Q

Two main factors to building trust with customers

Don Peppers explains the two factors that influence a customer's trust in a company.

What are the main factors that impact how much trust a customer has in a company?
There are two essential ingredients to building customer trust. First, a customer has to believe that your intent is to do him no harm, or to act in his interest. And second, a customer has to believe that you have the capability and competence to act on that intent.

Taking these two ingredients one at a time, Charles Green, who wrote The Trusted Advisor, suggests that the more

self-oriented a customer suspects you are, the less he is willing to trust you. If a customer thinks, in other words, that you are conveying a message designed simply to accomplish your own goal of selling him something, then he will not trust you. He may or may not elect to buy in response to your message, but he will make his own decision, because he has judged that your advice is not reliable and it is biased toward your own self-interest. This is why companies increase the trust their customers have in them when they advise a customer not to buy something even when the customer is ready to buy – if the company knows that the customer doesn't really need the product or service. For example, when you get ready to buy a book (or any other product) from Amazon that you've already bought once before, Amazon will warn you that you've already bought this, and ask if you're sure you want to buy another. And if you are all set to buy property insurance for a new house from USAA, the direct-writing insurance company famous for its customer service, the company may actually talk you down from the amount of insurance you thought you needed, if they judge that you don't really need it (perhaps because $100,000 of that $400,000 house price was really for the land, and not the structure).

Clearly, your customer judges your intent by your communications and your actions. And if your intent is simply to "sell, sell, sell" whatever you can get him to "buy, buy, buy," then you won't be earning his trust. Customers can smell the profit on your breath from a mile away.

But the second big ingredient in customer trust is competence or capability. Even if your intent is wonderfully customer-oriented, do you have the capacity and sheer business skills necessary to act on that intent? It does you no good to declare that customers are the "salt of your earth" if you don't have the systems necessary to tell a customer the status of his order, or your call center agents don't have the training required to be able to help customers get what they really want. You undermine trust every time you ask a customer for information he already gave you -- you undermine it with bad product or service quality, shoddy repairs, poor performance and inaccurate invoicing.

So, to earn a customer's trust, you have to:

1. Want to act in the customer's interest.
2. Get the basics right in your business.

These are not "either-or" criteria, but "both-and" criteria.


Hear more in Creating Customer Value, a SearchCRM.com monthly podcast series with Peppers and Rogers.
This was first published in June 2008

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