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Trust In Business


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Trust In Business

  1. 1. Consumer Trust in Business
  2. 2. Consumer Trust
  3. 3. > Consumer Trust <ul><li>Trust in business is declining </li></ul>Complaints have risen for five straight years, and have now topped more than one million per year Complaints are increasing <ul><ul><li>> </li></ul></ul><ul><ul><li>> </li></ul></ul>Only half of people say they have a great deal or quite a lot of trust
  4. 4. <ul><li>trust? </li></ul>What is
  5. 5. > What is trust? (continued) <ul><li>Trust is… </li></ul><ul><ul><li>> Integrity </li></ul></ul><ul><ul><ul><li>Honesty </li></ul></ul></ul><ul><ul><ul><li>Reputation for being truthful </li></ul></ul></ul><ul><ul><li>> Performance </li></ul></ul><ul><ul><ul><li>Good track record of producing results </li></ul></ul></ul><ul><ul><ul><li>Doing what you say you are going to do </li></ul></ul></ul>
  6. 6. > What do consumers say? Importance of Factors In Trusting Business
  7. 7. > What do consumers say? Attributes of Company MOST Trusted % Who Strongly Agree Statement Describes Company
  8. 8. > Why is this happening? <ul><li>Economic Pressure </li></ul>Cut costs  Improve P&L
  9. 9. > Why is this happening? <ul><li>Economic pressure at the expense of the customer (i.e. bad profits) </li></ul><ul><li>> Poor service </li></ul><ul><li>> Dishonest actions </li></ul><ul><li>> Hidden fees/charges </li></ul>
  10. 10. > Why is this happening? <ul><li>Technology > A loss of social capital – the consequence of society’s increasing disconnectedness – reduces our willingness to trust ( Bowling Alone) </li></ul><ul><ul><li>> Juniper Research projects the number of people using social networks will grow from 14 million in 2007 to a whopping 600 million in 2012 </li></ul></ul>
  11. 11. > Current Media Landscape <ul><li>Nielsen Survey, October 2007, cites the extent to which people trust forms of marketing/advertising, in order: </li></ul><ul><ul><li>> Word of mouth (78%) </li></ul></ul><ul><ul><li>> Newspaper (63%) </li></ul></ul><ul><ul><li>> Online consumer opinions (61%) </li></ul></ul><ul><ul><li>> Brand Web sites (61%) </li></ul></ul><ul><ul><li>> Television (56%) </li></ul></ul>
  12. 12. The Power of Word of Mouth
  13. 13. > The Value of Trust <ul><li>“ Market share is trust materialized.” </li></ul><ul><li>– P&G Global Marketing Officer, </li></ul><ul><li>Jim Stengel </li></ul>
  14. 14. > The Value of Trust <ul><li>Trust = Speed + Cost </li></ul>
  15. 15. > The Value of Trust <ul><li>Total Customer Value = </li></ul><ul><li>Initial Purchase + </li></ul><ul><li>Repeat Purchase + </li></ul><ul><li>Referral Purchase </li></ul>
  16. 16. > The Value of Trust <ul><li>When customers trust you, they are more likely to: </li></ul><ul><ul><li>> Spend more </li></ul></ul><ul><ul><li>> Repurchase </li></ul></ul><ul><ul><li>> Buy additional products </li></ul></ul><ul><ul><li>> Refer you to others </li></ul></ul>
  17. 17. > The Value of Trust <ul><li>When customers don’t trust you, they are more likely to: </li></ul><ul><ul><li>> Cut back on purchases </li></ul></ul><ul><ul><li>> Drive up service costs by reporting numerous problems </li></ul></ul><ul><ul><li>> Switch to the competition </li></ul></ul><ul><ul><li>> Share negative word of mouth </li></ul></ul><ul><ul><li>> Demoralize employees </li></ul></ul>
  18. 18. > The Value of Trust <ul><li>Right vs. Wrong </li></ul>
  19. 19. > What can I do? <ul><li>Path to Sustainable Market Success (Treacy & Wiersema) </li></ul><ul><ul><li>> Operational excellence </li></ul></ul><ul><ul><li>> Product/service differentiation </li></ul></ul><ul><ul><li>> Customer loyalty </li></ul></ul>
  20. 20. > Building Trust <ul><li>Build a customer-centric culture </li></ul><ul><ul><li>> Engage and empower employees </li></ul></ul><ul><ul><li>> Listen and engage customers </li></ul></ul><ul><ul><li>> Put processes in place to measure and monitor performance </li></ul></ul><ul><ul><li>> Take action </li></ul></ul>
  21. 21. > BBB Principles For Trust
  22. 22. > Building Trust <ul><ul><li>> Advertise honestly </li></ul></ul><ul><ul><li>> Tell the truth </li></ul></ul><ul><ul><li>> Be transparent </li></ul></ul><ul><ul><li>> Honor promises </li></ul></ul><ul><ul><li>> Be responsive </li></ul></ul><ul><ul><li>> Embody integrity </li></ul></ul>
  23. 23. > What are we doing… <ul><ul><li>> BBB/Gallup Trust in Business Index </li></ul></ul><ul><ul><li>> Increase customer education (book series, tips, alerts) </li></ul></ul><ul><ul><li>> BBB Advertising Review Services </li></ul></ul><ul><ul><li>> BBB Charity Review Services </li></ul></ul>
  24. 24. Thank you.