In a dramatic shift, Australians’ trust in supermarket giants Coles and Woolworths has nosedived, marking the worst reputational damage seen in seven years. A recent Roy Morgan survey reveals that Coles, which was once the country’s fifth most trusted brand in December, has now plummeted to the ninth most distrusted by March. Woolworths has similarly fallen from being Australia’s second most trusted brand to the 34th position.
Roy Morgan’s chief executive, Michele Levine, highlighted the severity of this reputational crash, noting that it’s the most dramatic decline tracked in the past seven years. The drop in trust coincides with a parliamentary inquiry into supermarket price gouging during the ongoing cost of living crisis, where Coles and Woolworths have faced accusations of profiteering. Despite Coles posting a $1.9 billion profit and Woolworths $1.62 billion in the last financial year, the price of food and non-alcoholic beverages surged by 4.4 percent in the year to January.
Levine emphasized that this reputational damage starkly contrasts with the trust these supermarkets garnered during the pandemic for keeping stores open and safe. She warned that both giants are now paying the price for not addressing the cost of living as a “genuine crisis.” While their checkout performance remains strong, Levine pointed out that trust and distrust are “lead indicators,” foreshadowing future outcomes. Woolworths’ share price has already dropped by 22.5 percent since mid-June last year, highlighting the fragility of distrusted brands. This creates opportunities for competitors like Aldi and other overseas brands.
Roy Morgan’s monthly survey of 2000 Australians measures trust and distrust across 1000 brands in 26 industries, providing insights into consumer sentiment and market dynamics.
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