A matter of trust
Jennifer Marks -- Home Textiles Today, June 24, 2002
We are just about midway through The Year of Corporate Scandals, and shocking allegations are rolling in like waves.
The good news is that the retail industry seems to be emerging from this mess with its reputation intact. Okay, there is that business of the FBI looking into Kmart's multi-million-dollar loan program for senior executives. But measured against the scope of misdeeds elsewhere, it pales in comparison to the hundreds of millions that Enron execs mopped up while Rome burned, Adelphia Communication Corp.'s secret loans to major shareholders, Tyco's tax evasion problems and Merrill Lynch's alleged conflict of interest, to name but a few.
So overwhelming is all this news that the Wall Street Journal has inaugurated a series on the phenomenon titled "What's Wrong?"
"Why is so much corporate venality surfacing now?" the paper asked in its first report last week. "Is there more of it, or is more attention being paid? Did a few executives lose their ethical moorings in the exuberance of the 1990s? Or did a few notorious offenders break rules that many others merely bent?"
The threat of suspicion is sufficiently pervasive that Wal-Mart felt compelled to address the issue in its annual report to shareholders earlier this month, with a heavy emphasis on assurances of "trust" and "integrity."
While it's understandable that any public corporation would be looking over its shoulder these days, it also bears pointing out that the retail segment continues to enjoy a high degree of trustworthiness among consumers. This is particularly true when one compares the current level of regard in which consumers hold utility companies, insurance firms, the health care industry and financial services corporations.
That level of trust provides the industry with a tremendous foundation upon which to build during this period of post-recession recovery. With consumers besieged by news of corporate chicanery and repeatedly unsettled by threats to national security, retailers have a real opportunity to cast themselves as a community that gives its customers an honest deal for an honest buck.
The same holds true for consumer product manufacturers, most of whom have done an admirable job of consistently improving product quality while maintaining traditional price points. It wouldn't hurt to add emphasis to the concepts of reliability and product integrity on those hang tags, shelf talkers and package inserts that are flowing into consumers' homes. And among those who conduct consumer print campaigns, it might also be a good time to point out the company's decades of good service.
In the end, it all might result in that most elusive consumer trait of all: loyalty. Yes, it's been written off as a dead duck, and consumers seem to be quite happy with all the choice that's available to them.
But it's still possible to bind the consumer closer to a particular store or a particular brand. And there's no time like the present for taking a stab at it.
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