Maintaining your customers' trust in your brand is critically important

Island Farms owners moved quickly to warn of milk issue, other firms not so worried about image

June 29, 2017 - I was enjoying my cup of Irish breakfast tea (no sugar, plenty of milk) one morning when I remembered the news about recently recalled milk. I quickly scoured the paper for the article about a recall of Natrel and Island Farms milk, due to the presence of unspecified “foreign material,” the vagueness of which sent my imagination into overdrive.

At the bottom was a table showing the UPC codes of suspect milk. Squinting at the table, the milk carton and back again, I assured myself that my family was not in danger and I could continue to consume my tea in safety. I relaxed, buttered my toast and read about the dysfunctional culture at Uber.

That such a list was quickly released to the media says quite a bit about modern branding. We are fortunate to live in a time and place in which the products we buy can generally be relied on not to harm us. When there is a risk, smart businesses – like Agropur, the owner of the Natrel and Island Farms brands – move quickly to protect the brand. They do this because they know that consumers’ trust is fundamental, and fragile.

Research in branding shows that brands have “personalities.” We make friends with them, fall in and out of love with them, and attribute qualities to them. A brand can be sincere, exciting, sophisticated, competent. It can be like your grandmother, your favourite uncle or your worst enemy. And, importantly, it can be trustworthy. Or not.

At the Gustavson School of Business at the University of Victoria, we conduct an annual survey of consumers’ trust in brands. We ask a sample of more than 6,000 consumers across Canada to rate their trust in just under 300 brands, on overall brand trust, functional trust (how the brands live up to their promises), relationship trust (how they treat customers) and values-based trust (how they treat employees, communities and the environment).

This way of thinking about trust is unique to Gustavson: we are firm believers in the principle of responsible management, that business owes something not just to shareholders and consumers, but to communities and society, as well. So we also ask about how likely our respondents are to recommend a brand to others, to see if there’s a link between brand trust and word-of-mouth recommendations.

There is. This year’s survey, conducted in March of this year, again supported our belief in the three components of brand trust, and in the trust-recommendation link. So Agropur was not just being a good corporate citizen: in recalling its milk, it was acting in its own self-interest. Agropur, by the way, was one of the top brands in the index, so the company knew it had something worth protecting.

Uber’s management, meanwhile, seemed to have a tin ear when it came to protecting trust in its brand. As The Economist put it recently, Uber’s workplace was more reminiscent of a bar than a business. Plagued by scandals over sexism, discrimination and bullying, founder and CEO Travis Kalanick was forced out by the board – who, mindful of their investment, could see how customers, employees and investors were abandoning a company that behaved in ways they abhorred. Values-based trust in action, I thought.

It’s not over for Agropur. In the wake of the recall, stories began to emerge about consumers getting sick after drinking milk, and the RCMP opened an investigation into product tampering. Having taken rapid action, Agropur has wisely stayed out of the limelight and has not challenged some of the more dubious claims. However, you can bet your morning cereal that the company will jump in wherever it can to protect brand trust.

David Dunne, Ph.D.
Professor and Director, Full- and Part-Time MBA Programs

Originally published in the Vancouver Sun