Retail

Trust Becomes Valuable Commodity For Retailers

coronavirus info on door

In normal times consumers look for three things from a retailer: price, product and location. Although there’s no survey to prove it yet, a new factor has likely risen to No. 1 amid the coronavirus crisis: trust. In fact, a pre-crisis PwC report showed that 14 percent of respondents said trust in a brand is the number one reason (other than price) why they shop at a retailer.

With stores closed (for the most part) retailers need to find reliable ways to communicate with their customers. Many online retail brands, especially in the fashion industry, have gone to discounts and promotions to accomplish that. But other brands have had to assume trusted advisor status as they navigate this crisis. CVS and Walgreens, for example, have waived delivery fees for all eligible prescriptions during the coronavirus crisis. Walgreens is reminding customers about services such as Walgreens Pharmacy Chat, which is available 24/7 online and through the Walgreens mobile app, as well as at the pharmacy drive-thru window.

Those two firms, plus Target, are cooperating with the CDC to test for the virus as kits become available. All drug store chains have found themselves on the front lines of distributing information as well as products. Accuracy and transparency have arguably become more important than inventory in this crisis. And brands may actually be a more important source than the media, at least in terms of perception. Only 43 percent of Americans trust the media. According to the most recent Edelman Trust Barometer, consumers who trust a brand will buy the brand’s new products (53 percent versus 25 percent). They will advocate for a brand they trust (51 percent versus 24 percent). And here’s the relevant stat for today’s crisis: “when a brand is trusted on product, customer service and societal impact, the percentage of consumers who will buy first, stay loyal to, advocate for and defend it (68 percent) is 21 points higher than consumers who buy on product trust only (47 percent).”

The case for developing trust is clear. Again, these stats are pre-crisis, but Bazaarvoice recently found that if trust in a brand is lost, 85 percent of consumers will avoid it. Trust is lost by products being poor quality/damaging easily (66 percent), followed by dishonest brand/product information (55 percent), while 43 percent pointed to a brand having fake and fraudulent reviews.

“Fake reviews can be devastating to a brand. Simply put, once shoppers suspect a company of having fake reviews, trust is in question. In an era of misinformation and fake news, brand integrity is essential to building consumer trust, which directly translates to profit,” said Joe Rohrlich CRO at Bazaarvoice. “Brands and retailers need to embrace authenticity and transparency and continuously work to combat fake reviews. Shoppers are hardwired to seek word-of-mouth, and we need to ensure they can confidently turn to ratings and reviews as trusted sources.”

What do consumers want from retailers now? Neilsen, in a new report on retail in China, said consumers need to be reassured. They want information on the supply chain, with complete transparency and they want details of the measures being taken to assure their safety. Neilsen has seen proof in China, as it slowly recovers. There, online food retailers Meituan and Eleme present customers with a “reassurance guarantee slip” that includes details of the body temperature of the cooks, food packagers and couriers for every order, as well as their daily disinfecting routines. It also found that some retailers in China responded to the epidemic by making it an opportunity. They focused on supply chain issues, counseled employees who needed it, adjusted store hours, expanded online, doubled down on social media and strengthened corporate brand marketing to enhance consumer trust.

“Building brand trust isn’t easy,” said PwC. “Understanding individual consumers and consistently meeting their expectations is essential to making it happen. For example, Kroger, a US retailer, uses robust consumer analytics to uncover trends in consumer behavior, allowing it to adjust its offerings and tailor its digital promotions to individual shoppers. And brand trust implies much more than understanding shopping behavior, of course. Trust can [be] earned through transparency regarding sources/suppliers and ingredients, dependability and consistent quality products and services, genuine engagement in community and charity activities, admitting errors and making up for them — the list goes on and on. These trust factors hold not just for established brands but can also be used as guiding principles for newly launching brands.”

Above all, retailers need to be cautious and transparent at a time when clarity is scarce. “In a crisis, it’s hard to find clarity, when the situation and the available information are constantly changing, driven by the exponential logic of contagion,” according to a Harvard Business Review report on Chinese businesses’ response to the coronavirus. “Official advice may be absent, contradictory, out of date, or not granular enough for practical purposes. Furthermore, confusion is compounded by a plethora of media reports with differing perspectives and advice. Employees will need to adopt new ways of working, but they won’t be able to do so unless they have clear, consistent information and overall direction.”

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NEW PYMNTS DATA: HOW WE SHOP – SEPTEMBER 2020 

The How We Shop Report, a PYMNTS collaboration with PayPal, aims to understand how consumers of all ages and incomes are shifting to shopping and paying online in the midst of the COVID-19 pandemic. Our research builds on a series of studies conducted since March, surveying more than 16,000 consumers on how their shopping habits and payments preferences are changing as the crisis continues. This report focuses on our latest survey of 2,163 respondents and examines how their increased appetite for online commerce and digital touchless methods, such as QR codes, contactless cards and digital wallets, is poised to shape the post-pandemic economy.

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