How to avoid a customer exodus—rebuilding trust after a data crisis

by | Sep 20, 2018 | Public Relations

Brand and retailer trust is top of mind for consumers, with more than 9 out of 10 saying they consider whether they can trust an organization before they give the company their business. But new research from marketing promotions firm YA and The Institute for Research in Marketing at the University of Minnesota shows that “trust” is not just an intangible comms buzzword—nearly all (96 percent) respondents in the joint survey say there are circumstances where organizations can lose their trust forever, and nearly a third (32 percent) say they have less trust in organizations than they did five years ago.

“In recent years, we’ve heard tale after tale of trust issues between consumers and companies,” said YA president and CEO Chris Behrens, in a news release. “It’s incumbent for organizations to work day in and day out to build a culture of trust with employees, partners and customers, and to be transparent and honest when issues do arise.”

The survey also found that 60 percent of respondents say their personal information had been compromised as a result of a security breach affecting a business, and two-thirds say it is unlikely they would return to the business where the breach occurred.

“In today’s large, complicated businesses, there are countless ways organizations could potentially lose consumers’ trust,” said Steve Goodyear, director for the Institute for Research in Marketing, in a news release. “There are clear right and wrong ways to handle these situations, with the worst action being no action at all.”

The top action organizations can take to re-earn consumer trust is for management to be transparent, admit there is an issue and announce steps to regain trust

Another top way to work to regain trust, according to the survey, is to create a clear mission and values in the organization to ensure employees are working ethically and living those values every day, not just in times of crisis.

“Think of gaining and keeping trust as a marathon, not a sprint,” said Behrens. “Smart organizations regularly assess their business processes to ensure employees are rewarded for behaving in a trustworthy, ethical way.”

When asked about their own work environment, 65 percent of respondents say at some point they had a boss or co-worker who was doing something unethical, and nearly half (48 percent) say that they have worked for an organization that had practices in place that were unethical.

More than half of respondents (57 percent) say that if they saw unethical behavior in the workplace, they would tell their supervisor.

“This is a classic case of ‘see something, say something,’” said Goodyear. “If organizations can curb unethical behavior before it spreads, they’ll have a much greater chance of protecting their brand and the consumers they serve.”

The survey of 145 consumers took place in August 2018.

Survey results:

Are there circumstances where you would never regain trust in an organization? Can they lose you forever?

  • Yes—96 percent
  • No—4 percent

Has your personal information ever been compromised as part of a security breach affecting a business (e.g. a retailer)?

  • Yes—60 percent
  • No—40 percent

How likely would you be to return to a business if your personal information was compromised in their system?

  • Very likely—4 percent
  • Somewhat likely—30 percent
  • Somewhat unlikely—43 percent
  • Very unlikely—23 percent

When deciding whether to do business with an organization, how often do you consider if it can be trusted?

  • All of the time—48 percent
  • Some of the time—47 percent
  • It really doesn’t enter my mind—7 percent

What organizational characteristics/actions most create trust among customers and others?

  • Reputation of management as trustworthy—9 percent
  • Mission and vision that articulate the importance of trust/ethics—9 percent
  • Actions that reinforce the importance of trust (e.g. their partners)—62 percent
  • Proactive communications that lead to better understanding—20 percent

What is the top action organizations can take to re-earn customer trust if it has been eroded?

  • Offer free product/services to affected customers—5 percent
  • Management is transparent, admits there is an issue and announces steps to regain trust—73 percent
  • Fire those responsible for breaches of trust—5 percent
  • Create clear mission/ values in the organization to ensure employees are all working ethically, live those values every day, not just in times of crisis—17 percent

Have you ever felt that you had a boss or co-worker who was doing something unethical?

  • Yes—65 percent
  • No—35 percent

Have you ever worked for an organization that had practices in place you felt were unethical?

  • Yes—48 percent
  • No—52 percent

If you noticed unethical behavior in the workplace what would you do?

  • I wouldn’t want to get in trouble—3 percent
  • Tell my supervisor—57 percent
  • Give information through an anonymous tip line—32 percent
  • Quit my job—8 percent

Compared to 5 years ago, what is your level of trust in organizations with which you do business?

  • Much more trust—8 percent
  • A bit more trust—11 percent
  • About the same—49 percent
  • A bit less trust—28 percent ß
  • Much less trust—4 percent

Compared to 5 years ago, do you think there are actually more issues in business that erode trust or do you think it’s that more issues are now being made public?

  • I think there are more issues that erode trust today—30 percent
  • I think there are the same amount of issues, but more are being made public today—68 percent
  • I think there are fewer issues that erode trust today—2 percent

What is the top reason you would choose to do business with one company over another?

  • Price—8 percent
  • Quality—43 percent
  • Customer service—28 percent
  • They are trustworthy and ethical—22 percent

Richard Carufel
Richard Carufel is editor of Bulldog Reporter and the Daily ’Dog, one of the web’s leading sources of PR and marketing communications news and opinions. He has been reporting on the PR and communications industry for over 17 years, and has interviewed hundreds of journalists and PR industry leaders. Reach him at richard.carufel@bulldogreporter.com; @BulldogReporter


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