What’s in this article:
- We look at where consumer trust is waning, where it’s waxing, and the insights businesses can use to make the most of the shift
Society, markets, and economies all run on trust. So if consumer trust is vanishing, does that spell the beginning of the end of business as we know it?
Not so fast.
The idea of shrinking consumer trust is one of the major misconceptions dominating the cultural zeitgeist lately. During the summer of 2020, brands in virtually every industry either made public statements against racism or apologized for failing to create equitable, anti-racist companies.
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Regardless of whether or not those brands took real action, their statements can be read as attempts to foster and maintain consumer trust. Many met the initiative with skepticism. In today’s world, businesses shouldn’t abandon the idea of consumer trust, they should adapt to a new understanding of the concept.
Consumer trust isn’t disappearing, it’s shifting
Data shows that consumer trust is waning, but certain specific areas. Trust in traditional institutions, government entities, and legacy companies is , but trust in startups is at an all-time high. It’s more accurate to say that consumer trust is evolving, not evaporating. “Trust isn’t going away,” said Anjali Lai, senior analyst at Forrester. “Consumers are shifting who they trust, how they trust, and where those pockets of trusted organizations are bubbling up.”
Many entrepreneurs and scrappy brands can’t leverage the size, reputation, or company history that legacy organizations have traditionally used to signal their trustworthiness, but they do have a knack for telling relatable stories. Startups’ ability to signal empathy and share social values allows them to create deeper and more direct connections.
In contemporary corporate culture, consumers are more likely to root for David than Goliath. Businesses may want to pay attention to how startups create authentic connections and build meaningful relationships with their customers. The more trust startups inspire, the more disconnected customers wind up feeling from larger organizations clearly stuck in the old way.
The bare minimum amount of trust is not enough
Achieving the bare minimum amount of trust to get consumers in the door isn’t sufficient.
The more trust a consumer has in your organization, the more likely you are to retain customers, foster a positive reputation, and continue growing. . Dismissing trust as just another sales lever is a mistake; trust drives consumers’ willingness to forgive, increasing the likelihood that they’ll forgive your organization ifeventually make a mistake, and also increases the likelihood that consumers will advocate for your company and stick with you for the long haul.
Trust is not a one-way exchange, it’s a currency
Consumer trust does not exist in a vacuum; it is based on relationships. Lai and her team at Forrester developed this working definition of the concept: “Trust is the confidence in the high probability that a person or an organization will spark a certain outcome in a relationship — and hopefully a positive outcome in a relationship.”
It’s also important to understand that the many different trust-based relationships businesses maintain are all interconnected. For example, company-employee relationships require trust, and increased employee trust is directly correlated with consumer trust. As consumers’ visibility into company cultures and working conditions continues to increase, they’re more likely to trust companies that treat their employees well and do right by their staff.
Brands must pivot from seeing trust as a bare minimum necessity to understanding it as a currency that’s in play in every business interaction. Because today’s consumers feel empowered to vote with their wallets, they actively seek out opportunities to trust, support, and do business with companies that spark positive outcomes aligned with their values.
In order to build up that currency and inspire consumer trust, explore where your values and your customers’ values overlap, study how your customers’ behavior patterns are evolving, and determine just how much trust your organization needs in order to succeed.