Is Consumer Trust Waning?
Uh-oh. Just when it seems social media can do no wrong, Yelp gets hit with a class-action lawsuit that essentially accuses the local review heavyweight of extortion. Yelp of course fired back, but the end result of such cases is that some element of consumer trust has been inevitably lost. A new study suggest that consumers trust in social media’s most valued properties is waning.
Public relations firm Edelman just released its 2010 â€œTrust Barometer.â€ It indicates that only 25 percent of the public thinks their friends and peers â€œare credible information sources about companies,â€ down from 45 percent the previous year.
Such a study can strike fear into the hearts of marketers who increasingly siphon budget dollars into Facebook, MySpace and Twitter; one of the reasons they do so is to take advantage of a social environment that encourages sharing opinions with friends. If three-quarters of those opinions arenâ€™t viewed as credible, however, that could mean a marketing investment in social media isnâ€™t such a great investment after all.
Edelmanâ€™s CEO, Richard Edelman, thinks the fact that consumers are less reliant on each otherâ€™s opinions suggests that â€œitâ€™s a more skeptical time. â€¦ People have to see messages in different places and from different people. That means experts as well as peers or company employees.â€
In Ad Age magazine, Michael Bush observes:
In some cases, social networks themselves may be contributing to the decline in trust. Platforms such as Facebook and Twitter have allowed people to maintain larger circles of casual associates, which may be diluting the credibility of peer-to-peer networks. In short, the more acquaintances a person has, the harder it can be to trust him or her.
This, it seems to me, is a core problem. In the pre-social media days, each consumer had a relatively small circle of friends and their opinions meant something. Now the meaning of â€œfriendâ€ has morphed into nothing more than an online contact. Such a contact hasnâ€™t necessarily built up trust with the consumer over time. These â€œfriendsâ€ couldnâ€™t possibly have the same kind of influence as a closely knit group of personal friends with whom a relationship has been built.
If thereâ€™s a silver lining in the results, it appears that the credibility of friends outweighs the trustworthiness of television news, according to the Trust Barometer. But consumer trust is down across the board. Newspapers and radio news were trusted only slightly more than friends.
So what should marketers who are still enamored with social media do? Global brand strategist Jonathan Salem Baskin has a provocative answer:Â Take a long hard look at where to spend your marketing dollars. â€œNobody with responsibility for a bottom line has ever felt comfortable with social media as a replacement for traditional advertising,â€ Baskin says. In fact, Baskin thinks too many marketers may have gotten into social media because of â€œthe allure of cost savings and glib convenience.â€
Baskin thinks part of the reason consumers may have driven the popularity of social media in the first place is because â€œthey ran away from commercial speech because advertising had proven to be so irritatingly useless. â€¦ If we renewed our commitment to selling based on credibility, authenticity and utility, maybe people would trust what we tell them, respect our corporate reputations, and give us their purchasing loyalty.â€
If Baskin is right, marketers need to examine their own promotional strategy and make sure they are meeting the informational needs of consumers. They canâ€™t abdicate responsibility for traditional marketing simply by picking social media over another form of communication. Sounds like marketers have some soul searching to do.
Still, it leaves open the question of the apparent decline in consumer trust. Consumers may just be feeling a general malaise about the economy. Or they may be telling us that they are less confident in the advice they receive from their friends â€“ and the information they obtain from media channels. If the latter is the case, itâ€™s something we should all be concerned about.
About Barry Silverstein
Barry Silverstein is a freelance writer/marketing consultant. In addition to writing for ReveNews, he is a contributing writer to Brandchannel.com, the worldâ€™s leading online branding forum. He is the author of three marketing books, The Breakaway Brand (co-author, McGraw-Hill, 2005), Business-to-Business Internet Marketing (Maximum Press, 2003) and Internet Marketing for Technology Companies (Maximum Press, 2003). Barry ran his own Internet and direct marketing agency for twenty years. You can find Barry on Twitter @bdsilv.