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A Vision of Tomorrow, Where Money Isn’t Everything

A Vision of Tomorrow, Where Money Isn’t Everything

mallen-bakerA fascinating blog article from CSR maven Mallen Baker caught my eye last week.  I’ve been chewing away on it ever since.

In Time To Redefine Ethical Investment he strikes directly at the root of what’s widely seen as the flaw in today’s business operations: responsibility.

Not the responsibility of managers and executives: the responsibility of investors.  Not socially responsible investment, but responsible company ownership.

In among everything else we’ve lost the fact companies are owned by their shareholders.  It’s not just an issue of finance; it’s an issue of management and governance as well.  Investors are owners.

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3 out of 4 Brands Could Disappear and Most People Wouldn’t Care

businessman holding globeIs your brand meaningful? Marketing and communications company Havas Media Group has been indexing brands based on a framework that connects human well-being with brands at a business level for years, and in 2013, most brands add little meaning to people’s lives.

The Meaningful Brand Index is used to measure the benefit brands bring to people’s lives and ranks over 700 brands among 134,000 consumers in 23 countries using 12 “areas of well-being.” Those areas include health, financial, relationships, community, happiness, and more. After intensive analysis, each brand is ranked based on the effect it has on quality of life for consumers.

The 2013 list is topped by the following 12 brands:

  1. Google
  2. Samsung
  3. Microsoft
  4. Nestle
  5. Sony
  6. IKEA
  7. Dove
  8. Nike
  9. Walmart
  10. DANONE
  11. Philips
  12. P&G

Interestingly, the majority of brands in the top 10 are technology brands. The top 10 sectors ranked overall are: retail, food and beverage, IT and consumer electronics, travel and tourism, consumer goods, media, public transport, auto, oil and energy/utilities, telecom, and finance and insurance.

The rankings only tell a small part of the story though. Havas Media Group shared a number of key learnings from its analysis in a press release:

  • Brands in the Meaningful Brands Index beat the stock market by 120%.
  • People believe that just 20% of worldwide brands meaningfully affect their lives in positive ways.
  • Most people around the world would not care if 73% of brands disappeared tomorrow. In Europe and the United States, the percentage is higher at 92% of brands, but it’s 58% in Latin America and just 49% in Asia.
  • People are attached six times more to brands in Latin America and Asia than in western markets.
  • Globally, 32% of people believe that brands communicate honestly. The number drops to 21% in Western Europe and 26% in the United States but rises to 36% in Latin America and 56% in Asia.
  • Only 36% of Americans believe that brands work hard to improve quality of life for consumers. The number is even lower (29%) in Western Europe.

In the press release, Amy du Pon, Global Head of Data Insights for Havas Media Group, explained why it’s so important to develop meaningful brands in 2013, saying, “Relying on incremental marketing dollars alone is not sustainable. The opportunity today is for us to reinvigorate our brands, the role they play, and the human value they realize.”

Consumer trust in brands has been falling steadily, and the Havas Media Group study confirmed that loss of trust, born of unmet expectations, is leading to brand indifference in the West. Every company should prioritize building brand trust by delivering on expectations consistently. That’s a basic rule of branding, but it’s also a rule that is easily forgotten.

Do consumers trust your brand? Is it meaningful? Leave a comment below and share your thoughts.

Image: Jakub Krechowicz via stock.xchng

Consumer Perceptions of Online Privacy Practices Affect 9 out of 10 Brand Purchase Decisions

online purchaseJust how important is it for brands to ensure consumers have positive perceptions of a company’s efforts to keep their private data secure? For 91% of internet users in the United Kingdom, online privacy policies directly affect their decisions to do business with a company. That statistic comes from a study by Accenture from August of 2012, and it tells just a small part of the story.

