It is not easy to define brand authenticity. Yet consumers have little difficulty spotting it (or lack thereof) in a company. This is because consumers, particularly those in Asia, are placing increasing importance to the authenticity of a brand when determining their purchasing intent. Consumers today want to buy from businesses that engage with them in a genuine way.
We have a tendency in marketing to think of authenticity as being strongly driven by heritage, but today’s consumers are just as interested in what they perceive to be a brand’s commitment to innovating in a way that is relevant to and can improve their lives.
The marketing communications agency I work with in Asia, Cohn & Wolfe, identifies three main drivers of brand authenticity:
1. Reliable: delivering on promises and of high quality;
2. Respectful: treating customers well and protecting their data and privacy; and
3. Real: communicating honestly and acting with integrity. Much like what we would expect in an authentic human relationship.
Brand authenticity correlates with greater purchase intent
Cohn & Wolfe recently unveiled the 2017 Authentic 100 Brands Index as part of an annual global consumer survey of more than 15,000 consumers in 15 markets across the world on the role of authenticity in business. Our research shows a strong link between brands that behave and communicate authentically and their ability to attract and keep customers.
Globally, 62% of consumers are more likely to buy from a brand perceived as authentic while 91% say they are willing to reward a brand for its authenticity via purchase, investment, endorsement or similar action. In Asian markets, the proportion is even higher than the global average.
Brand authenticity is the key to wooing the tech-savvy Asian consumer
The results also showed how brand authenticity is more important to Asian consumers than those in other regions. In China, 68% of consumers indicated higher purchase intent with brands they perceive to be authentic, with India and Indonesia at 67%, higher than the global average of 62%.
Consumers in Asian countries also displayed the most positive sentiments towards brand authenticity, with 43% of consumers in China and 37% in India perceiving brands to be open and honest compared to a global average of 22%. Similarly, 49% of consumers surveyed in China agreed that brands take full responsibility for their actions, compared with 39% in Indonesia and 38% in India. This compares to the global average of 25 percent. The higher positive perceptions in Asian markets juxtapose with consumer cynicism in Europe, where belief that brands are “open and honest” is in the single digits (Sweden: 5%, France: 7%, Germany: 8%, Italy: 9%).
The results underscore the opportunity for brands operating in Asia, as consumers in key regional markets demonstrate a greater wiliness to do business with companies that put more effort on building strong customer relationships and experiences.
Consumers giving more credit to tech firms
It is also striking that technology companies rate so highly on authenticity. Globally, the five most authentic brands all belonged to the technology sector: 1) Amazon, 2) Apple, 3) Microsoft, 4) Google and 5) PayPal.
In China, Huawei and Hewlett Packard topped the list, while Google, Apple and Microsoft were among technology brands featuring high in the rankings for India, Indonesia, Hong Kong and Singapore. Indeed, technology brands comprise 70% of the Top 10 most authentic global brands.
So with digital transformation delivering greater choice and lower costs, consumers are giving more credit to tech companies. Technology has become a ubiquitous and integral part of how people manage their lives, and there are now countless opportunities for these brands to make a positive connection. Our study shows that people view the top-ranked technology brands as genuinely wanting to deliver new ways to make people’s lives easier to manage.
Opportunity to address the ‘Authenticity Deficit’ in Asia
The rules of communication have irrevocably changed, and we’re seeing consumers reward brands that understand how to engage with them openly and honestly, particularly here in Asia. Consumers will forgive the occasional corporate misstep if a company is upfront, and addresses the issue head-on. The brands topping the Authentic 100 understand this, and have demonstrated consistently that they value more than just their bottom lines by fostering a genuine dialogue with their customers.
But a large authenticity deficit between brands and their consumers remains, with 75% of consumers indicating that brands and companies have a credibility problem. In the era of digital everything, business leaders have a new way to harness the power of authenticity. More companies should embrace the ‘Age of Authenticity’ to woo the increasingly tech-savvy consumers in Asia. Brands that don’t, risk being left behind.
Matt Stafford is president of Asia Pacific at Cohn & Wolfe, a member of PRHK.