German industry magnate Robert Bosch once said: “It’s better to lose money than trust.” In view of the current economic turmoil, the words of the founder of Bosch should really be rephrased as follows: trust is particularly important in times where there is a risk of losing money. Many consumers are beginning to wonder who they can still believe, and not only because of the financial crisis in the eurozone. With regard to the economy, trades do especially well in this respect – in Germany as well as many other countries across the globe. Consumers seem to like established skills in times of uncertainty. However, people also value some other sectors of the economy.
A glance at the map of the world indicates that consumer electronics and domestic appliance manufacturers take the lead in six of the 25 countries surveyed. At 84%, the share of Americans who believe that these sectors are trustworthy is the highest worldwide. Providers of washing machines, TV sets and microwaves are also in first place in the ranking for Australia, Sweden, Japan, the UK and Russia. This status is only topped by the trades: in eight of the 25 countries analyzed, plumbers, electricians, carpenters and bricklayers benefit from top scores when it comes to being trusted. These are the findings of the latest GfK Global Trust Report commissioned by the GfK Verein, for which 28,000 interviews were conducted for the first time in 25 selected countries during fall 2011. In addition to Germany and Switzerland, where trades achieved the highest scores of nearly 90%, this sector of the economy is also in first place in the trust ranking for Belgium, Canada, Austria, Spain, Poland and Italy.
The pharmaceutical industry has the third most first places worldwide and scored particularly well in the emerging markets. In Indonesia and Brazil, drug manufacturers are highly regarded by the population, and they are also trusted in Turkey and Egypt. As countries develop, the level of medical care also increases and this in turn appears to impact positively on the sector’s image. Food manufacturing and retail share the fourth place at global level. With 86% of respondents giving a positive answer, food manufacturers in India, where the economy is rapidly developing, have an especially strong image in terms of trust. They also rank in first place in South Africa and Nigeria. The Dutch are particularly inclined to trust retail at 91%, followed by the French and Argentinians.
Just how expansive the range of trust is, becomes evident by taking a look at selected European countries, such as Sweden, Italy, Russia and Germany. Overall, it is apparent that trust in the economy depends on the economic and political status of countries. The mean value of trust across all sectors of the economy is 65% in Sweden and 63% in Germany. However, in Russia it drops to 47%. Italy just about hits the 50% mark. Has the loss of trust in their politicians widened among the people along the Apennines – in the wake of various affairs and corruption scandals – to include the economy as well? Or do Italians have a trust issue in general? In any case, at around 50%, most sectors are mid range. Only trades as well as consumer electronics and domestic appliance manufacturers deliver higher trust levels. Banks and insurance companies have the lowest score at 24%. The reasons for the lack of trust may include the fact that Italian banks are notoriously unreliable when it comes to simple transactions such as transfers, and this may have permanently undermined people’s confidence in the sector as a whole.
Russia also has rather modest trust in its economy. The mean value across all sectors remains below 50%, with the only exception being consumer electronics and domestic appliance manufacturers who scoop the first place at 65%. The extent to which serious events shatter people’s trust in the economy is very evident in Russia with regard to airline companies. This sector of the economy ranks among the top 3 in some other countries, whereas it comes in last place in Russia. Barely a third of the nation still believes in the quality and reliability of airlines. Hardly surprising, given that Russian airlines experience serious crashes time and again, as was most recently the case in September 2011 when 43 passengers lost their lives.
The Swedes have been spared such tragedy to date, and the number of people who trust airlines is accordingly high. At 74%, airlines rank in joint second place in Sweden with retail and only just after manufacturers of consumer electronics and domestic appliances. The software and computer industry is also trusted by almost 70% of the population. However, the Swedes are rather more critical when it comes to network providers: Internet and telecommunications providers are not trusted by more than half of the nation.
In the midst of the euro crisis, Germany has once again emerged as Europe’s engine for growth on the strength of a relatively stable labor market and positive economic figures. Nevertheless, the crisis has left its mark in people’s minds. Germans believe that banks and insurance companies are not very reliable. Only 36% of German citizens trust this sector. A direct comparison with Sweden (61%) highlights the lack of trust in financial services providers. Telecommunications and Internet providers also scored low in Germany and end up in the penultimate place. Conversely, Germans place great trust in the trades and the providers of consumer electronics and domestic appliances. With scores of more than 80%, these two sectors are at the top of the ranking.
German cars are popular and traditionally sell well, not only abroad. The positive image of the German economic engine is also noticeable in Germany. Nearly three quarters of the nation trusts Audi, BMW & Co. Retail fares even better at 73%. The two sectors are also in a strong position in Sweden, although the trust placed in car manufacturers is slightly lower here than in the Federal Republic of Germany. Without a doubt, the eventful history of Saab and Volvo has contributed to this assessment. By comparison, retailers and the automotive industry do significantly worse in Russia and Italy. Although 50% of Italians still trust retail, the figure for Russia is less than 40%. The car industry is in the mid range in both countries, with values around 50%.
With regard to people’s trust in their fellow citizens, there is also a gap between Sweden and Germany on the one hand and Italy and Russia on the other. While 84% of Swedes and 77% of Germans trust other people in general, the figure for Russia is in the mid range at 69%. In Italy, only one in two respondents stated that they trusted their fellow citizens and in the south of the country, this figure was as low as one in four.
In addition to variations in the country comparison, there are also differences within Germany in terms of people’s trust in the economy. Age is significant in this respect. Teenagers and young adults tend to place greater trust in the economy, whereas consumers become increasingly distrustful as they get older. This may be attributable to life experience, or to the fact that they are less connected with certain sectors of the economy. For example, software providers and computer hardware manufacturers scored particularly low with seniors. Less than a quarter of respondents trust this sector. Conversely, at 85%, the great majority of youngsters trust such companies.
Some sectors which are typically still considered to be the domain of men today are indeed less valued by women. Three quarters of men, but only two thirds of women, trust the car industry. Men are also less skeptical when it comes to computer manufacturers as well as telecommunications and Internet providers. Women on the other hand feel that they are able to trust the pharmaceutical industry more than men do. Banks and insurance companies are also more trusted by women. A total of 41% of women trust this sector, whereas only 31% of men trust this industry. Women also trust other people much more than men do. Yet, the genders agree in terms of who they rank in the top places. The same number of men and women said that they trust trades, providers of electrical appliances and consumer electronics as well as airlines. Consequently, both genders place these sectors in the top 3.
Trust is not unchanging. Who people trust changes with age and also depends on factors such as social and political developments. Entrepreneurs who are aware of this have a clear competitive advantage. Only those who establish trust and make every effort to maintain it will have satisfied and loyal customers. In line with the motto expressed by Austrian author Ernst Ferstl, who once said that “there is no lost and found center for lost trust.”
Data source: GfK Verein (GfK Global Trust Report 2011).
If you have any queries concerning this article or Compact, please contact Claudia Gaspar, e-mail: email@example.com.