Indian consumer trust in brands grows steadily
Brands reach a receptive rather than skeptical audience
Indian consumer trust in brands has grown steadily, a mirror image of the decline in trust that has occurred in most other parts of the world.
Just six years ago, the level of consumer trust in brands was comparable across major country markets. When asked, in 2010, whether they trusted a brand, only 25 percent of consumers responded positively in
India, 27 percent in China, 26 percent in the US and 27 percent in the UK. Indian consumers were on the cusp of a growing fascination with brands, while in other markets consumers were recoiling from the global financial crisis that shook their faith in government, major institutions – and brands, especially in the financial services category.
Subsequently, levels of consumer trust arced upward in India and downward elsewhere. By 2014, 33 percent of Indian consumers expressed trust in brands, while in other countries the percentages of consumers who affirmed trust in brands declined slightly or remained level at 27 percent in China, 25 percent in the US, and 26 percent in the UK.
India is an outlier in trust both for reasons that are particularly Indian and reasons that pertain to the conditions in other parts of the world. First, Indians appreciate brands and the rapidly expanding choice. Second, Indians discharged much of their frustration and distrust of government and large institutions in the 2014 election, when they removed the long-serving Indian National Congress party.
Brands are beneficiaries of the ensuing rise in consumer confidence and optimism. Although India recently experienced a food safety scandal similar to China’s, the reaction of Indian consumers was measured and did not metastasize to other categories. In addition, the lack of trust in brands in much of the developed world is most fervently directed at banks. Consumers blamed banks for precipitating the global crisis of 2008 and 2009, and they remain critical of banks for not implementing adequate reforms. Global banks was one of only two categories to decline in brand value in the BrandZ™ Top 100 Most Valuable Global Brands 2015. Luxury was the other category.
Indian banks survived the global financial crisis relatively unscathed. Indian financial services brands improved 49 percent in brand value in the 2015 BrandZ™ India Top 50, leading all categories in brand value growth.
Indian brands also scored high in RepZ, the BrandZ™ measurement of brand and corporate reputation. Trust is one component of the RepZ score, which also includes success (strong financial results), fairness (good pricing and practices), and responsibility (positive engagement with employees and society).
The India Top 50 scored 112 in RepZ compared with 108 for the Global Top 50. A score of 100 is average. Indian brands outscored the global brands by a wider margin in the trust component, 110 to 101. Global brands edged past Indian brands only in the success component, 116 to 114.
For brands marketing in India, high consumer trust means that brand messages will reach a receptive audience. Without the need to penetrate through general distrust or skepticism, brands can devote more attention to educating consumers about brand benefits and trying to delight them. It’s important not to abuse the trust Indian consumers place in brands, however. Trust is fragile. It builds over time but crumbles overnight.