How to Use Trust to Separate Your Business from the Competition
Looking for an edge over the competition? This business model might be the most impactful difference you can make.
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On the heels of Mark Zuckerberg's testimony, Russian meddling in the U.S. election, distrust in government, sexual harassment charges and other corporate malfeasance, our institutions are under attack. One might ask- can companies build entire business models based on trust?
There's an old saying: "Nobody ever got fired for buying IBM." Of course, today if you hired IBM for your back end, you and your Blackberry would probably be tossed out like bad kimchi.
But the thinking still holds today. IBM was such a trusted brand at the time that people gravitated to it as the "safe choice." Today we are desperate for safe choices in how we secure our information, the companies we work for, and who we enter relationships with. Let's face it; people are sketchy, and we are growing more cynical.
I have a client who has leveraged trust for competitive advantage. They sell expert witness services to attorneys using the tagline, "Nothing has more impact than the truth." Believe it or not, many attorneys actually want to find the truth and they rely on this company to deliver it.
Studies have revealed that companies viewed as reliable can command higher prices, even from the most frugal customers who want to know that their business partners will do what they say they'll do.
Here are tips for embracing truth as a business model:
Lead with values
Being a strategy consultant, I am often in the room when values statements are formed, and integrity is invariably one of them. In one instance when honesty was offered as a value, the Sales VP looked straight at the CEO with a cold stare and said, "Well perhaps we should stop lying to our customers."
Creating untrue values statements does more harm than good. Great leaders not only form truthful statements; they reinforce them constantly. They open meetings with examples of people who have demonstrated them. They make sure such values are embedded in the culture, including calling people out privately when they do not exercise them. Posting your values throughout the building as a form of visual management is useful in driving the point home, but your behavior as a leader is what makes them stick.
Be obsessed with reliability
One of my aerospace clients had a 100 percent on-time delivery rating through the first quarter of this year. That doesn't happen by accident. To be the most trusted, a company needs to hire experienced operations people, have great technology and proactively communicate when things go wrong. The devil is in the details, such as having systems in place to make sure your service or product delivery is on time and on point.
I have another client that takes only 25 customers, because that is the number at which they can guarantee flawless execution. Make sure you have relevant, operational key performance indicators, exception reporting, and other tools that allow your team to pivot quickly when service delivery is not met. Everyone should be in the know, and fast.
Build social proof
As I said, we have become a cynical bunch. We'll dismiss a brand in a millisecond if it does not connect with us or prove its value. Companies today are utilizing many forms of social proof including testimonials, case studies, white papers and ratings to prove they are who we think they are. One of my other clients publicly reports his on-time delivery (in real time) on his website to prove his reliability. Look for ways to prove your value, especially when it quantifies performance.
Communicate who you are
Trust is about what we do, and also what we say. I had an ecommerce client miss the delivery of a popular item during holiday season. They got slammed online, but they took action and mailed every shorted customer an apology letter and gift certificate. They flipped the script online, where customers could not believe their level of accountability.
Be sure to communicate your intentions with your customers, and take complete responsibility when things go wrong. It's also a good tactic to take responsibility when things go right, by announcing your activities and problems solved through monthly reporting.
Reinforce your trustworthiness
My client who built a tagline based on truth does even more than that. At the end of every engagement they make a donation to the charity of their client's choice, in the name of that client. What message does this send? It suggests they are not only a company you can trust, but one you'd want to do business with.