by John I. Todor, Ph.D., Author of Addicted Customers (www.AddictedCustomers.com)
“Our study found that
if respondents lose trust in a company, they are highly likely (70% to 80%) not
to purchase its products or services. Worse, people do not simply internalize
their doubts; they talk to others and spread distrust—with up to 33% now using
the web to post their views.” 2006
Edelman Trust Barometer (www.edelman.com/news).
Trust is not just a good
product at a good price. Trust is an indication of the strength of the
relationship between the two parties—the customer and the company. It is an
indication of the extent to which both parties see the relationship as win-win.
Now here is the thing that should really catch the attention of many companies.
Companies that focus on making the sale by offering discounts and incentives
are encouraging customers to take an adversarial position, a win-lose stance
that is inherently distrustful. Trust doesn’t have a chance to develop.
Losing trust in a company
doesn’t require the company to be overtly distrustful. All that needs to happen
is that the customer perceives they are playing a zero sum game, at their
expense.
Many business leaders
bemoan the lack of loyalty in customers. Well, if you want loyalty you need to build
trust, and you can’t accomplish this if the focus is on the product. Trust
develops through the customer experience and that includes the experience in
buying and using the product.
Now consider the
implication of a second Edelman finding.
“In the US, for example, the ‘person like yourself or your peers’ was only trusted by 22% of respondents as recently as 2003, while in this year’s study, 68% of respondents said they trusted a peer. Contrast that to the CEO, who ranks in the bottom half of credible sources in all countries, at 28% trust in the US.”
Here’s my take on this.
Most CEOs are not viewed as trustworthy because customers suspect a one-sided
agenda. Enron and other companies have not helped change this perception.
Peers, on the hand, are peers or friends because there is in fact a
demonstrated relationship. One reason they are perceived to be trustworthy is
the earned trust reflected in the relationship. A second reason is that peers
base recommendations or endorsements on their customer experiences with the
products and companies in question. Their customer experiences have more
validity. They represent the context within which the prospective customers
will be making their judgments.
Check out my new book Addicted
Customers (www.addictedcustomers.com)
for a comprehensive treatment of the evolution of trust in customer
relationships.
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