Brands will increasingly find that they are operating in a nowhere-to-hide global marketplace when it comes to their reputation and its impact on consumer’s purchasing decisions.
In the light of Starbucks, alongside Google and Amazon, being forced to defended its tax affairs to a panel of MPs and facing protests from campaigners outside its stores, experts have warned that companies will increasingly face “consumer vigilantes” who seek the real truth about organisations and are prepared to publish their findings online.
According to a recent study of 2,000 consumers and executives across the UK and US by KRC Research, the international consultancy firm, around seven in 10 consumers (69%) say they frequently or regularly discuss how they feel about a product they have bought.
Their top talking points are customer service, how employees are treated, company wrong-doing and their feelings about the company as a whole (in other words, its reputation).
Leslie Gaines-Ross, chief reputation strategist at Weber Shandwick, which carried out the study with KRC, said: “For today’s well-informed and highly-connected consumer, purchase decisions are increasingly based on the company behind the brand and what the company stands for.
“More and more consumers are doing research to learn about the companies that make the products they buy. There is considerable risk in failing to fully appreciate the drive of the consumer to know where his or her money is going.”
Fraser Bradshaw, managing director at Saint Nicks, the marketing communications agency that works with Drake & Morgan - the Jillian McLean-led bar and restaurant chain - believes companies will increasingly need to be able to tell consumers “the whole story of their brands”.
He said: “The next generation of consumers are reinventing justice, they are authenticity seekers and digital vigilantes. They demand honesty and transparency.
“They want instant gratification and are prepared to publish [what they find] and are prepared to publish and be damned. Consumers control the media.”
Starbucks has seen its scores on YouGov’s BrandIndex plummet in the days since the tax accusations were raised. The coffee chain saw its Buzz score - which measures the negative and positive comments consumers have heard about a brand in the past week - register a dramatic drop from 0 to -25, and recently stood at -16.7. The figure hit -28.6 during the most heated point of the controversy last month. A year ago, the company’s rating was at +3.1.
This pattern was also reflected in the perception of the brand - with its Index score (a composite of six key image attributes) falling from +1 to -11 and again, the decline has not yet been arrested.
Some commentators, however, believe that while the corporation tax issue might be something for the industry to debate, for consumers it is less important.
Tim Bleszynski, managing director of The Alternative, a branding consultancy that focuses on cause marketing and social purpose, said: “The reason brands do so much and work so hard to have fans is so that when something like this happened their fans are more likely to ignore or forgive it.
“Consumers are less agitated be-cause they are more interested in the service a brand gives. If they continue to provide it to the high standard expected, [taxation] doesn’t become a big issue for consumers. However if they start to negate on core brand values or promises and break a bond of trust, it will start to have an effect [with consumers].”
