Over the last few months we have heard many sc andals based upon the disappointing discovery of unfounded consumer loyalty and trust. Rigged football matches, numerous athletes taking illegal drugs and more recently the horse meat sc andal. Have you ever been faced with a loss of your customers’ trust in business? If so, or you believe that it could happen in the future, then this post is for you.
The 2013 Edelman Trust Barometer report, published last month, concluded that there are clear signs of a leadership crisis in both business and government. In fact in many recent sc andals, leaders have not helped the situation when speaking out.
For instance, in the current horsemeat sc andal, several food manufacturers confirmed that their beef products did not contain horse-meat, only to withdraw their statements a few days later. What did they think they were doing? Trust is one of the most important elements of purchase and loyalty; it is difficult to win but so much easier to lose, as many companies have recently realised. In the end it comes down to being truly customer centric. Wouldn’t a customer prefer to hear a “We don’t know but we’re checking” rather than a categorical “No” that is replaced by an equally categorical but rather feeble “Yes” a few days, or even hours later.
As Donald Porter, V.P. at British Airways once said:
“Customers don’t expect you to be perfect. They do expect you to fix things when they go wrong”
So why do so many companies have such problems with telling the truth? If you make a mistake, then own up and correct it: your customers will forgive you and forget it. And more importantly, your owning up to the event will confirm their belief that they can trust you in the future. They will continue to buy your products and services with confidence, trusting that they will live up to your promises.
If you pretend that things are OK when they are really not, you are more than likely to get found out eventually. An employee will talk, a government or industry association will run tests and you will be discovered lacking.
With all these sc andals of what one might call dishonesty, touching so many different industries, this seems to be a good time to talk about building, keeping and regaining your customers’ trust. Here is my starter list of five areas to review, but please add your own to the comments below:
Have you already identified the worst possible scenarios that could happen to your industry, your business, your br and? Do you know precisely how you would react in each and every case? When an incident happens it is already too late and the damage has started. By identifying upfront what may happen in each possible event, you have sufficient time to identify potential risks before issues reach dangerous levels.
Another factor of preparedness is to identify and to follow metrics that will provide you with an early warning system. When levels of certain critical elements get close to precise limits, you again have time to react before damage is done. Think about customer complaints, quality rejects, machine down-time, industry legal cases, whether yours or your competitors.
For each critical incident identified, assign jobs to people in all relevant departments. Who will communicate, both internally and externally? Who will adapt and replace sub-optimal products and services? Who will develop and launch new ones?
As with fire drills, exercises of disaster recovery can identify missing elements, whether time, money, or people. These can then be addressed well before they may be needed. No point in wishing you’d bought that extinguisher when the fire breaks out!
As with measurement, engaging your customers, partners, employees and even competitors in building industry trust will ensure that it will survive any crisis. However, at a company and br and level, customer and employee engagement becomes particularly important, since competition is often secretly hoping you will badly manage a negative situation, from which they might then benefit. By keeping communication open 24/7 you are much more likely to be able to respond without delay and in many cases even prevent issues from escalating into a full blown crisis.
If football and cycle team managers had kept to their jobs of management, and trying to be the best they could be without resorting to bribes, drugs or other illegal practices, then the sports would not be where they are today. If food manufacturers had chosen to make food that they would happily give to their families instead of cutting costs to a maximum, then they too would not be facing the current sc andal. Unfortunately, these events damage not only those concerned, but the wider industries at large.
Sports sponsorship will be under much tighter scrutiny and perhaps some br ands will decide to move to other sports or forms of promotions in the future. Sales of prepared dishes containing beef are significantly down in Europe already and this will result in lower prices for wholesalers and eventually also for the farmers. According to Reuters, a recent poll run by Consumer Intelligence in the UK, showed that more than 65% of respondents said they trusted food labels less as a result of the recent incident, so in fact the whole food industry has been impacted.
Luckily, not every industry or company has been doing their business without regard for honesty and living up to their customers’ trust in them. Some companies underst and the importance of winning and then keeping this trust. Ford recently issued a booklet about the Top 2013 Trends of importance to them and their number one trend was trust, or as they quoted it “Trust is the new Black”. In their description of it, they mention that “Correlation of trust to br and equity increased by 35% in three years since the (economic) crisis”. If that isn’t a reason to build trust, I don’t know what is!
For more information about building trust and increasing br and equity, check out our website here: https://www.c3centricity.com/home/engage/
Or why not give us a call to see how we can support your own initiatives in (re) gaining your customers’ trust. No obligation, just INSPIRATION!