  So, the question becomes, how do businesses build and retain trust in their brands?

At the Gustavson School of Business, we conduct an annual survey to assess consumer trust across more than 300 different brands and what leads consumers to recommend a brand to their friends and family. The team behind the study assesses “brand trust” overall as well as three core dimensions of trust: functional trust, relationship trust, and values-based trust. Analysis of the Gustavson Brand Trust Index (GBTI) 2019 results, based on the opinions of over 7200 Canadians, revealed that besides the functional performance of a brand (quality, reliability, value for money) and the way it relates to its customers, consumers also pay close attention to a brand’s values and its commitment to social responsibility.

Beyond the long-term positive impact of building trust, there can also be an immediate benefit for brands taking a strong stance on social issues. One example may be found in Gillette’s recent hard-hitting “The Best Men Can Be” ad campaign, which challenged overt masculinity, addressed bullying and sexism, and responded to the #MeToo movement. On the back of that campaign, Gillette witnessed an increase in its values-based trust score, and perception that it cares about the wellbeing of society.

No organization is perfect and mistakes happen. Those organizations who welcome feedback and use it to both fix an issue and empathize with the consumer and their experience, engender greater consumer trust and loyalty. This conclusion is evidenced by MEC leading this year’s GBTI ranking, despite taking consumer criticism over the lack of diversity in their advertisements. MEC’s adept response to the concerns allowed them to edge into the top spot in this year’s ranking and becoming Canada’s most trusted brand. The MEC experience demonstrates that it is critical to respond to consumers with honest and authentic communications, followed by a plan of action, when faced with criticism. Trust, when correctly placed, is what makes all the difference. It is no coincidence that the top three most trusted brands overall in 2019 also received the highest relationship trust scores; measuring how a brand interacts with its customers. 

For an organization to be trusted and seen as credible in playing a positive role in society, it must ensure the quality and competitiveness of its product and customer experience. As a case in point, Tesla Motors, carrying high hopes for a sustainable future, enjoyed a great deal of goodwill from consumers for several years, rating highly in the GBTI. As reports surfaced of disappointing Model 3 production numbers, Elon Musk’s verbal miscues, and teething troubles with driverless cars, the company dropped to 32nd overall on brand trust, in 2018. While the electric automaker still ranked as the most innovative and the most eco-friendly brand in 2019, the downward trend continued this year and Tesla slipped to 12th in the automotive category and 136th overall. Canadian consumers closely link brand trust with consumer advocacy and Tesla also lags badly in terms of word-of-mouth recommendations, falling 163rd overall in 2019.

If ever there was an opportunity for brands to define a real social purpose, it is now. Consumer concerns with corporate misbehavior, worries about climate change and falling trust in key institutions make the time ripe for companies to stand out.

Every year, the GBTI provides new insights into consumer behavior and interactions with brands. It measures how the corporate world is adapting to change and earning and keeping the trust of consumers. One finding keeps coming back stronger each year; the importance of having a higher purpose that is infused into every level of an organization and communicated competently and authentically. Such values-driven organizations are attracting customers as well as investors and a broader pool of talent.

Saul Klein, PhD

Dean of the Gustavson School of Business

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Customers looking for value-based trust in the business they interact with

Now more than ever it is important for companies to establish trust with their customers. Trust in a product or a brand is the foundation that creates loyalty and that builds a brand for years to come.

Trust is linked to the values that a company expresses and the actions that it pursues in terms of playing a positive role in society. Mission- or purpose-driven organizations understand that they must move beyond simply providing good products and services to making a more substantive contribution to our collective wellbeing. Such businesses are stepping up to the plate and demonstrating socially responsible behaviours through the pursuit of the sustainable development goals.

Created by the UN, the sustainable development goals are a “universal call to action to end poverty, protect the planet and ensure that all people enjoy peace and prosperity.” The17 goals build upon the success of the Millennium Development Goals, while including new areas that recognize the changes occurring in the world around us, such as climate change and economic inequality.

While the goals were established to help our planet and people, companies that are spearheading initiatives in pursuit of the goals are able to both increase consumer trust in their brands while simultaneously helping the communities they serve; i.e., they can do well by doing good.

Nike is a prime example of this approach. While looking to boost their sales to $50 bilion by 2020 they have also committed to a number of sustainable development goals. For instance, they have committed to sourcing 100% of products from contract factories that meet the company’s definition of being sustainable. They also plan to achieve 100% usage of renewable energy at Nike-owned and operated facilities by 2025.

