The Value of Trust in the Customer Experience

At a recent Marketing Science Institute conference, Ayelet Gneezy from UC San Diego presented research finding which has huge implications on customer experience. Looking at several “pay-what-you-want” examples, she found that businesses who trusted their customers to do the right thing yielded better business results. For a photo concession at an amusement ride, it was more profitable to ask customers to take the photo and pay what they wanted than to offer it for sale at $12.95. In another case, at a restaurant in Vienna where patrons were asked to pay what they want, customers actually paid more in private than in front of a manager.

In our numerous studies on customer experience, pro-social emotions are repeatedly shown to have a strong effect on experiences and loyalty. Specifically, customers place high value on being treated respectfully and fairly, which makes them feel proud and valued, and in turn, more loyal. Gneezy’s research confirmed that customers will reciprocate respectful treatment with, at minimum, financial rewards. Except for perhaps a small minority, we humans will reciprocate kindness with kindness, respect with respect, and trust with trust.

Do you show your customers that you trust them? Think of the retailer who will take back any item, no questions asked, versus another with strict rules, receipt requirements, expiration dates and restocking fees. Or, consider a corporate press release in which an organization honestly admits to a mistake, versus one written in legal jargon in fear of lawsuits. It’s not difficult to imagine how shoppers will reciprocate, given the underlying messages about trust that are being communicated. It is time for businesses to transform some underlying assumptions about their customers and recognize that if you trust them, they will do the right thing. This is an enormous opportunity for innovation and growth.

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