2024 Week 39 of 52 75% Trust

Trust is fundamental to contentment and a sense of being able to know that you are being adequately cared for, and psychologically (and otherwise) safe from harm. Whether it is a child knowing they can trust their parents and family when needed, workmates being able to trust their fellow colleagues, or trust in the services we use.

Brands retain customers from building trust. By delivering on promises, brands build trust—in product quality and value beyond price. Advertising builds trust through recognition, strength and stability. Advertising kills trust when it is manipulative or dishonest.

Remember those somewhat annoying Coles ads from 2012 to 2017, when keeping the prices 'down down' was the strategy to both keep customers happy as well as increase market share? "Down, down ..."

Hugely annoying, an ear worm even today, but in a weird annoying way, they built a level of trust. "The supermarkets are there for us."

Remember 2020 when supermarkets were elevated during the height of the COVID-19 pandemic to essential services? Allowing them to remain operational during lockdowns, ensuring that Australians had continued access to food and essential goods. The government deemed supermarkets critical to public health and safety, similar to health services, to prevent panic and ensure supply of essentials remained intact during the crisis. The trust in supermarkets grew and grew, and likely the ego of supermarkets too.

This week, the Australian Competition and Consumer Commission (ACCC) announced that it has taken legal action against supermarket giants Coles and Woolworths, accusing them of deceptive pricing practices. According to the ACCC, both retailers artificially increased the prices of hundreds of products by at least 15% for short periods before launching misleading "price drop" promotions. Supermarkets price gouging, but blaming rising costs.

"The price discounts as promoted were misleading because the discount was illusory," ACCC Chair Gina Cass-Gottlieb.?ACCC sues Australia grocery giants Woolworths and Coles

Just like the banking royal commission from a few years ago (or the aged care commission more recently) findings that are hardly surprising, yet disappointing to have trust abused.

“In almost every case, the conduct in issue was driven not only by the relevant entity’s pursuit of profit but also by individuals’ pursuit of gain, whether in the form of remuneration for the individual or profit for the individual’s business. Providing a service to customers was relegated to second place. Sales became all important. Those who dealt with customers became sellers. And the confusion of roles extended well beyond front line service staff. Advisers became sellers and sellers became advisers.”?Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry

In our work across consumer products sold through supermarkets, we hear of the reality of the challenging ways Coles and Woolworths squeeze their suppliers, paying less, and often not fair terms. At the same time, using the covid economic rebound to push prices up, up.

A Four Corners story earlier this year?set out eight ways in which Coles and Woolworths are said to use their market power >

We are now all wearing higher interest rates, across the board rising costs, households struggling and businesses falling like dominos.

Relationships generally start with trust, and end with abuse of trust.

Life is too short to be in distrustful relationships.

As a voter with an untrustworthy government. Or a customer with untrustworthy products and services.

Trust comes from positive relationships. Seeking those you trust and avoiding those you cannot. Perhaps this is the road to happiness.

Let’s hope business and government place trust as a priority into the future, beyond profit and politics. Trust builds nicer businesses, better governments and movements to an awesome future.

Have a good Friday and weekend!

Jason

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