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Market-Based Solutions to Vital Economic Issues
Research
Dec 1, 2019

In Brands We Trust? A Multicategory, Multicountry Investigation Of Sensitivity Of Consumers’ Trust In Brands To Marketing-Mix Activities

Abstract

The essence of a brand is that it delivers on its promises. However, consumers’ trust in brands (CTB) has declined around the world in recent decades. As a result, CTB has become a major concern for managers. The authors examine whether CTB is influenced by marketing-mix activities (i.e., advertising, new product introduction, distribution, price, and price promotion) implemented by brands. The authors propose and show that the sensitivity of CTB to marketing-mix activities is moderated by consumer, category, and country characteristics, using a multisource data set consisting of a survey of 15,073 respondents and scanner panel data on 589 brands in 46 CPG categories across 13 countries (including the four largest emerging markets), which collectively account for half of the world’s population. The authors find strong positive effects for advertising and new product introduction intensity, weak positive effects for price and distribution intensity, and a minor negative effect for price promotion intensity on CTB. Furthermore, the authors find that the effect of marketing-mix activities on CTB is moderated by consumers’ personality traits, consumers’ reliance on brands in a category, and countries’ secular-rational and self-expression cultural values.


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