Aussies are more likely to buy from bastard brands, says new study

Lyndall Spooner, founder and Chief Executive Officer of Fifth Dimension

Consulting agency, Fifth Dimension, released the results of its global research that answers why consumers buy from brands they don’t trust. The study also shows Aussie consumers allocate a greater share of wallet to ‘bastard’ brands compared to those in the UK and US.

According to Lyndall Spooner, founder and CEO of Fifth Dimension, the results are surprising. “First, we must address the elephant in the room. We are constantly told that brands need to be trusted to grow, yet year after year well-known studies that measure brand trust show many of the world’s leading brands are also the most distrusted,” Lyndall Spooner said.

“What is the problem here? Have we got it wrong and we live in a society where trust no longer matters, or do we not understand what trust is and how to measure it? At Fifth Dimension we have dedicated the last three years to understanding brand trust, we have surveyed over 10,000 consumers across the world to replicate and validate our findings.”

“Trust does matter in society, but our understanding of trust are fundamentally flawed.”

What role does trust play in brand choice?

Spooner explained that through Fifth Dimension’s research work, it investigated the role trust plays in brand choice. It found that trust in brands is comprised of two traits, the capability of a brand to do what it promises and the character of the brand to be honest and do no harm.

“When we break down thousands of consumer brand decisions across multiple industries and countries, we find the same patterns always emerge,” Spooner added.

  • Brands that best meet consumer needs (brand capability) win the greatest share of wallet
  • Brands with the greatest positive impact on society are the most advocated
  • Brand capability and character are independent of each other
  • Brand capability is twice as important as brand character in brand decisions

What makes consumers buy from brands they dislike?

Fifth Dimension also found that consumers frequently buy from brands they don’t like over the ones they do to access the best products and services for their needs.

“Consumers will not sacrifice the fulfilment of their needs to benefit a corporate entity that positively contributes to society or even to satisfy their own principles,” Spooner emphasised.

“Let’s take a step back and consider the broader implications of these findings.

“When you buy from a brand you don’t like a cognitive dissonance forms, and at some point in the future you will want to resolve this psychological stress. If a consumer buys from a brand they believe best suits their needs but they think the brand in some way harms society, then at some point in the future they will be compelled to look for an alternative.”

“If we were to profile these consumers, we would see they give low net promoter score (NPS) ratings and say they do not trust the brands they allocate their greatest wallet share.”

“Consumers who believe the brand they chose not only best suits their needs but is also making a positive contribution to society, are more likely to give a greater share of their wallet and to go out of their way to advocate the brand as they want the brand to succeed.”

Do Australians care about brand character?

According to Fifth Dimension research, Aussie consumers have higher levels of dissonance than consumers in the UK and the US as they allocate a greater share of wallet to brands that have a weak character, making them more likely to switch brands in the future. This is not a case of the tall-poppy syndrome. Aussies don’t simply label all companies as bastards.

Across multiple industries in Australia, the UK and the US, on average one in every five brands are considered to have a weak character, where the brand is believed to be deliberately deceitful or complacent in knowing their products, services or practices do harm to society.

“While the incidence of bastard brands is similar globally, in Australia market value is more concentrated with these companies. I can’t tell you how many times I have heard an Aussie consumer say they will ‘take the bastard’s money’ if they can get a cheaper home loan rate or ‘the bastards must be listening to me’ but still use smart home devices,” Spooner said.

“There are two intrinsically linked reasons Aussies give a greater share of their wallet to bastard brands. The first is that these brands are considered to be highly capable in meeting the consumer’s needs – cheaper home loans, better convenience and services and so forth.”

“Secondly, historically we have had fewer brands to choose from. Often with the tyranny of distance in Australia few brands are able to match the quality of services across the country.”

“But with competition increasing, and many services now effectively delivered online, it is likely Australian consumers will proactively look to resolve their dissonance and their spending will move to be more in line with patterns seen in the United Kingdom and the United States.”

How does brand character compare in other regions?

Spooner explained that in the UK and US, brands that are strong on both brand capability and brand character win the greatest share of wallet and achieve the highest levels of advocacy.

In Australia, bastard brands achieve the same and sometimes greater share of wallet as leadership brands but always have lower advocacy and often negative NPS scores.

“As we have consistently shown in our research findings, most brand trust studies are flawed. Their brand trust scores often do not align to a brand’s market share,” Spooner explained.

“We know brand trust is comprised of two traits – brand capability and brand character. But when you ask a consumer if they trust a brand with no context the consumer bases their answer on only one of these traits depending on how they interpreted the question.”

“Across Australia, the UK and the US, 60 percent of consumers base their answer on a brand’s capability and 40 percent base their answer on the brand’s character. Hence when you ask a generic brand trust question, we only collect one piece of information about the brand, but we don’t know if it is a rating of capability or character,” she added.

“For the 40 percent of Australian consumers who think the question is asking about the character of the brand they are 88 percent more likely to say they distrust the brands they buy from than the people who thought the question was asking about brand capability.”

“Generic brand trust ratings are a waste of time and net brand trust scores are meaningless. There is little to be gained or lost by being rated a trusted brand in a generic study as it will not accurately predict your market share or customer loyalty and future growth.”

“In fact, our research shows leadership brands that are strong on brand capability and brand character achieve more than double the level of advocacy and 50 percent higher share of wallet than ‘trusted brands’ in a generic brand trust study,” she further commented.

“The next time you see any of the results of a generic brand trust study just remember you are not looking at the complete picture of trust in the brands listed and the ranking of brands will only weakly predict market share or advocacy. And If you want to optimise market share and advocacy you should be aiming to become a leadership brand,” she went on.

“Stop measuring generic trust in your brand and measure your brand’s ability to meet consumer’s needs and perceived contribution to society relative to your competitors. And if you are a bastard brand watch out, as competition increases and brands with strong character become more capable, your time in the sun is almost over,” she concluded.