Main takeaways: - Trust is as elementary a problem for marketplace companies as is balancing Supply and Demand. - There are two types of Trust that companies need to solve for - Intrinsic (trust in the marketplace itself) and Extrinsic (trust in the players on the marketplace). - Companies such as Airbnb, eBay, Etsy, Uber have solved for the above two through various products and features that form the backbone of their product experiences.

1. www.productschool.com
How Marketplace Products Build
Customer Trust by eBay Sr PM

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5. Ritwik Verma
Sr. Product Manager, eBay

6. About me
Early career - IT consulting Transition - Product Management Interests - Theater, Creative writing
Ritwik Verma

7. Agenda
1. Understanding an online marketplace
2. Trust challenges for a marketplace
3. Two types of customer trust
4. Intrinsic trust
5. Extrinsic trust
6. Conclusion

8. Understanding
an online marketplace

9. Conventional e-commerce company
E-commerce company Consumers
Payment
Goods/Services

10. Typical e-commerce marketplace
Online marketplace Consumers
Payment
Goods/Services
Payment
Providers

11. Most e-commerce transactions
happen through these four steps
DISCOVER
ORDER
EXPERIENCE
SAFEGUARD
The DOES framework

12. DISCOVER
ORDER
EXPERIENCE
SAFEGUARD
E-COMMERCE COMPANY ONLINE MARKETPLACE
Limited/controlled selection Variety
Standard Flexible
Consistent Variable
Direct control Indirect control

13. Trust challenges for a
marketplace

14. First principle of trust
Trust Certainty
Trust in
e-commerce
Certainty of a
successful
transaction

15. Which one provides buyers more
certainty - company or marketplace?

16. E-COMMERCE COMPANY ONLINE MARKETPLACE
Limited/controlled selection Variety
Standard Flexible
Consistent Variable
Direct control Indirect control
DISCOVER
ORDER
EXPERIENCE
SAFEGUARD

17. Two types of trust

18. What makes people trust something?
DELIBERATIVE
REASONING
ASSOCIATIVE
REASONING
Logical
Data-oriented
Intuitive
Feelings-oriented

19. Types of trust in a marketplace
EXTRINSIC TRUST INTRINSIC TRUST
Trust based on
visible signals and
data
Trust based on
experience and
perception

20. INTRINSIC TRUST
I trust this based on my
perception, experiences
& Airbnb’s reputation
EXTRINSIC TRUST
I trust this because of
the data displayed

21. Types of trust in a marketplace
EXTRINSIC TRUST INTRINSIC TRUST
Trust on the
providers
Trust on the
marketplace

22. Types of trust signals

23. Objective trust signals - data based
Order
Acceptance rate
Cancellation rate
Delivery time
Discover
Communication quality
Response time
Experience
Safeguard
Buyer issues reported/resolved
Resolution time

24. What happened during a transaction?
Online marketplace Consumers
Payment
Goods/Services
Payment
Providers

25. Subjective trust signals - feelings based
User feedback/review
Detailed feedback or review in words for the provider to elaborate on the subjective rating.
User Ratings
A subjective rating (based on emotions) on a scale (e.g. 1-5) on the provider, item or sub-parameter
related to the experience.

26. Building intrinsic trust

27. Primarily, three methods are used to build...
INTRINSIC
TRUST
(Trusting the marketplace)
Managing performance
All providers must meet a minimum performance criteria or
face consequences
Top performers are rewarded/incentivized
Protection policy
All consumers are protected through a dispute/refund policy
Intermediation
Aspects of customer experience are intermediated by the
marketplace/third party

28. A comparison of intrinsic trust products
Managing provider
performance
Protection policy
Intermediation eBay Authenticate Airbnb verified
Uber vehicle
inspection
Seller levels
Top Rated
Above standard
Below standard
Host levels
Super host
Experienced host
Uber Pro
Diamond
Platinum
Gold
Blue
eBay Money Back
Guarantee
Guest refund policy Uber help - Refunds

29. Building extrinsic trust

30. Primarily, two methods are used to build...
EXTRINSIC
TRUST
(Trusting the provider)
Display trust signals about the product/service
Show trust-enabling signals - customer reviews, demand, etc.
Display trust signals about the provider
Show trust-enabling signals - customer ratings, experience, etc.

31. A comparison of extrinsic trust products
Details about
product/services
Details about
provider
None!
None!

32. Do marketplaces need extrinsic trust signals?

33. Intrinsic trust is more valuable
EXTRINSIC TRUST
Trust based on visible signals
and data
INTRINSIC TRUST
Trust based on intuition and
perception
“When making decisions involving risk, such as an online purchase from a website,
consumers tend to rely more on intuition than on deliberation.”
Harvard Business Review: How Customers Decide Whether to Buy from Your Website

34. Conclusion

35. Takeaways
Marketplaces should aim for Intrinsic trust over extrinsic
trust.
Extrinsic trust is important when providers are
heterogenous or specialized
Intrinsic trust can be increased through intermediation,
performance management, and buyer protections

36. Thank you

37. www.productschool.com
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