Nike isn’t the only ones either. AirBnB is helping refugee relief workers with places to stay. Unilever is moving towards getting rid of one-time use plastics, and TripAdvisor is partnering with GlobalGiving to identify and support locally-driven nonprofits with sustainable development focused missions – just to name a few.

More and more companies are doing their best to demonstrate to customers that they are socially responsible and care about more than just the bottom line. Companies that commit to the sustainable development goals are showing themselves to be corporate leaders and as a result are increasingly building consumer trust in their brands.

The Gustavson School of Business is intimately aware of the importance of brand trust, which is why each year we survey more than 7,000 Canadians to see the level of trust they hold with over 300 different brands. The Gustavson Brand Trust Index (GBTI) measures the relationship between social equity, trust, and advocacy for brands in Canada. Now in its fifth year the GBTI, whose results will be unveiled on May 1, continues to highlight the role trust plays in the minds of consumers when making purchasing decisions. While the performance of a brand and the functionality of the product are very important, consumers are increasingly demanding that brands be socially responsible and demonstrate values that align with their own.

We too, at the Gustavson School, have put a stake in the ground in the interest of making a positive change for the planet and society, by fully offsetting our carbon emissions, the bulk of which derive from student and faculty travel. We call on all organizations to join us in taking such voluntary actions to establish themselves as leaders in the fight to mitigate climate change, as well as in pursuit of the sustainable development goals.

To connect with consumers who are increasingly concerned about serious social and environmental challenges, now is the time for corporations to help consumers realize their aspirations for a more purposeful life.


Saul Klein, PhD
Dean of the Gustavson School of Business

About the Gustavson Brand Trust Index:
The Peter B. Gustavson School of Business at the University of Victoria conducts an annual survey to assess consumer trust across more than 300 different brands and what leads consumers to recommend a brand to their friends and family. Besides the functional performance of a brand (quality, reliability, value for money) and the way it relates to its customers, consumers also pay close attention to a brand’s values and its commitment to social responsibility. For more information on the Gustavson Brand Trust Index, please visit https://www.uvic.ca/gustavson/brandtrust/.

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While trust in our key institutions has eroded badly over the past few years, people have higher expectations of business than they had in the past. They believe that businesses can, and should, play a positive role in society, focusing on a broader purpose, while making profits.

This sentiment was expressed frequently at this year’s World Economic Forum in Davos In January. In the words of the CEO of Unilever, consumers want to know how brands are “making society and the planet a little better”

Responsible investing is also gaining traction as investors are putting their money toward companies that show a high level of corporate social responsibility. In his annual letter to CEOs the head of Blackrock, a large investment company, opined last month, “Purpose is not the sole pursuit of profits but the animating force for achieving them. Profits are in no way inconsistent with purpose.”

Today’s customers and employees alike assign their loyalties to organizations that contribute to making the world a better place and to improving people’s lives. Businesses, in turn, are responding and embracing the concept of “profit with purpose.” What was once seen as the purview of social enterprises and non-profit organizations is becoming the mantra for businesses of all types.

While a myriad of functional and emotional motivators drive our purchasing decisions, we also expect businesses to be proactive in solving longstanding societal issues, ranging from gender- and income-inequality to access to clean water.

At the Gustavson School of Business, we are firm believers in the principle of responsible management — the idea that businesses benefit from being accountable to communities and society, as well as to investors. To understand Canadians’ perceptions of trust in over 300 different brands, and how those perceptions are shifting, we conduct an annual survey. We measure the beliefs that brands deliver on their promises of reliability, quality and good value, that they communicate with us fairly and treat us well as customers, and that they play a positive role in society.

Every year, the Index provides new insights into consumer behaviour and interactions with brands. The results of the most recent Index highlighted that besides the functional performance of a brand (quality, reliability, value for money) and the way it relates to its customers, consumers also pay close attention to a brand’s values and its social responsibility. In other words, consumers embrace brands that reflect the values they hold high and they shun those that fall short. Brands such as MEC that translate individual feedback into tangible improvements consistently earn our trust. On the other hand, brands that violate our trust through active malfeasance or a lack of transparency remain mired at the bottom of our rankings. The key indicator of a business’s success is not what it takes from society, but what it gives back.

The good news is that more and more organizations are recognizing that the revenue-generating side of a business and the socially responsible side are inextricably linked. Many brands have started to leverage the power of innovation as it relates to both product and social impact.

