The new trust economy

How to assess trust in order for it to be created, captured and monetised.

The new trust economy: a framework for trust

Numerous breaches of trust by corporates in Australia and globally over the last year
have soured relationships with consumers, suppressed investor confidence, and
sharpened the pencils of regulators. Our purpose is not to revisit these transgressions,
but to provide answers and examples of how to assess trust in order for it to be created, captured and monetised.

2017 and the first part of 2018 brought a volume of useful consumer research showing that, across all channels, trust is a business asset. For example, PwC’s 2018 Global Consumer Insights Survey: Whom do consumers really trustfound that:

  1. ‘Trust in the brand’ is the second most cited reason why shoppers shop at a particular retailer. The top reason is ‘they usually have the items I want in stock’.
  2. In the digital environment, when asked how they reduce online security risk, the top reasons shoppers give are ‘I only use credible and legitimate sites’ and ‘I choose providers I trust when making payments’.
    Additionally, PwC’s study shows that, according to our customers, the onus to protect them is on us, the keepers of their data. Managing online security risk by ‘reducing the amount and type of data I give out’ trailed far behind. Only 29 percent of respondents said they do that.
  3. In the mobile environment the tendency to act – either positively or punitively – as a result of trust becomes even more acute. Eighty-six percent of people take action as a result of trust concerns – including warning friends and family and using a competitive service. Forty-seven percent would recommend a trustworthy app to friends and family.2

A framework for trust

The main drivers of trust can be understood using the ‘ACTS Framework’ –

A framework for trust

Your organisational strength on these drivers can be understood by how your target market would answer the following questions about you:

AdvocacyAre you acting in my best interest?
ConsistencyHave you proved credible before?
Transparency Do I really understand what you’re doing?
Success Do you have what it takes to help me achieve my goals?

While this framework is simple, there are important nuances.

First, there are trade-offs. Issuing a speedy apology for a mistake is trading off ‘Success’ for ‘Transparency’. Depending on the how strong the ‘Transparency’ driver is for a particular group, this may be a very sound move. This is what Facebook’s CEO Mark Zuckerberg did when he apologised for the Cambridge Analytica scandal in March 2018. Spending some of Facebook’s accumulated reserves of ‘Success’ to rebuild its damaged ‘Transparency’ account will be effective if it shows ‘Consistency’. That is, it will need to demonstrate – not just assert – that it is improving and maintaining protections for users in order for them to trust Facebook fully.

The other important nuance is that drivers carry different weights for different groups, and these weightings change over time. A great example comes from the financial services sector. Research conducted by AustralianSuper shows that a driver of trust for millennials is ‘ethical investing’. As their best interests – ‘Advocacy’ – are served over a longer period of time, investments that show concern for a better future, for example an improved environment or social inclusion, are more appealing. Ethical investing is not a driver of trust for baby boomers, despite what some of them may say in focus groups.3

Advocacy: CHOICE and CluckAR

Publisher CHOICE, now 68 years old, is answering an important consumer trust question: ‘Are your free range eggs really free range?’ by creating an augmented reality (AR) free-range egg detector.

Alan Kirkland, CEO and Viveka Weiley, Head of New Things

Viveka Weiley, head of CHOICE’s New Things Unit explains:

‘Like everything at CHOICE, CluckAR starts with a real consumer problem. [Product labelling for] free range eggs is kind of a disaster. We’ve been campaigning on this issue, we have fantastic information about it, but we needed a new way to get the story across and to help people with the problem. So we built an augmented reality free range egg detector that is available on all of the app stores. It has been a massive hit for us and it’s really helping to change this market.’

CEO Alan Kirkland highlights how innovating with new technology also involves a basic level of trust, that is, trusting your audience will understand how to use your innovative new product:

‘There were some real risks going with AR for this solution. There weren’t many AR apps in the market at the time, so we took a big gamble that consumers would actually be able to work out how to point their smartphone at an egg carton in a shop to see chickens projected on top of it to tell them whether they were free range eggs or not. The gamble worked, but it may not have.’

‘It is purely about experimentation in finding better ways to meet consumer needs.’

Alan Kirkland, CHOICE

At the time of writing (May 2018) 130,000 Australians were using CluckAR to scan over 20,000 egg cartons each week. The initial version relied on a database of egg producers CHOICE had compiled over the years. Version two included a feedback mechanism for consumers to report additions and updates. Now, 90 percent of CluckAR’s content is crowd-sourced.

While trust in CHOICE as an advocate is long-standing – ‘Advocacy’ is core to their mission – they didn’t have proven success in new fields like AR. Alan Kirkland explains how they structured the organisation to allow innovation to flourish:

‘There are two parts: investment and freedom. On the investment front, we are putting seven percent of our operating budget this year into Viv’s New Things team. This investment has been over five percent consistently for the last three years. The other thing that makes it work is it is absolutely free from the existing business model. There is no requirement to deliver core revenue, there is no requirement to service the existing business’s needs. It is purely about experimentation in finding better ways to meet consumer needs.’

