Certain business concepts float around without much evidence to back them up. For instance, every business owner will tell you that customer trust is incredibly important, but what evidence actually links customer trust to the bottom line?
Our Most Engaged Customers (MEC) study for 2010 provides compelling evidence that customer trust is indeed key in business success. After surveying more than 5,000 consumers and 1,200 B2B decision-makers, we studied the brands with the highest Customer Engagement levels to learn what they were doing right, and how other companies could achieve high Customer Engagement. Trust, it turns out, is a main ingredient in building Customer Engagement. And, as this and previous MEC studies have shown, Customer Engagement directly correlates to profit levels, ROI, and share prices.
To provide context, customer trust is the fourth level of the “pyramid” of Customer Engagement. The 2010 MEC study uncovered six traits that add up to Customer Engagement, each of which builds upon previous characteristics. For instance, the first layer of the pyramid is a unique offer—a product or service that customers can’t find elsewhere. Customer care and consistency are the second and third requirements; they earn a brand customer loyalty. However, without trust a brand cannot move from customer loyalty to Customer Engagement. The MEC study uncovered two general types of trust. Some winning brands, we discovered, never give customers a reason to doubt their dedication. Flawless service delivery is the first method of creating customer trust. This route to trust requires perfectly consistent customer care while delivering a compelling offer.
However, it is unrealistic to expect any company to be 100% flawless. Even the world’s top brands make mistakes from time to time; what distinguishes top brands is how they handle problems. How you respond to a customer’s complaint or problem will determine your customers' trust levels. In fact, the highest levels of customer trust are found among consumers “who have had problems and experienced positive problem resolution,” as the 2010 MEC study states. On the other hand, when customers experience poor problem resolution, they are less confident that the company will be able to handle problems in the future. In other words, trust is built when the organization is put to the test, as the MEC 2010 report emphasizes.
A quote from a Costco customer exemplifies the kind of problem resolution that builds trust and contributes to overall Customer Engagement: “Whenever I have had any type of problem or issue with any products I have purchased from Costco, they will always take the product back for either full refund or replacement. No problem.” As this customer feedback implies, when companies properly handle slip-ups, customers don’t even see them as problems. High customer trust levels are earned when companies provide flawless service delivery, or effectively resolve any flaws that do occur.
To understand where your business makes mistakes, you must have a customer feedback system in place. Even the earliest studies of customer satisfaction showed that most customers won't willingly complain; they're more likely to just take their business elsewhere. A strong, consistent feedback system, like our Customer Engagement Management solution, ensures that you discover your own mistakes so that you can quickly resolve them to build customer trust and Customer Engagement.
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