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The Business Value of Customer Trust

The Pharma Industry’s Consumer Trust Potential

Business today is in the midst of a social revolution, and no one is immune. Consumers have taken control of the conversation. Brand discussions, product reviews, customer service experiences, and even innovation topics that gain traction are most often customer-led.

The reality of this revolution is that no subject is taboo. Almost everything about your company—good or bad—can easily be shared globally. This makes transparency and honesty critical. 

The best way to genuinely influence whether consumers will say positive things about your brand is to proactively build trust with them. Trust can be broken down into two simple concepts: goodwill and competence (see "The Six Building Blocks of Trust"). Companies must develop a culture that encourages employees to act in the best interests of clients and consumers. And it's not a one-time endeavor. Trust needs to be continuously earned.

What's more, a company is only as good as what the community perceives its reputation to be. The pharmaceutical industry is no exception.

Consumer trust and the pharma industry
Many in the pharma industry argue that the sector is too complex to build credible consumer relationships via social media. We counter that consumer perception about the industry already exists there, so it's important to take steps to improve the industry's reputation. After all, there's a great deal of room for reputational improvement. According to Harris Interactive's 2012 Reputation Quotient, only 31 percent of respondents agree that the pharma industry has a positive reputation. We explored this topic, as well.

Peppers & Rogers Group conducted an informal survey within our social media community in February 2012. The goal was to analyze the perceived trustworthiness of the pharmaceutical industry and what impact social media has in influencing that perception. Though the sample size was small and not statistically significant, it shed some light on consumer sentiment. Of the respondents who participated in the survey, 81 percent indicated that it is very or extremely important that the pharmaceutical industry be trustworthy. Yet only 40 percent indicated that they actually believe the industry is trustworthy to a significant degree. The other 60 percent of respondents believe the industry is not very trustworthy, with 27 percent indicating their level of trust is "extremely small."

Respondents were asked what actions pharma companies could take to improve trustworthiness. A majority of respondents (62 percent) said that a trustworthy pharma company "places customers' interests first" and 56 percent agreed that a trustworthy company "is transparent about its policies towards customers" (see chart).

Transparency and honesty resonated most with respondents as trust drivers. "Transparency goes a long way," wrote one respondent. "Be up front with consumers beyond what they are obligated to be up front about." Another respondent said: "A company should ensure it is up front with a drug's inherent risk and should ensure it presents potential benefits alongside the potential risks." 

Can social media be used to improve trustworthiness? Yes, but not by company-initiated activities alone. Of those surveyed, 75 percent indicated their level of trust of company-initiated social media activities is small. Social media activities generated by consumers are much more reliable sources of information and have a greater impact on how the public perceives the trustworthiness of pharmaceutical companies. Fifty percent of survey respondents said consumer-generated discussions via social media about a pharmaceutical firm can improve its reputation.

Despite this, the pharmaceutical industry appears to continue to use social media primarily as a broadcast platform instead of leveraging its power to build trusted relationships with consumers.

This point was proven by analyzing the Twitter usage of eight randomly selected pharmaceutical companies: Abbott, Amgen, Bayer, J&J, Merck, Novartis, Pfizer, and Sanofi-Aventis. The companies' U.S. corporate Twitter accounts were analyzed during 2011 Q4 to determine how much of their activity was used to reply to direct messages sent to those accounts. Those with the fewest number of replies were Novartis (0 percent), Amgen (0 percent), and Pfizer (3 percent). The three highest were Sanofi-Aventis (39 percent), J&J (17 percent), and Bayer (17 percent). These numbers are still quite low, however, when compared to companies known for their customer service and social media savvy, for example, GEICO (80 percent), Ford (60 percent), and Southwest Airlines (52 percent).

This data shows that there is an opportunity to interact with consumers to improve reputation and build trust, if done strategically. Some of the respondents complained that it was hard to judge the trustworthiness of a pharma company because they don't know which companies own which brands. That sentiment signals that trust-building activities need to live at the brand level, with consistency across the many brands under a company umbrella.

Steps to build trust
Pharma firms must place more emphasis on transparency, a pillar of goodwill. It's also imperative that companies not rush products to market. You need only look at the aftermath of a recall to see that once trust is destroyed through incompetent practices, it's difficult to earn back. Visibility into clinical trial guidelines and results is a step in the right direction to showing competence.

Another step is to listen to your customers and consumers at large. Pharmaceutical companies are often one step removed from the general public, so the pharma company's relationship with doctors is where trust can be built to encourage new patient acquisition. But it shouldn't stop there. Social media and other direct-to-consumer communication channels provide an opportunity for consumers to share feedback. Pharma companies can use voice-of-the-customer and voice-of-the-employee strategies to uncover areas of trust improvements. Don't wait for consumers to speak out. When a company proactively seeks out the chance to improve trust, it becomes more "trustable."

Lastly, we recommend that pharma companies identify advocates among their customers and consumers, and offer them a platform to share their enthusiasm, stories, and experiences. Don't influence what they say, of course, but provide them ample opportunity to spread positive word of mouth about your brand via social media, online forums, internal communications, and elsewhere.

When consumers are in control (which they are), no amount of marketing equals the power of genuine advocacy. Trust-based activities are what build advocates, for the pharma space and in business overall. The industry shows a lot of promise, but it's up to companies and brands to make the most of this strategic opportunity.