If consumers don’t trust your brands, you’re in trouble
- Two in three APAC consumers say they will stop purchasing from brands that breach their trust
- Digital experiences outrank in-person for building consumer trust
- Four in ten APAC consumers plan to spend an extra AUD$1,400 per annum with brands they trust
With the digital economy and e-commerce continuing to dictate business decisions for most organizations today, there is still one critical element companies need to be aware of to ensure they can still remain relevant and profitable. And that element is trust.
No matter how much investments are made in technologies to improve the customer experience, a slight failure in ensuring trust to consumers can lead to devastating outcomes. This was highlighted in a recent study by Adobe on more than 5,000 Asia Pacific consumers and 900 senior business leaders.
The study showed that there is a strong correlation between brand trust and consumer behavior. In fact, 66% of APAC consumers say they will stop purchasing from brands that break their trust, while a majority plan to spend at least AUD$700 more each year with trusted brands, including 40% who intend to spend an additional AUD$1,400 or more per annum.
The study also stated several factors that can both increase and decrease consumer trust in brands, as well as enhance the digital experience. Obviously, technology would play a prominent role in this, especially with 72% stating their trust in brands increases when technology is used to personalize their experience, far higher than the global average of 56%. However, 74% also felt that poor personalization erodes trust, with top examples including ‘contacting me in a creepy way’ and sending irrelevant ads or offers.
In Southeast Asia, some businesses have already been found to be taking personalization a bit too far. For example, in e-commerce, sending personalized notifications constantly to a consumer would eventually be considered spam. Instead of getting a consumer, the business may end up losing one if it does not plan out its personalization approach.
Most consumers today, especially the younger ones are definitely in favor of digital experiences compared to just a fraction (23%) of consumers preferring personalized in-person experiences as trust enablers. Interestingly, about half of the felt both are important in building trust.
So how can businesses use technology to build consumer trust?
For Simon Tate, President, Asia Pacific, Adobe, “the importance of digital experiences to a trusted exchange has come into sharper focus, and the stakes are high. Done right, many consumers will reward brands with loyalty and spending. When trust is broken, most consumers will walk away permanently.”
Despite the importance of building trust with consumers, the senior business leaders interviewed by Adobe suggest that earning trust is increasingly tricky, with almost nine in ten (87%) saying that it has become harder since the onset of the pandemic.
“APAC consumers’ experiences over the past two years and the rise of the digital economy are combining to shift the fundamental drivers of brand trust. More than ever, trust relies on brands’ ability to make a positive impact, use data responsibly and deliver digital experiences on customers’ terms,” commented Tate.
Bridging the data trust gap
One of the biggest problems in trust is how businesses make use of their data. Consumers feel that businesses are betraying their trust whenever their data is being used to personalized products for them. Brands’ use of personal data is a key driver of mistrust among APAC consumers. The research revealed that 85% are concerned with how their data is being used, and almost half are ‘very concerned. Only 38% of consumers believe the benefits of providing their data to companies are greater than the risks.
The majority of consumers also say they’ll stop purchasing from brands if they experience data governance failures. This includes 68% who would stop purchasing from a company that used their data without permission and 67% who would do the same if they experienced a data breach.
Despite this clear message from consumers, 95% of APAC leaders believe consumers trust them to keep their data safe and use it responsibly, and 76% say the benefits customers receive from companies collecting their data outweigh the risks.
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