The wider collapse in customer trust means opportunities for innovative businesses that come up with ways to rebuild it, writes Will Higham
I speak at a lot of conferences and that means I’ve watched a lot of fellow speakers recently. One in particular – Ron Johnson, who, like me, addressed the Financial Times Future of Retail Summit last month – got me thinking about the value of two-way trust.
Johnson was instrumental in developing the Apple Store and owns a new technology retail company called Enjoy, whose staff actually set up the products for customers in-home. Both projects are innately customer-centric. There’s no time limit imposed on customers at Apple’s Genius Bar – nor on the time Enjoy staff spend setting up. The process only ends when it’s completed to the customer’s satisfaction.
Chatting to the chief financial officer of a major global retailer at the same conference, I discovered they also have a customer-centric policy: no-questions returns up to a year after purchase. Johnson and the CFO both acknowledged that, yes, some customers might take advantage of their policies and it can drive up short-term wage costs. But both claim the benefits for long-term loyalty and positive word of mouth – increasingly important in today’s commercial environment – far outweigh the costs.
The global retailer, for instance, can now rely on reputation, not advertising, to drive growth. According to Forbes, Apple Store generates more revenue per square foot than any other US physical retailer.
One of the biggest problems B2C businesses face today is a collapse in customer trust and loyalty. But too often, attempts to rebuild these are based more on benefits to the brand than the consumer.
But trust breeds trust, loyalty breeds loyalty. For the customer to trust your brand, you need to show faith in them. Yes, if you create a genuinely customer-focused benefit, some may enjoy a free ride. But the majority will respect, support and recommend you for it.
To win back the hearts and wallets of their customers, tomorrow’s brands must offer such two-way trust. Creating products and policies focused on customer benefits – even if they cost more in the short term – will bring real financial benefits in the long run.
Will Higham is a popular speaker and founder of strategic consultancy Next Big Thing