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The high-tech brands people know

Forrester Research has come out with a technology brand scorecard. The results may be suprising

If famiarity breeds contempt, from the sound of a survey conducted last fall among 4,700 adults in the U.S., people are really familiar with technology vendors.

Forrester Research’s 2005 Technology Brand Scorecard presented 22 brands and asked for consumers’ level of trust in each.

The most trusted companies were Bose, Dell, Sony, Panasonic and Hewlett-Packard. Toshiba, Hitachi, Microsoft, Gateway and LG were at the bottom of the heap.

The only companies whose trust level increased since 2003 were Apple and TiVo. Interestingly, though, Forrester noted that people increasingly do not associate the Apple brand with its wildly successful iPod.

Forrester believes trust erodes as technolgies move into the mainstream, where they are bought by price-conscious consumers with little brand loyalty.

“Trust is a powerful way to measure a brand’s value and its ability to command a premium price or drive consumers into a higher-profit direct channel,” said Forrester vice-president Ted Schadler. “A decline in trust causes brand erosion and price-driven purchase decisions, which in turn correlates with low market growth.”

This begs the question of what causes a decline in trust, and why companies can be the least trusted, but have the highest market share in a category.

Will people buy from untrusted companies if the price is right, figuring that the product is cheap enough to be disposable if it’s no good? Do they buy because it’s the only game in town?

Forrester didn’t ask respondents for the reasons for their ratings, leaving a lot of questions. What products do people think of when a company name is mentioned? Is HP trusted because of its printers, or across its entire product line? Is Microsoft not trusted only when people consider operating systems? When they think of gaming products or keyboards or mice have they a different opinion?

Apple seems to have a disconnect between its company name and the iPod, which Forrester suggests means that the enthusiasm for the product probably won’t spill over into increased Macintosh sales. That is unfortunate for the Mac, as it turns out, but that sort of crossover is a two-edged sword; if the iPod had been a dud, it wouldn’t have reflected on other Apple products.

Manufacturers place great stock in the value of their brand names. Customers may not know a company name, but they associate its brand names with good or bad experiences. That’s why, when some companies change direction, they change names as well.

If they’re lucky, customers won’t figure it out.

Brand trust may be tied to trust in a reseller as well. If a customer has faith in a vendor, and that vendor recommends a particular brand, the customer is apt to buy it and be firmly convinced it’s the best product available, because a trusted partner recommended it (of course, being steered in the wrong direction a few times can erode faith in both brand and reseller).

Trust is not only a way to measure a brand’s value to its manufacturer, it’s a way to measure a reseller’s value to its customers.