by Graham Brown
Why is trust important?
Trust impacts the bottom line because it affects the speed at which the organization communicates.
How does traditional marketing view trust?
Trust is so often relegated to the fuzzy end of organizationalanalytics. In fact, it rarely has any measurable substance at all inmarketing.
Because marketers lionize the characteristics that their CEO is rewarded for achieving - namely ARPU and market share. As long as shareholders and analysts use these metrics as best in class benchmarks we can only ever achieve short term results - poor customer service, low customer loyalty, high churn and high marketing overhead.
Trust is the key underscoring of marketing. Consider for example the comparison below, drawn from Stephen MR Covey's excellent "The Speed of Trust":
High Trust Customers
* High propensity to spread the word (word of mouth)
* Low management costs (don't phone up and complain)
* Self-educate or teach each other
* Open to crowdsource new ideas for your products
* High propensity to try out new products and services (cross selling)
* More forgiving of brand mistakes
* More open to dialogue and profiling
Low Trust Customers
* High propensity to spread negative PR
* High management costs (often complain, cause problems, default)
* Need more education
* Low uptake of new products and services (equals higher marketing costs)
* Unforgiving of brand mistakes
* Wary of dialogue and profiling
* High churn (need sweeteners and discounts to stay on board)
Key points about trust
* it's easy for a trusted brand to abuse its presence and turn consumers against it, if the brand takes its relationship for granted (see this example with Disney)
* bloggers are keen to promote brands they trust (see this example with Google), although large established brands such as Google make some naturally suspicious
* brands can easily abuse trust through overzealous marketing or the abuse of trust by their marketing partners (as in the case of Facebook which is suffering from a decline in widget use for this reason.)
* Some marketers see trust as a form of "friendship". It's a useful analogy but falls flat if it is merely a platitude without action. In many ways considering how you market to consumers in the same vein of communication with your friends is a useful reminder.
* Trust is measurable. See my later notes on the 3 Key Loyalty Metrics: Churn, Lifetime Value and Net Promoter Score.
* Building trust with your market is all about organizational trustworthiness rather than educating the consumer. Here are some useful recommendations.
High & Low Trust Brands
Consider then how the following brand fare in their marketing:
* Apple, Jones Soda, JetBlue, Nike, Nokia, Scion, Honda, Threadless, BBC, Diesel, Google, MySpace
and now compare that with their lesser trusted cousins
* Microsoft, BT, British Gas, Comcast, levis, General Motors, Facebook
Resources
* Vodafone presentation on trust
* Focus on trust not technology
* On the street video interviews of youth and trust
* Telenor Djuice presentation on trust
Why is trust important?
Trust impacts the bottom line because it affects the speed at which the organization communicates.
How does traditional marketing view trust?
Trust is so often relegated to the fuzzy end of organizationalanalytics. In fact, it rarely has any measurable substance at all inmarketing.
Because marketers lionize the characteristics that their CEO is rewarded for achieving - namely ARPU and market share. As long as shareholders and analysts use these metrics as best in class benchmarks we can only ever achieve short term results - poor customer service, low customer loyalty, high churn and high marketing overhead.
Trust is the key underscoring of marketing. Consider for example the comparison below, drawn from Stephen MR Covey's excellent "The Speed of Trust":
High Trust Customers
* High propensity to spread the word (word of mouth)
* Low management costs (don't phone up and complain)
* Self-educate or teach each other
* Open to crowdsource new ideas for your products
* High propensity to try out new products and services (cross selling)
* More forgiving of brand mistakes
* More open to dialogue and profiling
Low Trust Customers
* High propensity to spread negative PR
* High management costs (often complain, cause problems, default)
* Need more education
* Low uptake of new products and services (equals higher marketing costs)
* Unforgiving of brand mistakes
* Wary of dialogue and profiling
* High churn (need sweeteners and discounts to stay on board)
Key points about trust
* it's easy for a trusted brand to abuse its presence and turn consumers against it, if the brand takes its relationship for granted (see this example with Disney)
* bloggers are keen to promote brands they trust (see this example with Google), although large established brands such as Google make some naturally suspicious
* brands can easily abuse trust through overzealous marketing or the abuse of trust by their marketing partners (as in the case of Facebook which is suffering from a decline in widget use for this reason.)
* Some marketers see trust as a form of "friendship". It's a useful analogy but falls flat if it is merely a platitude without action. In many ways considering how you market to consumers in the same vein of communication with your friends is a useful reminder.
* Trust is measurable. See my later notes on the 3 Key Loyalty Metrics: Churn, Lifetime Value and Net Promoter Score.
* Building trust with your market is all about organizational trustworthiness rather than educating the consumer. Here are some useful recommendations.
High & Low Trust Brands
Consider then how the following brand fare in their marketing:
* Apple, Jones Soda, JetBlue, Nike, Nokia, Scion, Honda, Threadless, BBC, Diesel, Google, MySpace
and now compare that with their lesser trusted cousins
* Microsoft, BT, British Gas, Comcast, levis, General Motors, Facebook
Resources
* Vodafone presentation on trust
* Focus on trust not technology
* On the street video interviews of youth and trust
* Telenor Djuice presentation on trust
4 comments:
Nice post. Thanks for the link.
Graham,
great post! The trust component and the willingness for brands to be liked or not liked has always intrigued me. Take for example Canada's largest telecommunication company: Rogers!
Noone likes them! Yet they are the only one covering the majority of the country. Very disapointed customers calling in about their bills usually get discounts (~10%). To me it seems like they try to keep customers on the threshold of mid-satisfaction (while charging them more) and will turn the really unhappy customers into loyal ones.
It's a weird way to do business but it makes them richer and richer every day.
Keep up the good work because some of your content is very relevant with my quest to better understand student makreting. Cheers.
Thanks Nic and Morgan for your contributions. Rogers is a good example, mainly because it highlights the whole customer engagement challenge faced by previously nationalized industries.
I guess when you're a near monopoly player (or spring from that culture) you don't need to pay too much attention to trust as consumers don't have any choice in the matter to walk.
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