As MEC’s comeback shows, Canadians want value in a high inflation environment: report

The 2023 Gustavson Brand Trust Index studied consumer trust in 400 brands across 33 categories.

Credit: Mountain Equipment Company (MEC) Facebook

The 2023 Gustavson Brand Trust Index studied consumer trust in 400 brands across 33 categories

If you started eyeing other streaming platforms when Netflix announced its crackdown on shared accounts, you’re not alone. At least 13,188 Canadians who were surveyed for the 2023 Gustavson Brand Trust Index (GBTI) agree with you: the Netflix decision sucks.  

The GBTI evaluated consumer trust in 400 brands across 33 categories to assess perceptions of reliability, consistency, honesty, social responsibility and integrity. Last year, trust was a massive problem for tech and media companies like Tesla and Twitter, but this year, consumers seemed to be looking for value in a high inflation environment.  

Viewers changing the channel on Netflix is a “problem of [the company’s] own making,” says Saul Klein, current dean of UVic’s Gustavson School of Business. The streaming service—which lost a whopping 25 points in the past year—used to be chill about account sharing, so consumers interpreted its sudden crackdown as a move to change the bargain they had with the brand. However, the move hasn’t affected the company’s rising stock price, possibly because the change hasn’t been initiated in the U.S. yet.

In a similar vein, CTV saw a decline in viewers aged 35 and above. The broadcast network lost ground after facing criticism for potential gender and age discrimination. “It’s a lesson in the risks of trying to change your target market,” says Klein. “While going for a new one, you may actually alienate your old one.” 

Defining “value”

The 2023 GBTI makes it clear that consumers want value across all industries, but how they define it might differ. Value isn’t only about savings, it can also be tied to things like prestige and exclusivity. Four Seasons, for example, ranked ninth overall (tied with Dove and IKEA) and came in as the most trusted brand in the hotel category. Its place in popular TV shows like The White Lotus and Emily in Paris—as well as its promotion of eco-conscious values—checked in well with young travellers, who are likely controlling expenditures in a tough economy by splurging in limited areas. 

Mountain Equipment Company (MEC) and Costco tied as the No.1 most trusted brands in Canada. This is a spot that MEC hasn’t been in since 2020—the outdoor retail brand fell seven points over the past two years and is now finally back to a pre-pandemic score of 55.

Klein thinks that the new owners—U.S. investment firm Kingswood Capital Management—”have spent a lot of effort trying to regain the trust of the traditional consumer base and the results indicate that they’re having great success in doing it.” Its socially and environmentally responsible approach to business didn’t hurt, either.

Costco’s overall high score (and position as the most trusted Canadian grocery brand) is a clear indication of customers looking for value. Costco quickly climbed the ranks from No.3 last year, even as its competitor Loblaws dramatically fell from a score of 43 to 27. “I think that’s on the back of a lot of reports about their profits this last year and I think people have made the interpretation that rising profits are an indication of price gouging,” says Klein. The last time Loblaws scored this low was during the bread price-fixing scandal of 2018. 

WestJet seems to be another brand at risk. The airline has been losing altitude every year since 2017, and its descent is driven by a disconnection from its roots as a scrappy, low-cost carrier. Whereas it once used to hand out Christmas presents to passengers coming off the plane, it hasn’t been able to retain its customers’ confidence. Now the gap between WestJet and other low-scoring airlines on the GBTI (like Air Transat and Air Canada) continues to narrow.

As of this year, it’s safe to say that Canadians don’t trust transportation companies on the back of poor customer service, operational challenges and failure to meet expectations. When push comes to shove, people are seeking value in tough times, and they’re willing to cut costs with brands they don’t trust.