Edelman report: China has high trust expectations, but are brands delivering?

The concept of Brand Trust is rising in prevalence amongst CMOs and in Board Rooms alike as brands compete to convert consumers from casual purchasers to brand loyalists and advocates. Often perceived as an intangible holy grail that executives aspire to reach towards, how brands look to inspire consumer trust is increasingly top of mind.

Edelman have been leading investigations into trust globally for the last 20 years. This year is no different, with the launch of their Trust Barometer Special Report: Brand Trust in 2020 - a robust study that gives brands tangible insights into how consumers across the globe view trust and how consumers’ needs have evolved over the past year.

2020’s report surveyed over 20,000 respondents from across 11 global markets, four of which are in APAC - China, Japan, South Korea and India. Here, we investigate what this year’s report can tell us about brand trust in China and the role that brands are expected to play in consumers’ lives today.

Chinese consumers value trust - and they use their wallet to show it

Trust is on the rise for Chinese consumers. When asked if they feel brand trust is more important today than in the past, 69% of Chinese consumers agreed that it is - broadly in line with both the APAC-wide results (71%) and global (70%) sentiment.

It’s when it comes to expectations and how brands are held to account that Chinese consumers set themselves apart. A rising number of Chinese consumers believe that brands should have the interest of consumers at heart - and are using their wallet for or against brands that best represent their views.

88% say they have recently started using a new brand because of the innovative or compassionate way they have responded to the virus outbreak. Chinese consumers are also more likely to boycott a brand to force it to change, with a large majority (84%) saying they have convinced other people to stop using a brand they felt was not acting appropriately in response to the pandemic - compared to 40% globally

In China, consumers feel that brands should protect customers and communities - by way of being a dependable provider, ensuring the safety and wellbeing of their employees, customers and communities. While Chinese consumers place high expectations on brands as protectors, they are also generally optimistic that brands are succeeding on this level.

This sense of optimism in brand performance is illustrated in the gap between what consumers consider ‘important’ and whether they feel that brands are 'performing' what they consider 'important' well. Respondents across various brand categories were asked to state how important it is that a brand ‘protects’ in order for them to earn or keep their trust. From there, they were asked to rate how well the brand is performing as a ‘protector’.

In China, the gap between importance and performance ranges from -3 to +7 across 10 brand categories, a gap range that is the smallest amongst all the APAC countries.

In India, another country where consumers place high expectations on brands, the performance gap is much larger - anywhere from +12 to +22 meaning that brands are consistently failing to meet expectations across the board.

In Japan, consumer expectations for brands to be protectors are much lower, as are fulfilment figures. The gap here is 0 to +9.

All of the above points to the high expectations and trust Chinese consumers have of brands.

Where did this high expectation come from?

In the last two decades, there’s been an explosion of choices in the market - consumers no longer need to buy brands they need, but what they like. This is of course, exacerbated by the rise of e-commerce, where consumers could just as easily buy online from other parts of China and the world as, at brick and mortar stores. With more choices, consumers would naturally shift spend from ‘what they need’ to ‘what they want’.

High expectations on brands may also come from the rise of China’s Gen Z. China is seeing an emergence of a generation of consumers who are more likely to opt for home grown brands spurred by a growing sense of national pride and the marked improvement of Chinese brands in terms of technology, quality and design over past decade.

Set apart from generations before them, Gen Z-ers grew up during China’s own rise to become a global superpower, and as such, are generally more confident in their consumption choices.

As Gen Z continues to mature over the coming years and takes a bigger portion of the consumption pie, we might expect the relationship between brands and consumers to become more equal - more of a conversation - in turn making brand trust increasingly more important in China. Gen Z - a generation that expects more from brands and holds them to account - will likely have a greater role in shaping the brand landscape of winners and losers. 

A trust in tech

Digging into individual categories, it’s no surprise that digitally-savvy Chinese consumers are placing high expectations on tech, with 72% saying it’s important for tech brands to be a protector, and 77% saying they want tech brands to be more accessible.  When looking at the performance gap for this particularly category, tech brands are generally doing okay on the ‘protect more’ front, but there is a 6-point gap for accessibility.

Brands should solve societal and personal problems to earn consumer trust in China

Another trend particular to Chinese consumers is around the need for brands to solve both societal and personal problems - to a higher degree than in the other surveyed APAC countries. To compound the list of requirements a brand needs to embody to in order to earn or keep trust in China, consumers also place a high degree of importance on a brand enriching lives.

2020 Edelman Trust Barometer Special Report: Brand Trust. BRAND_KEEP. In general, how important is it to earning or keeping your trust that brands do each of the following? 5-point scale; top 2 box, important. General population, 4-mkt APAC avg. “Solve my problems” is a net of attributes 1-6 and 9; “Solve society’s problems” is a net of attributes 12-16; “Enrich my life” is a net of attributes 7,8,10,11. Please see the Technical Appendix for full text for each role.

But beware the fickle consumer

Beware though, the notoriously hard-to-capture brand loyalty of Chinese consumers, who are known to be less loyal than their global counterparts.

Edelman’s survey asked respondents in 3 categories (shopper, first-time buyer, loyal customer) to indicate how much they trust a brand they buy using a 9-point scale where 9 means they ‘trust it a great deal’. In China, over 1 in 3 loyal customers have a relationship built on the strongest level of trust. Promising but for the fact that globally this figure is nearly 1 in 2 amongst loyal consumers.

So, what can brands do to earn long-term loyalty? A hattrick of solving societal problems, personal problems and enriching lives could be the golden trio.

Will the pandemic have an effect on this? We think it’s likely - though it also depends on which brands. Covid - and public responses to it - may be opening up opportunities for brands to further gain the trust of Chinese consumers.

According to Edelman’s Edelman Trust Barometer Special Report: Brands and the Coronavirus report, 85% of Chinese consumers want brands to shift money and resources to help people meet pandemic-related challenges and 79% believed at the time of taking the survey that ‘our country will not make it through this crisis without brands playing a critical role in addressing the challenges we face’.

Fosun Pharma’s Covid detection kit, Alibaba’s medical donations support, Starbucks’ employee support scheme, Tencent’s triage assessment and YUM Brands’ low-contact customer options were just a handful of the stand-out initiatives to come out of China during the height of the pandemic in the country. Judging by the desire for brands to stand up for good highlighted by the Edelman report, these brands will be in particularly good stead post-pandemic.

Chinese consumers expect a lot. But they are also trusting and optimistic. Set against the backdrop of the pandemic, a burgeoning Gen Z (with associated burgeoning spending power) and US-China tensions that may accelerate consumers’ shift to local brands, brand engagement on a local and personal level is key.

The emphasis that consumers place on brands to solve societal and personal problems, to stand up for change and yet, ‘spark joy’ are the elements that brands should look to capture in their Board Room discussions around how to harness brand trust in China. For brands in general, trust matters more than ever before. In China, this is markedly true.

To read more, download the full Trust Barometer Special Report: Brand Trust in 2020.

To hear more about how brands can stand up for change, watch the Campaign Asia X Edelman panel, featuring Unilever and Instagram.