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Speaker 1: Welcome to Fear and Greed Q and A, where we

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Speaker 1: ask and answer questions about business, investing, economics, politics and more.

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Speaker 1: I'm Michael Thompson, and good morning, Sean Aylmer.

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Speaker 2: Good morning Michael, and good morning to you.

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Speaker 1: Adam Lange.

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Speaker 3: Hello Michael, and hello against Sean.

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Speaker 2: Hello Adam.

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Speaker 3: Today it is all about trust.

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Speaker 1: We touched on this yesterday in the weekend edition and

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Speaker 1: I thought it was worthy of another conversation because it's

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Speaker 1: a big issue. This week we saw the most trusted

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Speaker 1: and most distrusted brands announced by Roy Morgan. Every year

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Speaker 1: they do this survey and I think the findings are fantastic. Right,

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Speaker 1: just for context, the most trusted brands Bunnings, Aldi, Kmart, Apple, Toyo,

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Speaker 1: To Big W, Commonwealth Bank, Mayer, HM, Australia Post and

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Speaker 1: JB Hi Fi. The other end of the scale, the

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Speaker 1: most distrusted brands at Woolli's Cole's, Meta, Facebook, Optus, Quantus, TMU, Telstra,

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Speaker 1: Tesla X formerly Twitter and News Corp. I find it

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Speaker 1: there's there's so many extraordinary things in here, but I'm

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Speaker 1: going to ask you first, Adam, starting with the most trusted,

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Speaker 1: how hard is it to actually build trust as a

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Speaker 1: company and you just take it away. Sean and I

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Speaker 1: are going to turn our MIC's off and go and

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Speaker 1: have a cup of tea.

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Speaker 3: I think it's extremely hard. I mean, it starts with

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Speaker 3: having a very clear and distinct brand, and then you've

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Speaker 3: got to prove it every single time you interact with

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Speaker 3: a customer. So I think it's the compounding story of many,

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Speaker 3: many interactions with customers, and I think that's probably what

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Speaker 3: makes Bunning so impressive.

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Speaker 1: Yeah, yeah, what did you think, Sean? I mean, you're

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Speaker 1: a Bunning's user, You're an elder user. Is there a

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Speaker 1: reason why you keep going back to these? Do you

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Speaker 1: trust them? Do you trust them more than you trust Woolies?

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Speaker 2: Though, well, on my third visit within the same hour,

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Speaker 2: I do trust the Bunning skuy that I keep going

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Speaker 2: back and returning to stuff that I got wrong to

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Speaker 2: begin with. I mean, what I find really interesting with

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Speaker 2: these surveys, the distrusted brands are basically brands who have

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Speaker 2: had a crisis. Wullies, Coals, Optus, Quantus, Tesla x TMU

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Speaker 2: I suppose to throwing there. Telstra is an interesting one.

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Speaker 2: I don't know whether that's a customer servicing or something

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Speaker 2: going on there. So the distrusted brands what I'm interested in. Fact,

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Speaker 2: Adam would love to hear your take on it. With distrust,

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Speaker 2: it's almost like a crisis. You suddenly go from you know,

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Speaker 2: an eight out of ten to a two out of

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Speaker 2: ten and just seems so difficult to start climbing up

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Speaker 2: that ladder again.

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Speaker 3: It really is. And I think, look, if you look

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Speaker 3: in that list of distrusted brands, you can see almost

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Speaker 3: a work in progress by Quantas. So what I mean

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Speaker 3: by that, if you take Coals and Woolies and the

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Speaker 3: pricing inquiry, I think that did enormous damage to both brands.

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Speaker 3: Then you have Quantus and we know very well storied

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Speaker 3: of issues with baggage handlers, with canceled flights, with charging customers.

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Speaker 3: That there was a number of stories in the last

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Speaker 3: five years of how that brand has been damaged, and

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Speaker 3: in the last year perhaps a little bit more. That

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Speaker 3: story is a work in progress. They're working their way back.

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Speaker 3: New planes just arrived this week. Oh sorry, a new

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Speaker 3: plane just arrived this week. As part of rebuilding, in

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Speaker 3: reinvesting in the brand, we've seen obviously they've had to

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Speaker 3: settle the case with those baggage handlers that they terminated unfairly.

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Speaker 3: They're working hard to rebuild with customers, lots more communication.

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Speaker 3: I think we're all frequent flyers and I'm receiving a

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Speaker 3: lot of communication about the work they're doing. So I

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Speaker 3: think you're right, Sean. I think it does really get

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Speaker 3: started the distrust with an event, and then it's over

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Speaker 3: to the brand as to how they work through it.

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Speaker 1: Can I ask you then, Sean? But based on that,

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Speaker 1: how impressive is it? Then? The Commonwealth Bank is in

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Speaker 1: the top ten most trusted brands. It's coming in at

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Speaker 1: number seven, and I think it's up like five places

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Speaker 1: since last year to have recovered from its own crisis.

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Speaker 1: Being part of the banking Royal Commission. What's that seven

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Speaker 1: eight years ago?

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Speaker 2: It was twenty nineteen. But I think this highlights Adam's point.

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Speaker 2: All the banks did better this time. Commonwealth Bank, certainly

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Speaker 2: from memory, Westpac and ain Z were both around the

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Speaker 2: I think one was nineteen, one was twenty one. Ain

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Speaker 2: Z still a fifty one, so not doing so well.