For instance, U.S. waste recycling firm TerraCycle recently announced a waste-free shopping platform called Loop, as a way to address the large volumes of plastic waste that is being dumped into our oceans. Eight of the 10 companies that Greenpeace has listed as the world’s largest contributors to the plastic waste crisis are to run a pilot Loop scheme, aimed at reducing the use of disposable containers.

Brands that confront our anxieties and address them in honest and authentic ways will forge more meaningful relationships and earn the loyalty of consumers. With the emerging trend for investors to buy into companies that deliver positive social change alongside financial returns, it will be interesting to see which businesses embrace the concept of profit with purpose.

 

Saul Klein, PhD
Dean of the Gustavson School of Business at the University of Victoria

About the Gustavson Brand Trust Index:
The Peter B. Gustavson School of Business at the University of Victoria conducts an annual survey to assess consumer trust across more than 300 different brands and what leads consumers to recommend a brand to their friends and family. Besides the functional performance of a brand (quality, reliability, value for money) and the way it relates to its customers, consumers also pay close attention to a brand’s values and its commitment to social responsibility. For more information on the Gustavson Brand Trust Index, please visit https://www.uvic.ca/gustavson/brandtrust/.

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Delivering positive social change alongside financial returns has become the mantra for businesses of all types over the past few years. While taking a particular stand on social or political issues will be rewarded by some consumers, it will inevitably alienate others. Companies have responded to this dilemma in the past by avoiding contentious issues. That is no longer possible and consumers and employees alike expect their companies to take a stand on issues that are important to them, rather than standing behind social causes that are generally anodyne. In other cases, it is impossible to avoid taking a stand, resulting in the “damned if you do, damned if you don’t” problem.

In an era of free and open communications, exacerbated by social media, whether truthful or not, people have the ability to rapidly express, coordinate and mobilize around their views. Consumers want to use their purchasing power for positive change, buying or boycotting brands based on their perceived societal impact. 

Cineplex Canada’s decision to screen the controversial anti-abortion film, Unplanned, resulted in some people boycotting the company. A decision not to screen the film would have provoked organized opposition from other people. Although it is too early for Cineplex to evaluate the net impact of its decision, the example highlights the need for brands to take a deliberate stand that is aligned with its core values rather than prevaricate.

Another example may be found in Gillette’s recent provocative ad campaign, which challenged overt masculinity, addressed bullying and sexism, and responded to the #MeToo movement. Our latest Brand Trust study revealed that Gillette saw an increase in its values-based trust score and perception that it cares about the wellbeing of society. Interestingly, however, the positive effect was pronounced among women, while the effect on men was mildly negative

While brands today have the opportunity to build trust in many different ways, there are just as many ways to lose it. Trust can be restored in some cases when there has been an accident or mistake (e.g. Samsung’s recovery from its combustible phone fiasco). Once trust has been compromised through deliberate malfeasance, however, it is very difficult for a brand to fully recover (e.g. Volkswagen’s inability to bounce back from its emissions cheating scandal). A decision that reflects an organization’s values will usually be seen as deliberate.

Even purpose-led campaigns may spark backlash or be seen as an example of “trust-washing” as consumers’ BS detectors are fine-tuned. In the case of Gillette, for instance, if the brand does not keep its promises by taking action that makes a real difference, its provocative ad campaign may be perceived as disingenuous or opportunistic, which would hurt the brand’s reputation in the long run.

Through their purchase decisions, consumers are looking to satisfy both their immediate functional needs and their need to identify with the values and beliefs of a brand. In the polarized world that we live in, consumers empowered by social media are increasingly taking sides and expecting brands and their leaders to do the same. The era of the mass market has come to an end and brands must choose which consumers they want to serve, and then ensure that their positions are aligned with those of their chosen target market, even if this means catering to ever-smaller segments.

Brands have to respond to the divisive political and social climate around us while staying true to their values. As risky as this can be, brand activism is often cheered on by consumers when they believe the brand is authentic and putting action behind its words. A good example is Nike’s controversial ad campaign featuring football player Colin Kaepernick who famously took a knee during the U.S. national anthem to protest against racial injustice. The tagline, “Believe in something. Even if it means sacrificing everything,” shows how a brand can harness the energy of controversy and societal divisions to spark and drive consumer engagement.