On Monday, eMarketer reported that 46% of respondents to a 2013 survey by Ipsos MORI and TRUSTe said that they “strongly avoided” doing business with companies that they thought didn’t do a good enough job of protecting their privacy and personal information online. Add an additional 45% who “had a tendency to avoid” doing business with these companies, and you end up with a meager 9% of the sample U.K. internet user audience who claim that online privacy concerns do not affect their online purchasing decisions or behaviors.

This data reinforces the idea that marketers must prioritize building brand trust with consumers. As I wrote in one of my articles for Corporate Eye last week, building brand trust is the number one factor that can motivate consumers to share personal information with your company, which can then be used in future brand marketing campaigns. This finding comes from the 2012 Data Tracking Study from DMA (follow the preceding link to read the details and see the infographic), which reported that consumers are more willing to share private information when they trust the company (47%), the company has a clear privacy policy (43%), or the company provides an essential service (31%).

Bottom-line, now is the time to revamp your online privacy policy and consumer-facing communications related to your company privacy practices. Don’t assume that consumers know your brand, and therefore, trust your company to protect their private information. They expect companies to protect their information, but they don’t typically perceive that companies do enough to keep their personal information safe.

The Ipsos MORI and TRUSTe study found that nearly half of internet users in Great Britain do not trust most companies with their personal information online. When asked if “most companies can be trusted with personal data online,” internet users responded as follows:

  • Strongly agree = 6%
  • Tend to agree = 51%
  • Tend to disagree = 33%
  • Strongly disagree = 10%

These numbers are quite terrible from a brand perspective considering that one of the most important aspects of brand building is developing brand trust. Brand marketers need to aggressively work to change the consumer perception that company online privacy practices are not adequate. This requires both education and proof. In other words, companies need to live up to the privacy expectations that consumers have.

Can your company prove that its online privacy practices sufficiently protect consumers’ personal information?

Image: Pierre Amerlynck

How and When UK Consumers Will Share Private Data with Brands [Infographic]

private data online securityIn the 2012 Data Tracking study published by DMA (sponsored by Equifax) last week, 1193 UK adults shared their opinions about when and how they’ll share personal information with brands. The good news for brands is that the number of consumers who claim to be willing to share private data with brands has sky-rocketed over the past 18 months.

Specifically, the number of people who are willing to share personal data with brands that are “selling products they might consider buying” increased by 48% during the past 18 months. Furthermore, the number of people who are willing to share personal information with brands that are “selling products they have to buy” has jumped from 56% to 63% in the past 18 months. Another significant increase was found in the number of people who are willing to provide their name, address, and email address (referred to as “basic information”) to brands, which  grew by 63% in the past 18 months.

However, not all brands fare as well when it comes to convincing consumers to share personal data. Brands that offer clear security policies and follow best practices to secure consumer trust are having much more success in obtaining consumer private data than brands that don’t prioritize these activities.

You can follow the link above to view the full report and see some highlights in the infographic below. Key findings include:

  • Consumers are most willing to share personal information with brands they already have a relationship with (76%) and when they’re buying products (63%).
  • Consumers are more willing to share private information when they trust the company (47%), the company has a clear privacy policy (43%), or the company provides an essential service (31%).
  • Sales incentives mentioned in the study that are most effective in motivating people to share personal information include free samples (25%), money-off vouchers (25%), discounts (23%), free shipping (20%), and competitions (19%).
  • On average, consumers are most likely to share their name, followed by their email address and their mailing address in that order.
  • Of the activities included in the survey, consumers reported that they are most likely to shared  basic personal information like name, email, and address when they’re buying goods online (79% average), and least likely to share this information when they’re pledging support for a cause.

dma data tracking study 2012 infographic

Brand trust is a critical component of any brand-building strategy, and the results of this study show that building brand trust is the number one factor that can motivate consumers to share personal information with your company that can be used in future brand marketing campaigns. If you’re not already prioritizing your efforts to build brand trust, you need to do so now.

