Costco is Canada's most trusted grocery brand beating out Loblaws

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Canadians’ trust in big brands has waned amid soaring prices, but Costco has cut through the inflation fatigue, according to a new report.

The University of Victoria released the annual Gustavson Brand Trust Index (GBTI) on Wednesday revealing Canada’s most trusted brands for 2023 across a variety of industries.

Costco didn’t only come out on top, tying for the most trusted brand overall alongside MEC (Mountain Equipment Company), but it was also named the most trusted grocery chain in the country.

“The two brands’ commitment to value-driven offerings, customer service, and competitive pricing has resonated with consumers searching for affordability in the face of inflation,” said Saul Klein, dean of the Peter B. Gustavson School of Business at the University of Victoria, in a statement.

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Fellow supermarket giant Loblaws didn’t even come close. It ranks 304th overall in trust, dropping 17 points from the previous year.

The study says this highlights “the challenge [Loblaws] faced in demonstrating value while it reported high profits.”

“As food prices continue to rise, the need for transparent pricing practices, accountability, and swift resolutions grows more pronounced,” reads the report. “Canadians seek reassurance that their grocery retailers prioritize fairness and consumer well-being amidst the challenges of inflation.”

The mistrust in the grocery chain is clear as thousands of Canadians call for an investigation into Loblaw Companies LTD for “profiteering and greedflation.”

In contrast, the study says that the response Costco provided to customers amid trying times serves as an excellent example for other grocery retailers to follow.

“By providing good value and maintaining consumer trust, Costco is shaping the future of the grocery landscape and reaffirming the crucial role of affordability and transparency in rebuilding and maintaining trust with Canadian consumers,” reads the report.

In the chart below, you can see how Loblaws fairs against Costco in a variety of categories like brand authenticity, advocacy, and trust.

Gustavson Brand Trust Index

The only other grocery chain that made it into the top 50 most trusted brands in Canada is IGA.

Other wins and misses

Toyota takes the cake for most trusted brand in the automotive category while trust in Tesla dropped sharply.

“After Toyota faced its own challenges a few years back with a series of recalls and negative media coverage, the company has managed to turn things around,” reads the report. “Its electric and hybrid vehicles have been consistently rated among the most dependable on the road, and the company has a long history of putting safety and quality first.”

The study attributes Tesla’s decline to CEO Elon Musk’s controversial antics.

Home goods store IKEA went up in ranking to ninth place, tying alongside Dove and Four Seasons Hotels & Resorts.

Gustavson Brand Trust Index

Last, but certainly not least, the GBTI found a “concerning reality” for CTV, Canada’s largest private television network.

The study reveals “a significant, and continuing, decline in trust among viewers in the 35+ age group over the past five years.”

It says this was influenced by the abrupt ouster of former CTV National News anchor Lisa LaFlamme.

“The decline in trust also underscores the need for CTV to take immediate action to regain the confidence of its viewers,” the report explains. “Transparency and a commitment to open dialogue are paramount in rebuilding trust.”

And it probably doesn’t help that CTV owner recently Bell Media slashed 1,300 jobs and closed six radio stations drawing the ire of many Canadians.

Gustavson Brand Trust Index

This year, GBTI featured 406 national and global brands across 33 categories. The survey was conducted between January and April 25, 2023. Over 13,000 Canadian adult consumers aged 18+ were surveyed.