NEW YORK (AdAge.com) -- Only 8% of American consumers have full confidence in banks and other financial service companies, according to an alarming new study from independent PR shop Waggener Edstrom Worldwide and RT Strategies.
Whether it's all AIG and Bernie Madoff's fault, the entire industry has been painted with the same brush and labeled as greedy and indifferent to the daily struggles of everyday consumers. And part of the problem is that these companies aren't communicating with their customers.
The study shows that most people have either heard nothing from the industry or don't really like what it is they are hearing.
Almost half (44%) of the 1,000 consumers polled between Feb. 28 and March 2 said they have heard something from the industry, either through traditional or new-media outlets, but felt more negative about the industry after hearing it. Another 38% said banks and financial institutions haven't communicated with them at all. A mere 11% said they actually heard something from a bank or financial services company that made them feel better about the industry after hearing it.
"They are clearly in the midst of what has been a fairly negative media environment," said Torod Neptune, senior VP-global public affairs at Waggener Edstrom. "Americans are listening to what banks have to say right now there's just not a lot being said."
Mr. Neptune said the study revealed that there was actually a window of opportunity for the industry to earn back the trust of consumers. That window, however, is closing fast he said.
"It's an extremely hostile environment and it's very unique in the midst of such hostility that consumers are still giving the industry somewhat a benefit of the doubt," he said. "There are actually some pretty hopeful signs here they just need to take advantage of these opportunities."
He's referring to the study's finding that not everyone thinks that the banks and other recipients of federal funds were using that money for bonuses. More than a quarter (28%) of those polled said they felt "banks are using the recently acquired federal funds to make consumer loans," another 23% said "they were using the funds to make business loans" while 27% felt "they were holding the funds in reserve." Only 21% said they thought companies were using those funds to pay salaries and bonuses.
So just who exactly do consumers think is doing the best job of addressing the current financial crisis? An overwhelming majority (69%) believe President Barack Obama is doing more to address the situation, while only 12% think the industry is taking the lead.
Mr. Neptune said he still thinks the industry has a chance to do right the ship.
"The industry hasn't been written off entirely," he said. "But in the absence of their doing something and engaging in some type of dialogue their opportunity is going to disappear pretty quickly here."