Piaras Kelly PR - Public Relations in Ireland

Two weeks ago, we unveiled the Irish results of the Edelman Trust Barometer. I’ve included a slideshow from our presentation below. It threw up a lot of interesting data, especially from a communications perspective. The research was aimed at uncovering who we trust and what do we see as the most reliable sources of information. The survey, which was extended to Ireland for the first time this year, reveals the level of trust placed in companies, institutions and various sources of information ranging from the media to bloggers.

Business organisations come out as the most trusted institution in Ireland. This comes as no surprise given our recent economic boom. NGOs rank second. The media and government in general are joint third. Religious institutions rank bottom. Technology is the most trusted industry. Again this can be put down to the numerous benefits it has brought to our society.

There’s a lot of interesting data from a communications perspective. Although the public’s trust in the media is falling, the research shows that traditional media still has an important role to play. It also highlights the emergence of peer-to-peer communications. More importantly, it shows that this medium doesn’t simply consist of blogging and the world of peer-to-peer communications is just as fragmented as the world of traditional media.

The new model of communications that has been identified is about the influence of multiple stakeholders using a variety of channels. What does that mean exactly and how can it be achieved? Richard Edelman describes an organisation that has adopted the model as a smart company that uses its CEO to inform investors, the media and other key stakeholders, while at the same time arming its employees and customers with information to discuss issues with their peers. For me, it goes even further. It’s about building relationships.

Instead of looking to build sales, companies need to build long-lasting, valuable relationships with their customers. Why? A company is more profitable when it has the repeat custom of the people who purchase their goods or services. Instead of taking a short term view and looking to turn a quick buck, companies should try to develop bonds with their customers. There are numerous commercial benefits from taking such an approach. For example, in their paper, “The Long-Term Effects of Joining and Participating in Customer Communities“, Rene Algesheimer and Utpal M. Dholakia showed that eBay surpassed their competitors by developing customer communities:

Customer communities accomplish many marketing objectives effectively and economically, such as providing credible, low-cost, customized “high-touch” service and support (from expert to novice customers), rapidly disseminating new information, providing high- quality feedback from customers, signaling early warnings from the marketplace, and giving the firm access to its loyal and engaged customers.

Consumers buy from people they trust. Unfortunately the kind of relationship that is required to build trust has been discouraged of late, but this is beginning to change. In his book, ‘The Perfect Store - Inside eBay‘, Adam Cohen discusses the first business plan Jeff Skoll wrote for eBay:

Before the industrial revolution, the craftsman and the customer had a personal relationship. The quality and service were excellent, but the personal attention meant that goods were expensive, beyond the reach of most people. The industrial revolution ushered in a new era of mass production, in which goods were cheaper. But these efficiencies came at a cost: with large factories and elaborate distribution channels , buyers and sellers no longer formed personal relationships. The computer, Skoll argued would make it possible to reclaim the old-style relationship.

The Internet has changed the way we do business. Although it might not always be visible, every single industry has been affected. Importantly, it has shifted a lot of power into the hands of consumers. The following passage from ‘Freakonomics‘ captures this brilliantly:

Information is the currency of the Internet. As a medium, the Internet is brilliantly efficient at shifting information from the hands of those who have it into the hands of those who do not. Often, as in the case of term life insurance prices, the information existed in a woefully scattered way. (In such instances, the Internet acts like a gigantic horseshoe magnet waved over an endless sea of haystacks, plucking the needle out of each one.)…it has vastly shrunk the gap between the experts and the public. The Internet has proven particularly fruitful for situations in which a face-to-face encounter with an expert might actually exacerbate the problem of asymmetrical information - situations in which an expert uses his informational advantage to make us feel stupid or rushed or cheap or ignoble. Consider a scenario in which your loved one has just died and now the funeral director - who knows that you know next to nothing about his business and are under emotional duress to boot - steers you to the $7000 mahogany casket. Or consider the automobile dealership: the salesman does his best to obscure the car’s base price under a mountain of add-ons and incentives. Later, however, in the cool-headed calm of your home, you can use the Internet to find out exactly how much the dealer paid the manufacturer for that car.

As I have pointed out before, we now live in the era of the educated consumer. Nancy Turett, global president of health in Edelman, adds, “Sophisticated and socially engaged, they form their trust by listening, conversing, gathering opinions, and thoughtfully forming their own.” Now more than ever, we rely on the opinions of others when deciding what to buy. Today’s companies are charged with shaping the conversation, something that sounds like an impossible task. So how does a company go about building relationships with its customers? By starting from the inside out.

An organisation’s employees are on the frontline of shaping the public’s opinion about it. They have titles like CEO, account manager or sales assistant, but we forget that they have other titles after they clock off like mother, father, son, daughter, partner or friend. If they have nothing positive to say about the company, the general public will fare little better in their opinion. As Gary Grates, global managing director of Edelman Change and Employee Engagement, points out, “Instead of treating employees as a captive audience, it is essential that leaders and communicators recognize them as a public constituency capable of opinion-shaping, decision-making and organizational success. When a company ignores this truth, it suffers. Employees now have the technology as well as a choice of public forums for airing their concerns.” A fantastic example of seeing this in action is the email Michael Dell sent to Dell employees spelling out the steps the company is taking to turn its fortunes around.

Another point worth addressing from the research is the hype around social media, blogs in particular. Blogging has been heralded of late as leading the peer-to-peer communications revolution. However, the research shows that the medium of peer-to-peer communications is just as fragmented as that of traditional media. Simply put, not everyone behaves the same and the research went some way to recognising this. Four distinct groups were identified based on common behavioural characteristics:

• Public activists - Engage in outspoken public actions
• Social networkers - Share, seek and value public opinions
• Solo actors - Take more passive or personal actions
• Uninvolved - Opinions of brands not driven by trust reputation

An overview of these four groups can be found on slides 36 and 37.

Instead of repeating the mistakes of the past and focussing all your efforts on a narrow range of mediums, companies would be better off by inverting the communications funnel - build out to influence multiple stakeholders using a variety of channels.

If anyone wants an invite to signup for SlideShare, leave a request in the comments section and I’ll send one off. Here’s a link again to my colleague, Geraldine O’Neill, being interviewed about the Trust Barometer on the Persuaders.

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