Trust Recession: AI in Marketing & Advertising

Introduction: The Trust Recession Defined

We live in a world where all the information we could ever need is at our fingertips. We can check just about any fact we need at the speed of typing. This wealth of knowledge should boost our confidence in what we read and hear, right?

Not quite.

We’re entering an era termed The Trust Recession. Consumers are becoming increasingly sceptical of what they see and read online. This scepticism is largely driven by our feeds being flooded with AI-generated content. Younger generations are particularly affected, with over 70% of Gen Z expressing concerns about trusting information generated by AI. This highlights significant trust issues that are becoming more pronounced.

Let's dive into what’s at stake, why the Trust Recession is happening, what it means, and how you can turn it to your advantage.

Why is the Trust Recession Happening?

1. Saturation of AI-Generated Marketing Content

One major reason people are switching off from AI-generated content is the sheer volume produced. Every brand, creator, and even casual users can churn out incredible amounts of content at an unprecedented scale. However, the main problem is:

Most of it is subpar.

There is increasingly little care or attention paid to what is being published. The focus is more on how much can be produced and how quickly. This trend undermines two essential qualities of great content: quality and accuracy. Everything is starting to look and sound the same, as Large Language Models (LLMs) generate similar sets of words in similar orders about any given topic.

This has led to consumer fatigue, where everything you read appears monotonous. It’s like an echo chamber, with an increasing number of voices shouting the same things. It’s enough to give anyone a headache.

Sometimes, more does not equal better.

2. Errors, Inaccuracies, and Hallucinations

With less oversight and original writing, we’re at the mercy of machines. Luckily, these super-intelligent beings can process vast amounts of information, so they can never be incorrect, right?

(Sometimes) Wrong!

Although LLMs are becoming more powerful, they are still susceptible to ‘hallucinations’. This is increasingly prevalent with the rise of AI overviews, exposing normal web users to AI-generated content, whether they like it or not. Approximately 42% of web users have encountered inaccurate or misleading content in AI overviews.

“AI hallucinations are incorrect or misleading results generated by AI models. These errors can stem from various factors, including insufficient training data, incorrect assumptions made by the model, or biases in the data used for training.”

In layman's terms, if they don’t know an answer, they’ll make it up. Ironically, they can create a convincing enough lie that it sounds true, leading you to believe it.

Tricky, eh?

3. Privacy, Data Concerns, and Misuse

You’ve crafted the perfect prompt, uploaded sensitive internal documents, and sent your chat off into the void. But where does that information actually go?

In short, it’s highly unlikely that it remains private. Anything uploaded into an open system is used to continually train the algorithm. This data is theoretically available to everyone else using it. While there are ways to protect your information, like using locally-hosted servers and adjusting certain settings, most of the time, your sensitive information will not stay confidential.

Many companies have opaque policies about how your data is stored and used, in an industry with little regulation.

In short, don’t blindly trust them with information if you want it to be kept private!

Consequences / What’s at Risk

Why should you care about the Trust Recession? If you work for a brand that sells products, or for an agency that collaborates with brands, this is crucial. If your customers lose trust in you, you will lose them.

• Brand Reputation: Once trust is lost, rebuilding it is challenging. This loss is often associated with lower perceived quality and a reduced willingness to buy.

  
  

• Engagement: Readers may disengage, skip content, and exhibit lower click-through rates. This leads to less loyalty and sharing.

  
  

• Purchase Intent / Willingness to Pay Premium: Evidence shows that brands suffer reduced purchase consideration when adjacent content is suspected to be AI-generated.

  
  

• Regulation and Backlash Risk: There is growing government and public pressure for disclosure, which could lead to legislation and tighter standards. There’s also a risk of being accused of “AI-washing” (claiming to use AI without meaningful or transparent application).

  
  

• Internal Risk: Employee morale may suffer if the team is forced to produce low-quality content. This can lead to errors and misinformation.

  
  

Radical Honesty: Turning the Trust Recession on its Head

So, where does that leave us? If consumer trust is in freefall, the instinctive response might be to double down on polish and perfection. Bad idea.

The antidote is called radical honesty. If the name isn’t self-explanatory, check out Ryan Air’s Instagram. Seriously, their social media manager deserves a raise!

Radical honesty goes beyond the obligatory “we value your privacy” slogan buried in fine print. It means being upfront about your mistakes, transparent about your processes, and candid about your limitations. Instead of hiding flaws and hoping nobody finds them, you put them front and centre. It sounds counterintuitive, but data suggests it’s the most effective way to rebuild trust.

Why Radical Honesty Works

Radical honesty works because it does three things simultaneously:

1. It Humanises Your Brand: When a company owns up to its missteps and shows the messy bits, consumers start seeing real people rather than a faceless corporation. This is why real faces and people on social media get more traction than brands.

   
   

2. It Satisfies a Craving for Authenticity: Younger audiences, in particular, have finely tuned bullshit detectors.

   
   

3. It Flips the Narrative: In 2009, Domino’s Pizza launched a brutally candid ad campaign after discovering customers thought their pizza tasted like cardboard. In their own commercial, the company displayed quotes like “mass-produced, boring, bland” and even “microwave pizza is far superior.” The ads bluntly stated, “We admit we screwed up. We’re trying to improve.” U.S. same-store sales jumped by nearly 10%, and Domino’s engineered one of the industry’s most impressive turnarounds.

   
   

Honesty also insulates you from crises. Hiding a data breach or pretending a product defect never happened is a fast way to get cancelled. Being candid about a problem like “our servers overheated; we’re fixing it” may sting in the short term but often transforms anger into empathy.

Some Inspiration for You (What Does Radical Honesty Look Like?)

• Patagonia – “Don’t Buy This Jacket.” On Black Friday 2011, Patagonia ran a full-page ad in The New York Times with the headline, “Don’t Buy This Jacket.” Instead of pushing impulse purchases, they explained the environmental cost of producing the coat and urged customers to consider whether they really needed it. This campaign was linked to a 30% increase in sales the following year, proving that even telling people not to shop can boost business when it aligns with your values.

  
  

• Everlane – Radical Transparency: Everlane built a clothing line on disclosing cost breakdowns. Each product page lists the price of materials, labour, duties, and transport, showing the exact factory where the item was made. This pricing demystifies mark-ups and makes customers feel they’re paying a fair price.

  
  

• Buffer – Open Salaries: The social media tool posts every employee’s salary and shares company performance metrics. This radical transparency turned the brand into a cultural icon and significantly boosted internal morale.

  
  

• REI – #OptOutside: Outdoor retailer REI closed all its stores on Black Friday and encouraged customers to spend the day outside. The message reinforced their brand mission of getting people outdoors and showed that this matters more than revenue, solidifying their positioning.

  
  

The Trust Recession might seem daunting, but it also sets the stage for the most exciting marketing revolution in years. Embrace it.