‘Transparency’ more important than brand appeal in consumer purchasing decisions

London – October 25, 2012 -Transparency is now more important to consumers than brand appeal when it comes to buying products or dealing with a business or organisation, according to new research released today by Cohn & Wolfe.

The research – which looks at the role of transparency in communications and business - also found that transparency trumps both recommendations online and from friends. 

Defined in business terms as the willingness of a company or organisation to share information openly and ethically with its stakeholders, the research found that transparency has increased in importance in the wake of recent high-profile scandals – including the News of the World phone-hacking investigation, the outrage around MPs expenses and the banking crisis. Nearly 7 in 10 (68%) of consumers surveyed said that transparency had become a more significant factor since these issues occurred.

Based on a survey of 1,000 UK consumers, the research also reveals those measures deemed by consumers to be most important when it comes to judging if a business or brand is operating transparently. Being open and honest about the sourcing of raw materials and ingredients is seen as most critical, with 38% of people citing this as significant.  

Revealing a distinct lack of trust in the openness and transparency of large organisations, over half of respondents (52%) agreed that big businesses “divulge only what they need to for regulatory purposes.” Going even further, more than one in ten (12%) of respondents believe that big businesses deliberately avoid transparency in order to make money.

The research findings will be presented as part of a panel discussion in front of 50 business, marketing and communications leaders at an event held on 25 October at Cohn & Wolfe’s London offices.

Entitled ‘Transparency & authenticity – a new communications landscape?’,  the event will involve experts from the worlds of academia, journalism and business. The panel includes: Ioannis Ioannou, Assistant Professor of Strategy and Entrepreneurship at London Business School; James Ashton, Head of Business at London Evening Standard, The Independent, The Independent on Sunday and i and Dominic Burch, Head of PR and Social Media at Asda.
 
Scott Wilson, Cohn & Wolfe UK CEO said:“Given the troubling events of recent months, businesses and brands are facing a period of unparalleled and intensive scrutiny. At the same time, however, consumers have been emboldened by the opportunities offered to them by the Internet and social media and increasingly expect companies and brand owners to be open, responsive and transparent as a pre-condition of doing business or making a purchase.
 
“What this research is showing is that the demand for openness goes way beyond the age-old totems of trust and reputation. In today’s world of social commerce and customer relationship management, transparency is now becoming a powerful business tool and this presents both opportunities, but also significant dangers for some of our largest businesses.”
 
The research, conducted by ICM, also examined how the growth of social media is shaping the future of communications and transparency. Over a fifth of consumers (21%) expect businesses to respond to complaints left via social networking sites within 1-4 hours. Moreover, nearly half (47%) of 18-24 year olds said that by 2020 they expect all CEOs and senior business leaders will be visible and accessible to consumers on social media 24 hours a day, 7 days a week.
 
Ioannis Ioannou, Assistant Professor of Strategy and Entrepreneurship at London Business School commented:“The findings of the survey indicate how critical it is for corporations to engage with a key stakeholder and their consumers, in an authentic, ethical and transparent way. To go beyond what simply the law mandates, and to effectively communicate what is material and why, within the industry in which they operate and as it relates to their product or service. It entails therefore an understanding that the relationship between a corporation and its consumers is profoundly long-term; in this relationship, the survey shows, transparency constitutes a key underlying foundation. It is also a key strategic lever.”
 
About Cohn & Wolfe
 
Cohn & Wolfe, a global communications agency, builds brands and corporate reputations through an uncompromising commitment to creativity.  The agency’s strategic approach unearths fresh, relevant insights leading to communications solutions that deliver measurable business success.  Over its 40-year history, Cohn & Wolfe’s award-winning brand marketing work and world-class digital media campaigns have attracted top brands around the world. In 2012, Advertising Age recognized Cohn & Wolfe’s independent-minded, entrepreneurial culture by naming it one of the “Best Places to Work in Marketing & Media” for the second consecutive year.  The agency has more than 1,100 employees in over 50 offices across North America, EMEA, and Asia. Cohn & Wolfe is part of WPP (Nasdaq: WPPGY), the world's largest communications services group.
 
Contact:
 
Hannah Dawson
Cohn & Wolfe
+44 (0) 20 73315425
Hannah.dawson@cohnwolfe.com
 
Scott Wilson
Cohn & Wolfe
+44 (0) 20 7331 5300
Scott.Wilson@cohnwolfe.com