Image: Ayhan Yildiz

Social Media Advertising Trusted Less than Engagement

computer-keyboard-handsResults from a new poll by Harris Interactive for the Online Publishers Association (OPA) shouldn’t be too surprising for marketers and brand managers who have been involved with social media marketing in recent years.

According to the study, consumers trust ads on social media sites less than ads on other websites.  In fact, only 8% of respondents felt that companies that placed ads on social media sites are reputable.  That’s significantly lower than the 21% of respondents who felt that advertisers on traditional content sites are reputable.  Respondents also felt that advertisers on social media sites are less respected and the ads displayed on social media sites are not relevant.

When asked how satisfied they are with various social media sites, the results were somewhat surprising with Wikipedia, a site known for inaccuracies from user-submitted content, ranked quite high.  Of course, perhaps respondents have expectations for Wikipedia, accept the possible inaccuracy of information found there, and rated the site with that in mind.  Check out the results below:

  • 77% of respondents were satisfied with Wikipedia
  • 73% of respondents were satisfied with YouTube
  • 64% of respondents were satisfied with Facebook
  • 63% of respondents were satisfied with MySpace

The reality is that brands need to engage with consumers on social media sites in a manner that meets users’ expectations for the site and for the brand.  Social sites aren’t going away and even if users aren’t completely satisfied with existing social media sites and tools, they’re going to keep using them until something better comes along.  Until then, engaging with consumers, earning their trust, and building relationships with them on social sites continues to be more effective than advertising on the same sites and continues to present an opportunity that brands shouldn’t ignore.

You can follow the link to read more about building brand trust.

Image: stock.xchng

Consumers Rank Ford as Most Improved Brand in 2009

Brandindex-chartAccording to a BrandIndex poll, which based results on over 1.2 million online interviews throughout 2009, consumers voted Ford as the ‘most improved’ brand of the year.  Based on those results, I guess it’s not surprising that Ford saw a 33% increase in sales in December, and Ford’s 2009 market share grew by 1% over 2008.

One of the reasons consumers might have a positive view of the Ford brand could be attributed to the company’s refusal to take money from the U.S. government’s TARP (Troubled Asset Relief Program) in 2009.  Furthermore, the company made some overt attempts to adjust its product line to meet consumer needs rather than focusing on the ‘easy money’ sales automobile manufacturers had come to rely on in the 21st century.

Facebook ranked number two in the BrandIndex list of the most improved brands of 2009, and two more Ford-owned brands, Lincoln and Mercury, took the third and fourth spots.  The top 10 most improved brands are shown in the image above.

BrandIndex also provides an annual consumer ranking of the ‘healthiest’ brands, which are defined as the brands that consumers perceive to be the strongest.  Not surprisingly, brands like Google, Johnson & Johnson, M&M’s, Campbell’s, and other brands that people have learned to trust over the years ranked high in this list.

I’ve written about the importance of building brand trust here on Corporate Eye before, and the BrandIndex ranking supports that line of thinking.  Without a doubt, consumers are looking for brands that offer transparency and trustworthiness in 2010 and the foreseeable future.  At a time when consumer perceptions are easily shaped by the speed of social media conversations, brand managers have to work harder than ever to set, meet and exceed consumer expectations through every marketing touch point.

Consider Ford’s ranking on the BrandIndex list of the most improved brands of 2009.  It’s unlikely anyone would have predicted that ranking a year ago.  However, by setting consumer expectations (not taking the TARP money), meeting consumer expectations (revising the Ford product line), and exceeding expectations (let’s face it, expectations were low a year ago so Ford had a lot of opportunity to exceed them), word spread among consumers both through word-of-mouth marketing and social media conversations, and consumers began to see the brand as being more transparent and trustworthy than some of its competitors.

Take a look at your own business, consumers and competitors.  Knowing that consumers want transparency and trustworthiness from the brands they choose, how can you capitalize on opportunities where you competitors are not delivering on those needs and create the perception that you can deliver on those needs.

Source: BrandWeek