Careful When Handling Consumer Trust
I recommend the article Identity & Trust: The Keys to the Game in Winning the Hearts (and Wallets) of the Consumer by Allison Cerra. Allison comes from a telecom background and had an early perspective on the value of what she calls the 3Ps. These are presentation (how a consumer constructs and manages an ideal image of himself), protection (data privacy) and preference (helping a consumer make choices). She speaks of the gold mine of opportunity in targeting experiences and applications for consumers.
Allison argues that trust is an important aspect of who’s services a consumer chooses, and consumer control is an important part of trust. Service providers (e.g. telecos) may not be the most loved, but have earned the trust of consumers.
There is evidence to suggest that the gold can be mined if the user retains control. This may seem like an obvious finding but consider how many privacy policies are buried, unclear or non-existent. Add a lack of usable tools for managing one’s identity, and it’s no surprise many consumers remain wary. However, according to our research, companies that place the user firmly in control will have the best chance at the gold. Even our most protection-conscious individuals in the study - mid-lifers - agree: more than 80 percent are very or somewhat comfortable sharing information about themselves if they have control over who sees it.
Her research confirms the importance of trust as the new currency:
Identity is the new battleground in the war for the consumer. It is no longer “ownership” of the customer that matters, but “ownership” of the coveted trust position that enables new value chains to be created around the user. The degree to which a user trusts a particular brand is strongly correlated to his willingness to pay for a new identity service. (Other factors, such as how much the brand is loved or hated, for example, have virtually no impact on the same.)
For service providers, navigating the trust fault line is the opportunity of the networked age in which we now live. For developers, creating more personalized applications aimed at unique needs unlocks new potential. For advertisers, more effective targeting may finally answer which half of the marketing budget is wasted. And, for consumers, an ecosystem ripe with new value chains and business models is capable of delivering richer services with greater value. The potential windfall is great - but only for those who understand and respect the consumer at the center of the debate. After all, only he can cast the winning vote with his heart, mind and wallet.
All things being equal, and for an educated society, I think Allison is correct. Interesting is that, when applying her lesson to Facebook, Facebook appears to have already squandered any hope of being a key identity provider. Yet when faced with monopolistic power consumers don’t always get to choose who they deal with (as I argue here). This is problematic in new and yet unregulated industries such as social media.
Trust is important and I wish all businesses made it their first priority. It’s also a balancing act and monetization conflict for businesses. Do you play the Rupert Murdoch card and exploit people’s base preferences for market share, or do you take the high (sometimes boring) road of maintaining trust and integrity only to be out sold by the Rupert Murdochs of the world? Do you guard the trust your business has earned, or envy the deals your neighbor is doing and look to maximize your profit as they have? I hope for society’s sake that businesses taking the high road are rewarded and prevail.