Signaling trust in print advertisements: An empirical investigation

Abstract

Trust is a key component of many successful businesses, and while there are many factors in advertising that can aid in establishing trust, this paper focuses on business tenure and local ownership as potential cues of trustworthiness. Additionally we consider industry type as a potential moderating variable. Two studies were conducted. Study 1 examined the use of the statement ‘locally owned and operated’ while Study 2 looked at the length of time in business. Dependent variables were trustworthiness, brand attitude and purchase intent. Ads were created promoting consumer services from both high-trust and low-trust industries. Study 1 found the claim ‘locally owned and operated’ has no impact on attitudes and intentions as compared to relevant control. Study 2, however, shows that length of time in business accounts for differences in consumers' perception of the company and subsequent purchase intent. Consumers use trust as the foundation for making purchase decisions through the reduction of uncertainty. We examine several possible candidates for how businesses might signal trustworthiness. This paper attempts to answer this question by taking two very prevalent phrases in advertising and testing their ability to encourage a higher level of trust in the advertised service and purchase intent among consumers.

Keywords:

• trust
• better business bureau
• advertising
• local
• length of time in business
• risk

Notes

^1. Handyman Connection and Angie's List are two web-based examples.

^2. The St Louis metropolitan area has a population of approximately 2.8 million and extends into Illinois. The St Louis BBB was formerly known as the Better Business Bureau Serving Eastern Missouri and Southern Illinois.

^3. The BBB name and ‘torch’ logo is a common symbol displayed in yellow-page listings, store signage and other promotional communications. BBB policy on such marketing appropriations by firms has, until recently, been uncertain and unevenly applied. The potential for abuse or misrepresentation by businesses is a risk for the BBB, yet many member firms seek to publicize their affiliation or otherwise capture benefits for its membership fees.

^4. This ‘start date’ provides the basis for determining how long the firm has been in operation or what we refer to in this study as business tenure.

^5. Assael (1987), whose work was cited previously, discusses a variety of methods to reduce risk – some ‘marketer controlled’, others ‘consumer initiated’. He observes that marketers may try to provide more or possibly different kinds of information to consumers and that, correspondingly, consumers may seek additional information or increase prepurchase deliberation. It seems clear that advertising might be either produced or processed by the respective parties in their strategies to reduce risk.

^6. The term has been popularized by Richard H. Thaler and Cass R. Sunstein (2008) in Nudge: Improving decisions about health, wealth, and happiness.

^7. A perusal of commercial or business listing in US ‘yellow-page’ directories is illustrative of this point.

^8. Most recently at http://www.bbbmembership.com/news/01-07Top10stats06.pdf.

^9. We are indebted to an anonymous reviewer for this insight and suggestion.