Site last Updated: Oct 23 2007 4:46PM
You are not currently logged in. Click here to Login/Register
Oct 16, 2007
Unisys study reveals what erodes consumer trust

Article Tools
Save & Share


Consumer trust can be easily damaged if businesses fail to be ethical in the way they do business, lack innovation or lose focus on customer satisfaction, says a new European study from Unisys.

To earn consumer trust, companies must instead focus on how they treat their customers and employees, while demonstrating strong leadership and investing in local communities. More than half of European consumers surveyed cited these "softer" and less quantifiable attributes as those factors that build the most trust in the organisations with which they do business. While important in the boardroom, factors such as shareholder value, market share and profitability held little interest for these consumers.

From the list of 28 attributes that consumers had to rate as key in building or eroding their trust, there are certain factors that people do not put at the top of their trust-building list but that would factor highly in eroding their trust. For example, consumers do not place as much emphasis on a company’s ethical business practices (40%), customer satisfaction (47%), and innovative products or services (39%) in building trust with an organisation, suggesting that they have now come to expect these attributes in day-to-day business.

However, their trust can be severely eroded when these baseline requirements are not met, with potentially dramatic consequences for business. For example, a massive 63% of European consumers would be concerned about buying a product or service if a company was unethical; 56% would lose trust with bad customer service, and 59% would react negatively to outdated products and services.

These and other findings are from the Unisys Trusted Enterprise study, which measured the importance, impact and influence of trust, privacy and security among 3669 consumers across eight European countries. The Ponemon Institute, a privacy research organisation, conducted the study.

"This research illustrates the business importance of winning consumer trust and the perils of undervaluing it," says Rene Head, head of enterprise security in continental Europe, Unisys. "The message here for European business is that it should absolutely maintain its commitment to product quality and service delivery, but increase its focus on the more intangible attributes that really make their customers tick - whether that is investing more heavily in local services or treating itsstaff well. These issues are at the forefront of consumer hearts, minds - and purse strings."

"Trust is an intangible asset that is often overlooked until it is too late," says Larry Ponemon, chairman and founder of the Ponemon Institute. "Many organisations invest heavily to increase their market share and profitability but, as this research reveals, if these organisations want to instil trust among their customers, they may be focused on the wrong factors, or ignoring the right ones altogether."

Of 30 industries surveyed, consumers viewed retail banks as one of the most trusted industries across Europe, with the exception of Sweden, where the government is regarded as the most trusted. At the other end of the scale, the telecommunications and airlines industries fell into the least trusted category in France, Holland, Sweden and Italy. Both of these least-trusted industries face the challenges associated with high consumer expectations, so if things go wrong, consumer trust can erode very quickly.

However, just because consumers trust banks more than telecommunications providers, does not mean that they trust them absolutely. Indeed the majority of consumers - 68% across Europe - expressed their willingness to jump to a competitor if it offered better security or protection for their personal information. What is more, 71% would not want to pay more for better security - they would expect it to be a core component of doing business today.




Rate this article




Post a comment on this article
 


Business Directory
Top Articles
Print Edition
Interview: Diffie talks about encryption, modern spies
Joyce Carpenter, Computerworld (US) - Whitfield Diffie, a co-inventor of public-key encryption, is chief security officer at Sun Microsystems, and co-author, with Susan Landau, of: ‘Privacy on the Line: The Politics of Wiretapping and Encryption’ (The MIT Press, 2007).
‘Consumerisation of IT’ - CIOs and IT leaders urged to prepare
‘Consumerisation of IT’ was the theme at this year’s Gartner symposium, which was held in Cape Town last month.
Open source given a ‘thumbs up’
Sibonelo Mkhwanazi - Mark Shuttleworth says the correct adoption of open source will yield positive returns not only for SA, but for the rest of the continent, since our country is the gateway to Africa’s economic development.
Microsoft 'silently' restores root certs users ax
Paul McNamara, Network World (US) - Kill off any one of 230 root certificates available under the default configuration of Windows XP Service Pack 2 and the operating system will "silently" revive it, and restore the certificate to the trusted status that the user intended to be revoked. And in Windows Vista you just cannot kill them, period.
Attackers continue to phish for trouble
Christo van Staden, director at Carrick Holdings -   Reports issued by international IT security service and technology vendors confirm a marked increase in specific security risks, such as phishing and spam.
Instructor-led training is the icing on the cake
CBT has its place in life. In fact, I know plenty of courseware developers and instructional designers who make a living from CBTs – and that is all great and good.
Firefox vulnerable to protocol-handling bug attacks
Gregg Keizer, Computerworld (US online) - Firefox remains vulnerable to attacks exploiting protocol-handling bugs, even though it was patched twice in July, say a pair of security researchers.