Miles Toolin: Marketing leaders unpack ‘seismic shift’ in consumer trust

By Miles Toolin, senior solutions consultant, Cheetah Digital

 

Aussie consumers have low levels of trust for advertising, but will pay more to purchase from a trusted brand, a new report from Cheetah Digital reveals.

So what can marketers do to keep up with this seismic shift in consumer expectations where hyper-personalised relationships with brands are the only way forward? This question – and more – was unpacked in a recent Cheetah Digital-hosted webinar I was a part of, alongside an expert panel of guests, including: Teresa Sperti, Founder and Director, Arktic Fox and Adam Posner, CEO and Founder, The Point of Loyalty.

Social media’s erosion of trust

According to Cheetah Digital’s new Digital Consumer Trends Index, 67% of consumers in Australia do not trust the advertising they see on social media platforms. And more than half (63%) don’t trust social media platforms with their data.

Teresa Sperti, Founder and Director at Arktic Fox doesn’t find the results surprising at all. “Over time, there has been an erosion in the level of trust for social platforms,” she points out. “As a whole, this has led consumers to be increasingly wary about the information they provide on these platforms and how their data is being utilised.”

She credits this erosion of trust to a couple of things. First, consumers are concerned about the social impact these platforms have on society; and secondly, consumers are worried about the approach that’s taken to harvest their data.

A recent Washington Post poll finds that, of all the large tech companies, social platforms like Facebook and Tiktok have the lowest level of consumer trust. In fact, 72% of Internet users rated their level of trust in Facebook as “not much” or “not at all” to responsibly handle their personal information and data on their Internet activity. And roughly six in 10 distrust TikTok and Instagram, while slight majorities distrust WhatsApp and YouTube. This decline in trust mirrors Cheetah Digital’s findings to a T.

“From a data privacy point of view, consumers’ expectations are changing broadly,” Teresa adds. “Consumers are less trusting of brands when it comes to providing data. They don’t believe brands can be trusted to protect personal data or utilise it effectively. As a result, we’re seeing a wave of greater skepticism from consumers as a whole.”

Adam Posner, CEO and Founder at The Point of Loyalty, agrees, pointing out the disruptive aspect of social ads. “The ads interrupt and are, oftentimes, irrelevant. But even more, they’re invasive. That aspect of social ads feels creepy, which works to erode consumer trust as well,” he says.

It’s ironic when you consider that social platforms emerged as a way to drive engagement with the audience. Since it’s moved into a sphere of profit over people, they’ve moved further from their reason for existence.

“These days, it’s all about monetisation of the platforms. As they’ve increased the amount of advertising, consumers have become bombarded with all kinds of messages,” Teresa says. “It’s become hard for consumers to decipher what’s ‘fake news’, if a product is quality or if they’re potentially being taken for a ride.”

Adam brings up the idea that, on these platforms, the consumer is essentially the product. “It’s a real awakening,” he says. “Consumers are realising that if they’re the product through their data, then that means they’re valuable. So, naturally, they’ve become even more protective over their data.”

It seems what that’s creating is a data economy as a consumer. We’re going to see a shift to a value exchange where the platform says give me your data, and I’ll give you something to make it worth your while. That’s when social platforms will start regaining consumer trust.

Teresa adds, “Customer expectation is changing. The brands that are going to win moving ahead are those that have earned the right to effectively communicate, earned the right to be entrusted with data and are able to retain the right to utilise that data. And a lot of that comes back to control and consent.”

Meanwhile, Cheetah Digital’s report also shows that email still reigns supreme when it comes to driving sales, beating paid social and display advertising by up to 228%. “The statistics don’t lie. We’ve gone back to the future of marketing, in a sense. In light of all the creepy advertising, marketers are going back to the basics of building a brand. And that’s putting the spotlight back on email.

Email continues to be a trusted channel. At least 90% of consumer brands have emails and it’s widely accepted. So it’s a great foundation and super effective for marketers.

Loyalty drives relationship marketing

The findings in Cheetah Digital’s report signal a new era of relationship marketing. 63% of consumers are willing to pay more to purchase from a trusted brand. Almost half (40%) of consumers in Australia are more likely to take part in loyalty programs compared to last year. And 24% of consumers left their favourite brand because they didn’t feel valued as a customer.

Relationship marketing, to me, is personalisation on a deep one-to-one level. It’s really about understanding your consumer, listening and building a relationship with them. It’s marketing to them the things they actually care about. Because that’s what relationship marketing is all about, caring about each other.

“There are many layers to relationship marketing,” Adam adds. “And a lot of it is contextual. Some customers might want a transactional relationship with one brand and a more personalised relationship with another. But all customers want acknowledgement and appreciation.”

In today’s competitive landscape, brands are finding it increasingly challenging to maintain loyalty and build strong relationships, Teresa says. Even more, many marketing teams are pushed to do more with the same resources. It’s the perfect storm, keeping their relationship marketing strategies stagnant and transactional.

“Many are still very transactional and predominantly focused on delivering business outcomes rather than providing real value to the customer,” Teresa points out.

“Value exchange is so important. Yet it still feels like much of the activity that brands are driving to market is about what they want the customer to do and what outcomes they’re looking to achieve as opposed to truly understanding what it is that the customer wants.

“You have to go out and talk to them. As brands, we’re still not very good at listening to our customers. It’s really hard to do relationship marketing when we don’t understand our customers intimately.”

A brand that is hitting it out of the park when it comes to relationship marketing, Teresa says, is Starbucks. “Starbucks invested early in understanding the customer and driving loyalty. It knows that in an ever-changing landscape, its customers want convenience and frictionless experiences. The experiences that Starbucks has developed deliver true value to its customers.”

 

Access the webinar free and on-demand here.