Barely half of consumers trust for-profit companies to do the right thing. More than three-quarters of them, however, look to those same firms as sources of social progress.
Those seemingly contradictory findings come from Edelman’s latest Trust Barometer. Published this past January, the study shows 56 percent of American adults trust the business community. But when asked about CEOs’ role in creating social change, at least that many said they expect executives to take action on discrimination and workforce training. Almost as many said the same about whether CEOs should play leading roles in protecting the environment and personal data.
Whether you agree with consumers on those points or not, you can’t deny that their trust is valuable. A study by Interaction Associates, a collaboration consulting company, showed that highly trusted companies are 2.5 times more likely than their low-trust peers to be “leaders in revenue growth.” The reason is simple: If people can’t trust you, they’re not about to do business with you.
Tips for Trust-Building
To strengthen their customer relationships — particularly with their socially conscious customers — executives should commit themselves to three strategies:
1. When in doubt, default to “human.”
Every company has multiple types of stakeholders: employees, lenders, suppliers, customers, and more. Although it’s tempting to see each of them in their business context, doing so ensures they see your company the same way: as a business rather than a group of people. Instead of treating an employee asking for a raise as an additional expense, for instance, realize he or she might be struggling with bills or caring for a sick parent.
Although giving people the benefit of the doubt might sound like a good way to get taken advantage of, the truth is that it’s a smart business move more often than not. When my company, Building Capital, sold an off-plan condominium to a buyer who later needed out of his contract for medical reasons, we canceled it. Only later did we learn that, because we’d treated him as a human being first and a customer second, he referred two buyers to us. The trust we’d extended to him did, quite literally, pay off.
2. Treat trust as the byproduct.
While letting Building Capital’s condo buyer out of his contract built trust with him, that’s not why we did it: We did it because our buyer is first and foremost a human being; medical emergencies happen to every human being. Because we made the decision with the singular goal of helping him out during a tough time, both parties knew it wasn’t some insincere business bet. Our objective was not to generate trust.
As I do, customers and employees often get suspicious when actions are explicitly designed to engender trust. Rather than making trust-building its own goal, recognize that treating people as human beings is its own reward. If you’re curious about the business case behind compassion, though, know that practicing it is a great way to build emotional intelligence. Research by the Center for Creative Leadership shows that emotionally intelligent people are more likely to succeed professionally than those with a high intelligence quotient or relevant experience.
3. Be vulnerable.
The third way company leaders can build trust with customers is almost certainly the toughest. Most executives have spent their whole careers cultivating an air of confidence and control. Unfortunately, those qualities are antithetical to what actually promotes trust. When Google studied the subject, it found that high-performing teams share something in common: psychological safety, or the sense that they won’t be punished for revealing their mistakes. In short, they’re able to be vulnerable with each other.
When a customer gets on the phone with someone at your company, they first see him or her as a salesperson or technician. By sharing appropriate details about their family, mistakes, or aspirations, they can tap into the reciprocity principle. When representative of yours treats a customer as trustworthy, he or she encourages the customer to see him or her — and, by extension, your business — as trustworthy as well.
Building trust with customers has company-specific benefits, to be sure, but it’s also key for society-level change. Without broad consumer trust, the business community can’t tackle the issues that socially conscious consumers think it should. Consumers have to trust that companies’ “responsibly sourced” product claims are true, for example, before they pay more for something that’s functionally similar.
Edelman’s Trust Barometer shows consumers want to trust the business world, but a sizable minority still isn’t on board. It’s up to us — both as company leaders and as human beings — to give them a reason to be.