Source: CHOICE

Consistency: Gary Mehigan and A Plate to Call Home on PodcastOne

While emerging in terms of advertising support, podcasting is fast becoming a consumer favourite. According to ABC research, 61 percent of podcast listeners increased their podcast listening in 2017.

Meanwhile, IAB research shows that the proportion of media buyers booking podcasts regularly nearly tripled (from five percent to 14 percent) over the same period.5

 

Gary Mehigan, host of A plate to call home, PodcastOne

In September 2017 Australian radio and regional television broadcaster, Southern Cross Austereo, formed a partnership with US podcasting platform, PodcastOne, to bring the platform to Australia. SCA leveraged its core capability, curating great audio content. As a result, 95 percent of listening on PodcastOne Australia is of Australian content.

The quality is high. For example, restauranteur and Masterchef judge Gary Mehigan’s interview program, A plate to call home, consistently delivers surprising insights and compelling stories drawn from Australians working in the food industry. The insights come from interviewees revealing fascinating and often touching moments of vulnerability, which they do because they trust the interviewer. Nigella Lawson, who famously doesn’t talk about her children, does so with Gary. Australia’s top chocolatier, Kirsten Tibballs, recalls her time as a teenager fighting a serious eating disorder.

Behavioural scientists describe trust as a ‘repository of preparedness to act during vulnerability’. It is this willingness to act – whether it’s a transaction, a recommendation or a revelation – that is the payoff for investing in a consistently credible brand. Gary Mehigan talks about how he maintains credibility and builds trust by finding commonalities and not pretending he’s something he’s not:

'Building trust with your interviewees is fairly easy to be honest. It basically starts with a common interest: food is the common interest, it’s the bond. [Then] being gentle, giving them space, allowing them to take the conversation in the direction they feel comfortable and injecting a little humour.

'For me, even as a brand, people know me as a chef and as a restauranteur and as a judge on Masterchef. That’s what I am good at, that’s what I can rely on. So whenever I feel myself wanting to comment on something out of my field, I remind myself that my field of expertise is cake...'

Transparency: JAXSTA and giving creatives credit where credit’s due

Seventeen years ago, when the recorded music industry first started its painful shift from physical to digital, it lost more than sales margin. It lost one of its most important marketing channels: the jacket cover. The printed sleeve of a CD, vinyl record or cassette provided the names, and sometimes contact details, of the many freelance economy workers who contributed to the final creative product.

 

Jacqui Louez Schoorl, co-founder and CEO, JAXSTA

An Australian from the film, TV and music industries, Jacqui Louez Schoorl is solving this problem by creating a global database of official music credits, a combination of LinkedIn meets IMDB, the International Movie Data Base. JAXSTA ingests data from multiple authoritative sources, including trusted industry organisations like the Recording Academy (which produces the GRAMMYs). By de-duplicating this data before deep-linking it, ensuring it no longer exists in silos, JAXSTA is meeting some new and old needs. It’s a new source of music discovery for listeners; an employment referral agency for creatives; and, a potential revenue stream for record labels. JAXSTA achieves this as it provides an accurate data feed to digital assistants, or to service providers to improve their playlist algorithms.

JAXSTA co-founder and CEO, Louez Schoorl, says this transparency is essential:

‘Let’s imagine we are looking up an artist like Imogen Heap. You have the ability to see everything she has done individually as an artist, then all the people she has worked with as a songwriter and as a producer, and her awards and nominations. You can’t diminish the importance of that in our business, in any creative business. Credit where credit’s due creates trust, and it’s also providing transparency. There are a lot of people who like to claim they’ve worked on things. With JAXSTA, you won’t really be able to do that.’

Five years in the making, JAXSTA launches in 2018. Accelerating its take-up will be the popularity of voice-activated smart speakers, which to date, have seen music as their strongest use case. These internet-connected speakers, embedded with an AI-digital assistant and controlled by voice commands, will make it much easier for listeners to create their own paths of discovery and new playlists. JAXSTA enables the recorded music industry to benefit from these new and fast-growing consumer devices as it helps solve the issue of missing metadata. For example, if a listener asks ‘Who produced this song and what else have they worked on?’ JAXSTA will be able to tell them.


 

 

1Whom do consumers really trust?, Global Consumer Insights Survey 2018, PwC

2Global Consumer Trust Report 2017, Mobile Ecosystem Forum (MEF)

3Trust; Before Reconstruction Comes Deconstruction, Forethought and AustralianSuper

4ABC Podcast Research 2017

5IAB Australia Digital Audio, State of the Nation, February 2018

Follow PwC Australia