It’s been said before but it’s worth repeating for brands that are resistant to the growing transparency trend. We live in an information age. When it comes to brand relationships, customers are no longer satisfied with a simple product label — they want to know about the materials with which it was made, where it was produced and the conditions associated with production. Some studies have shown that additional product information inspires trust and loyalty. And truthfully, if a brand does not provide transparency, people will just seek out the information they want. Secrets rarely stay kept, dishonesty is often exposed and brands are held accountable. When this happens, the brand loses control of its narrative. Being transparent upfront allows a brand to shape its own story.
So it makes sense for Amazon, one of the world’s largest retailers, to finally wade into the transparency waters. The brand recently announced the expansion of its counterfeit removal program, dubbed Transparency, which places a scannable barcode on products in the Marketplace, certifying authenticity and conveying a host of other information, from manufacturing dates and locations to other details like materials and ingredients. Response has been mixed, especially with speculation that Transparency participation may end up being mandatory for all retailers.
But Amazon’s stance is more than just PR posturing. Counterfeiting on the site reflects poorly on the Amazon brand and could begin to chip away at consumers’ trust and, eventually, the company’s bottom line. The Transparency initiative is a way for Amazon to say, “We’re on your side,” protecting its customers, its sellers and its own brand image. Those who choose to abstain should be aware of the risk. It could reflect poorly on the retailers that choose, for one reason or another, not to participate and cause customers to wonder why. Do these brands and retailers have something to hide?
Amazon is certainly not the first retailer to embrace honesty as part of its brand identity. Brands that realize the importance of such openness, like the famously honest Patagonia, are taking over the narrative and sharing their stories. Michael Preysman, CEO and founder of Everlane, takes a similar stance, saying, “We stand behind factory transparency and back up the story of each piece of clothing with real data. People are more aware how clothes are made today because of social media, and, as a result, they know what the dark side is. The more information we can provide about our process, the more clear it is to the customer why the decision they’re making is better for the planet.”
Yes, there are risks and costs to transparency. On Amazon’s platform, it’s possible that resellers could have older, legitimate inventory that Amazon won’t accept because it doesn’t have the Transparency barcode. If a brand enrolled in the program gets too many complaints from sellers that can produce legitimate purchase order paperwork, the brand will also suffer by losing accreditation. Of course, there is also the added time and expense of adding transparency codes to all products. Then, there is the potential expense of implementing the codes across the Amazon Transparency app.
But the downsides of keeping dirty secrets are also not to be ignored. In 2015, it was exposed that VW had been deliberately doctoring emissions tests on its diesel cars in the U.S. for the past seven years to claim its cars were low-emission and environmentally friendly. On top of potential fines for false advertising, the company was facing up to $61 billion for violating the Clean Air Act, according to Wired. Suddenly, Europe’s leading brand, in terms of sales, saw the value of used VW and Audi diesels in the U.S. drop by 13%, according to Kelley Blue Book.
While we have technically “recovered” from the financial crisis, widespread skepticism still lingers. People are tired of feeling like they’ve been tricked; that they need to read the fine print or suffer the consequences. They’re tired of having integrity and trust be a differentiator rather than the norm. Honesty backed by transparency can be the antidote to this skepticism and a way for brands to earn consumers’ trust.
Brands can better embrace transparency by making it a pillar for the entire business, not just marketing. They can commit to being clear and straightforward in communications, internal and external. They can commit to addressing misconceptions head-on, owning up to mistakes and weaknesses and admitting that nobody, including themselves, is perfect. They can commit to providing the facts and letting people make informed decisions, helping people get to know the people and process behind the product.
I’m not sure what the next frontier is, but transparency seems likely to become a must-have for all brands rather than a point of distinction for a few.