Consumers rate reputation and shun lying firms, new poll finds
Take note company bosses - shoppers are prepared to fork out more money for a product from a firm that has a strong reputation, a new survey suggests.
And if you end up in a crisis, don't dither. A quick response impresses customers, and, surprisingly, a public apology isn't all that important.
But whatever you do, don't lie. And don't bother hiring a PR firm to manage the fallout.
Just 14 out of 1,000 people surveyed by the PSG Group study found this to be necessary. And eight out of ten of those surveyed said they wouldn't forgive companies that mislead them. The study asked consumers various questions to do with reputation and branding.
Alan Tyrell, PSG Plus director, said company bosses need to get their act together quickly if they have problems.
"Interestingly, 45pc of consumers expect an organisation to immediately launch an investigation into how the crisis occurred," Mr Tyrell said.
He added that "39pc of consumers will seek facts from regulatory bodies, with another 30pc going to traditional media. Organisations now have a very short window of time to inform, communicate and manage crises effectively".
If a crisis occurs, consumers believe, unsurprisingly, that the senior management team and chief executive are responsible for solving it. They generally don't want to see the ceo fired.
Other key findings included:
* 76pc believe that the reputation of a company is important when deciding whether to buy its products or services.
* 52pc say they would be prepared to pay more for a product from a company that has a strong reputation.
* 78pc said they would trust a company that responded quickly to a crisis.
* 80pc said they wouldn't buy from a company that had misled them.
* 74pc said poor treatment of employees would put a customer off from doing business with a company.
Less than half of those surveyed trusted Irish indigenous firms more than multinationals. Just over 40pc said they weren't sure, and close to a fifth suggested they would trust multinationals more.
And just a quarter of those surveyed said they had faith in Irish SMEs over larger Irish companies.
"The fact that 41pc of consumers are unsure if they would trust Irish companies over multinationals in the event of a crisis suggests that wearing a 'green jersey' won't necessarily save you," Mr Tyrell added. "The challenge for Irish companies is that, unlike multinationals, they cannot trade experience or best practice in managing a crisis. Irish companies can however compensate by closely watching consumer sentiment, which will allow them to better predict, prepare and respond to a crisis before it becomes a catastrophe."
The survey also quizzed around 40 company bosses to gauge their views on the same questions. And their responses are a little different.
For example, to the 'if your company faces a crisis' question, a tiny fraction of consumers believed hiring a PR company is required. But more than half of bosses disagree. And in a crisis, bosses believe the buck stops overwhelmingly with the chief executive and the senior management team.
About 55pc of business figures surveyed said they had a crisis in the last two years.
Some 40pc had a crisis plan to activate, while a fifth consulted the internal communications manager and 28pc consulted a PR firm.