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China 2015: MARKET DYNAMICS | Trust

After a period of decline, Chinese consumer trust in brands has stabilized. Trust isn’t rebounding, but it doesn’t seem to be weakening further. About one-third of consumers regard brands, whether Chinese or multinational, as trustworthy.

 Erosion of consumer trust is a global issue, compounded in China by a series of highly publicized product safety problems, particularly a food scandal in 2008. As trust declined, it became a central factor in purchasing decisions. Today, over three-quarters of Chinese consumers say that trust has become more important to them.

Not surprisingly, trust declined most in categories that experienced safety problems, such as milk and other dairy products. At the same time, trust increased in other categories. In insurance, for example, brands have matured and improved the training of agents.

Trust depends on the interplay of category and brand, according to the BrandZTM TrustR studies, which measure consumer trust in a brand over time and willingness to recommend it based on recent performance. Consumers expect brands to be most trustworthy in categories that require uncompromised reliability, such as baby care and airlines. 

The most trusted Chinese brand, Yunnan Baiyao, is a traditional Chinese medicine founded early in the last century. The second most trusted brand is Air China. Expectations are lower in other categories, like fast food, for example.

However, strong brands can outperform their categories. Two food and dairy brands rank high in trust. Yili, ranks sixth in trust, and Mengniu, also ranks relatively high. Both brands collaborated with overseas companies to improve production practices. Yili invited consumers to tour its factories.

The following characteristics are most important to Chinese consumers when thinking

about the trustworthiness of brands: safety, high quality,

good reputation and honesty. Consumers overwhelmingly agree that the most important actions a brand can take to win trust are to use safe raw materials and ensure that products and services meet high safety and quality standards.