Canadian consumer trust in brands is at an all-time low according to new research from the University of Victoria’s Gustavson School of Business.
That conclusion is based on a two-part survey: the first part was conducted in January and February as part of Gustavson’s annual research, while the second was conducted in April in order to gauge how the pandemic affected consumer sentiment. The first survey showed trust falling from the year before, with the pandemic further eroding trust for certain brands.
Saul Klein, dean of the Gustavson School of Business, attributed the decline during the pandemic to consumers becoming more skeptical about brands, paying closer attention to brand values, and making more thoughtful purchasing decisions. The importance of supply chain was also a contributor to consumer trust.
“Brands that were unable to make products available to customers during the pandemic saw a decline in trust scores,” said Klein in a release. “For example, despite the fact that Lysol and Clorox enjoyed increased demand, they lost trust among consumers due to the scarcity of their products on shelves.”
The Gustavson Brand Trust Index measures trust via five broad criteria:
- Consumer perceptions if a brand is trustworthy and acts with integrity;
- Consumer perceptions on how well a brand performs;
- Consumer perceptions on social responsibility;
- Consumer perceptions on how a brand treats customers;
- The extent to which a person recommends the brand to others.
Brands are scored from a theoretical -100 to +100 points, where a score of -100 would mean total distrust and +100 total trust.
The first survey measured 7,800 Canadian consumer opinions about 342 corporate and product brands across 27 categories.
In that survey, Mountain Equipment Co-op (MEC) and the Canadian Automobile Association tied for top spot with 55 points, followed by Costco (54) and Dyson (51). Home Depot and Sony tied for fifth with 50 points apiece.
In April, 1,050 Canadians were surveyed about 105 brands from the original list. That list changed significantly, with Canada Post on top followed by Shoppers Drug Mart/Pharmaprix, CTV News, Costco, The Weather Network, CBC / Radio Canada News, Interac, VIA Rail, Global News and Cirque du Soleil.
“To complete the fieldwork as quickly as possible, we had to cut down the number of brands evaluated,” said Brand Trust project manager Venus Tamturk. “While all industries have been affected by the COVID-19, we selected the most exposed industries to major upheaval as an immediate result of the pandemic, such as food and drug retailers or household care products.”
The 10 brands at the bottom of the list were: Lyft, Instagram, American Airlines, Airbnb, Uber, Twitter, Sun Newspapers, Snapchat, Craigslist and Facebook.
Other notable findings:
The Gustavson research provided additional evidence that millennial consumers want brands with real-world values and purpose, preferring those that are “proactive in solving long-standing social issues and contribute to making the world a better place.”
“For example, Lush, with its history of donating to progressive groups and advocating for many causes, was the most trusted brand in Canada among ages 18-35.”
In the April survey, Loblaw (+19), Real Canadian Superstores (+15) and Walmart (+13) all saw significant jumps in consumer trust. Aside from being go-to providers of groceries during the pandemic, they were also in the news for giving employees raises—reflecting what Loblaw Companies Limited executive chairman Galen Weston described as their “outstanding and ongoing efforts keeping our stores open.”
“Organizations that demonstrate a good sense of concern for employees’ well-being and empathize with the employees and their experience, build (or recover) and retain trust in their brands (e.g. Loblaw).” However, the large grocery chains have recently been in the news for rescinding their pandemic wage increase.
Amazon saw a 17-point drop from 2019 to 2020, which tied with Agropur for the largest decline of any brand in the study. Even though people were using Amazon more often during the pandemic, its trust scores did not improve. “We may attribute this sharp decrease in its brand trust score to the numerous controversies Amazon has faced, including accusations of monopolistic behaviour and allegations of poor employee treatment/working conditions, which have culminated in employee rallies and concerns over privacy.”
The Gustavson researchers also looked at how big brand stories in 2019 were carried forward into 2020. Gillette saw a spike in brand trust in 2019, following its “toxic masculinity” ad campaign, “particularly in consumer perceptions of it caring about societal wellbeing,” wrote the authors. The effect appears to be short-lived, however, with trust scores falling to 2018 levels. “It is likely that consumers expected more ongoing attention to the topic than they saw demonstrated, and may have interpreted the previous year’s stance as mere lip-service.”
“After cutting benefits and other incentives following the province’s minimum wage hike in Ontario, the iconic brand came under fire for its treatment of employees,” the report stated. In 2018, the brand’s trust ranking dropped from #27 to #203, in 2019 it climbed back up to #136. “In 2020, Tim Hortons’ trust scores went back to almost where they were in 2018.”