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Speaker 2: But six years ago we had that Royal Commission, and

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Speaker 2: that's how long it's taken for Commonwealth Bank, which really

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Speaker 2: is an incredible brand to break back in or break

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Speaker 2: into the top ten. So it just shows how much

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Speaker 2: damage things like the Optus outage will do to that company.

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Speaker 2: You've mentioned Woolies and Coals in that. How much damage

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Speaker 2: Elon Musk has done to Tesla because of his association

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Speaker 2: with Donald Trump? How much Quantus was another good example.

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Speaker 2: You know, it's taken come of think six years to

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Speaker 2: recover in terms of trust and so it really is

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Speaker 2: a long slow process. And Commonwealth Bank, you know, it's

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Speaker 2: been of the large caps just about the best performing stock.

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Speaker 2: You know, you have all sorts of good news out

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Speaker 2: of Commonwealth Bank all the time. It's only now back

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Speaker 2: into trusted brands.

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Speaker 1: In that case, do you think Woolies and Coals it's

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Speaker 1: going to take some time to get off the bottom

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Speaker 1: of the of the list, and they're trying this year

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Speaker 1: we've had essentially a price war. They've spent a fortune,

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Speaker 1: led by Woolies trying to slash prices in order to

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Speaker 1: rebuild that trust. But it doesn't seem to be working.

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Speaker 1: What are they going to need to do?

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Speaker 2: I think it just takes time. Funny thing is I

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Speaker 2: reckon Willies and Coals are totally trustworthy now because of

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Speaker 2: what they've been through, and so I actually believe what

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Speaker 2: Willis and Coals are saying, but it just takes time

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Speaker 2: to get there. The flip side to that, right, Bunnings

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Speaker 2: fantastic advertising. You feel the service is good. I'm not

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Speaker 2: sure that Bunnings prices are always cheaper. I mean they

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Speaker 2: might be, but I'm not sure. But I actually reckon

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Speaker 2: Willis and Coals are the distrusted brands are ready. They're

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Speaker 2: doing everything they can, more so than Bunnings because Bunnings

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Speaker 2: has got so much political capital at the moment, it

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Speaker 2: actually has room.

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Speaker 1: To move out of directing. Companies pay attention to this directon.

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Speaker 1: They kind of watch this to say, oh, are we

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Speaker 1: climbing the ranks? Are because there is a value to it, right,

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Speaker 1: There is actually a value to companies to be on

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Speaker 1: or to be seen as trusted.

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Speaker 3: Oh yeah, look, I directly know many of the companies

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Speaker 3: do pay attention to it, and so I believe that

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Speaker 3: everyone does and they should. I really have a it's

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Speaker 3: a great question of you know what the value of

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Speaker 3: it is, like does it affect turnover? And I think

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Speaker 3: it does, but not on a sh short term basis.

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Speaker 3: So I think Woolies and Coals, I still shop there right,

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Speaker 3: and so I'm still trading probably just as much with

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Speaker 3: those brands as I used to. So even though I

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Speaker 3: feel differently about it, I'm still trading with them because

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Speaker 3: it happens to be the best option for a set

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Speaker 3: of reasons. But when I think about too, just on

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Speaker 3: that the Coals and Woolies, They've also had a number

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Speaker 3: of things with supplies, you know, dairy farmers for a while,

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Speaker 3: you know, the one dollar a liter milk that really

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Speaker 3: challenged a lot of people, and that was very heartfelt

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Speaker 3: to many and probably very memorable like that can scar

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Speaker 3: over time. Other agricultural providers, Woollies and Coals have really

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Speaker 3: been very aggressive competitors and have negotiated hard with those,

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Speaker 3: sometimes too hart like a lot of farms have had

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Speaker 3: to close for it.

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Speaker 2: So the cheesemakers Adam blissed other cheesemakers very.

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Speaker 3: Good, Yes, blessed other cheese wagons. I'm just wondering it's

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Speaker 3: not just customers, it's suppliers as well, and your partners.

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Speaker 3: So I think it does affect trade, not in the

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Speaker 3: short term, but I also wonder, and this is probably

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Speaker 3: an overreach but Commonwealth Bank being so highly valued as

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Speaker 3: a bank, like it's training at world class highs in

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Speaker 3: terms of a profit multiple? Is it because they've just

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Speaker 3: done so many things so well over time. And I

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Speaker 3: think that that's a real hypothetical. But I don't think

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Speaker 3: it affects it in the short term.

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Speaker 1: Okay, we are out of time. I will just point

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Speaker 1: out that looking at the most trusted brands, it's just

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Speaker 1: trying to figure out where Fear and Greed would fit.

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Speaker 1: I think somewhere in between Aldi and Kmart as a

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Speaker 1: trusted brand, and I was a little bit in sense

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Speaker 1: that we weren't on there. I was pleased to say

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Speaker 1: that we weren't on the most discs.

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Speaker 3: Or could we have a Fear and Greed index create

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Speaker 3: our own line?

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Speaker 1: I like that, Yeah, I think. But anyway, somewhere in

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Speaker 1: between Aldi and Kmart would be feels like the right

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Speaker 1: spot for us. Okay, thank you very much, Sean, Thanks Michael,

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Speaker 1: thank you, Adam, thank you BG you sure Now remember

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Speaker 1: if you've got a question that you'd like to know,

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Speaker 1: then send it through on LinkedIn, Instagram, Facebook, or at

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Speaker 1: Fearangreed dot com dot au O Michael Thompson and this

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Speaker 1: is fear and greed q and a