Starbucks and Airbnb are other cases in point, having taken a stance in the midst of the refugee controversy in the U.S.. Starbucks committed to hiring 10,000 refugees in five years. Airbnb offered free housing to refugees, students and green card holders who were stranded in American airports due to President Donald Trump’s executive order.

Gone are the days when brands could get away with taking a neutral stance on contemporary social and political issues. In an untrusting and polarized era, brands that address our anxieties in honest and authentic ways will earn the loyalty of consumers. It is no longer enough for brands to simply link to societal issues that are generally safe. They must weigh in on controversial societal issues before they become flashpoints. Taking a position will alienate some people, but not taking a position could alienate everyone.

Saul Klein, PhD

Dean of the Gustavson School of Business

About the Gustavson Brand Trust Index:

The Peter B. Gustavson School of Business at the University of Victoria conducts an annual survey to assess consumer trust across more than 300 different brands and what leads consumers to recommend a brand to their friends and family. Besides the functional performance of a brand (quality, reliability, value for money) and the way it relates to its customers, consumers also pay close attention to a brand’s values and its commitment to social responsibility. For more information on the Gustavson Brand Trust Index, please visit https://www.uvic.ca/gustavson/brandtrust/.

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The event, which takes place at the ExCel, London from 7th-10th February, is expected to attract in excess of 5,000 delegates, 3,500 of which are affiliates, making it the biggest in its history.

The University of Victoria and Global Affairs Canada wrapped up the inaugural Victoria Forum this past weekend. Our aspirations were high — to tackle some of the most intimidating and inter-connected problems facing our world today, ranging from climate justice to trade and development, from developing a nation-to-nation dialogue with Indigenous peoples to global migration, from trade and development to philanthropy, from smart cities to impact investing.

Underlying all of these issues are questions of diversity and inclusion. The former is a reality, the latter is a function of the actions we take, and the ones that we cannot afford not to take.

With more than 75 nationally and internationally recognized speakers and more than 200 other attendees, our goal was to create an open and inclusive space where individuals and organizations from a wide spectrum of backgrounds and perspectives could come together to discuss ideas about diversity and inclusion in the 21st century. We wanted to break down the silos and encourage different perspectives.

We engaged in powerful dialogues with Indigenous, government and business leaders exploring their ideas together with students and academics. From the energy and feedback, it was obvious that such discussions happen rarely and our goal is to ensure that they occur more often.

What did we learn? It was evident from the outset that people feel passionately about the issues and feel a moral obligation to make the world a better place. What became clear over the course of the forum, moreover, was that there are very practical reasons why we need to build a more inclusive society and that the risks of not doing so are high. The future of our planet and our society is bleak if we sit back and do nothing.

The numbers are compelling — Canada is aging, our Indigenous population is growing, the labour force is shrinking, disparities are increasing, and the number of immigrants is on the rise. By 2030, it is estimated that more than 30 per cent of the Canadian population could be from a visible minority group. This rate may climb to 60 per cent in Vancouver and Toronto.

As Assembly of First Nations National Chief Perry Bellegarde reminded us, when First Nations statistics are applied to the United Nations Human Development Index, the living conditions of First Nations people in Canada are ranked as 63rd in the world while living conditions for Canadians overall are ranked as sixth. This disparity is shocking and appalling, and represents an incredible waste of talent and opportunity.

Throughout the three days of the forum, we heard often that to ensure Canada’s continued success at home and abroad, we need to evolve from a “short-term shareholder” model to a “long-term stakeholder” paradigm. We need to resolve the tensions facing business between “doing well” and “doing good.” And we need to build a society based on shared values, while we embrace the things that make us different. Core values of respect, fairness and trust are important foundations to build upon.

The Victoria Forum aims to continue charting a way forward and nurturing these ideas for a better world — built on a robust civil society and strong partnerships.

We launched what we hope will be an ongoing movement, responding to an urgent call for action to take charge of the legacy we are leaving future generations. We encourage everyone to review our discussions at victoriaforum.ca/2021 and help us chart a path forward to a brighter future for all.

Saul Klein is chair of the Victoria Forum and dean of the Gustavson School of Business at the University of Victoria. The Victoria Forum was co-hosted by the University of Victoria and Global Affairs Canada, in partnership with the Canadian International Council, the Conference Board of Canada, the Global Centre for Pluralism, the Haida Enterprise Corporation, Philanthropic Foundations Canada, the Pierre Elliott Trudeau Foundation and the World Wildlife Fund Canada.

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