Making a purchase has always involved some level of customer trust.

You trust that the product or service will be as advertised. You trust that the seller will deliver it on time. The seller trusts that you will pay them for their product in return.

In today’s sharing economy, trust has become even more important. The sharing economy – accepting rides on Uber and our homes on Airbnb – insists we rely on the people we do business with. You wouldn’t get in a car with an unsafe driver, or rent your home to someone who might trash it. E-commerce transactions can bring even more uncertainty. There’s no substitute for picking up a physical product in stores before we purchase it. When we shop online, it means we’re trusting strangers to deliver the product as described.

But how can we build our confidence in strangers?

As it happens, we turn to other strangers.

The power of customer feedback and online reviews

Trust is defined as the willingness to be vulnerable to another party, based on the confidence they will do and act as they say. While companies are very good at telling us what they will do through advertisements and marketing strategies, it’s very difficult for us to take their word for it

The problem is that companies, and humans, are self interested. Of course a company would promise the very best service. As customers, we’re wise to that fact, and retain a certain level of doubt that companies are completely honest about their shortcomings.

Instead of trusting everything companies say, we turn to their customers who can speak truthfully about their experiences. If customers have had a bad experience, they are likely to share their experience honestly. In fact, NewVoice Media found that 31 percent of people will post online after a poor experience.

Online reviews build trust exceptionally well. BrightLocal’s 2016 survey found that 84% of people trust online reviews as much as a personal recommendation from friends or family.

Recruiting reviews and feedback

So if you want to win over customers, you’ve got to recruit positive reviews from customers. And not just one or two from friends. 85% of potential customers believe they need to read up to ten reviews to make an informed decision before purchasing. Here’s four tips on how you can recruit reviews to build trust online:

Ask at the right time

While 7 out of 10 consumers will leave a review for a business if they’re asked to, you want to make sure you’re asking at the right time.

When’s the right time? You want to make sure customers have had time to evaluate their experience. For example, make sure the product has been delivered before requesting a review. Otherwise, customers will either forget to return and leave a review later – or worse, leave bad reviews about the long delivery time.

You can also use Customer Thermometer feedback survey as a screening tool for reviews. If a customer rates you highly on your internal survey, make sure to request a public review after they submit. If the customer leaves negative feedback, take the time to respond and follow up after the survey before prompting them for public reviews.

Review in the right place

When you want to choose the best restaurant for dinner, you might visit Yelp or Tripadvisor. But if you’re in the market for a new help desk provider, these review sites wouldn’t give you much information.

Determine what sites your potential customers are looking at when deciding what to purchase. It might be Amazon or on-site reviews for retail, or GetApp or Capterra for software. For apps, iTunes or the App Store would be the perfect place to drive traffic.

When a customer gives a positive feedback rating, direct them to the most appropriate site for your industry. Don’t let them wonder about where to review you!

Don’t stop recruiting reviews

73% of consumers think that reviews older than 3 months are no longer relevant, according to BrightLocal. You can’t just collect a bunch of reviews once and then let them sit there, getting stale. Potential customers want to know the latest information on how your service and product is performing.

Collecting reviews consistently also means you can show how you’re improving over time. If you launch a new product or resolve a common issue, newer reviews will be more positive.

Deal with negative reviews

If you’re actively recruiting customer feedback, you might receive a negative review. It might be tempting to delete them if they are on your own site, and ignore them if they aren’t. But that’s the wrong thing to do.

Customers actually expect to see negative reviews mixed in with the positive. If they don’t, 95% of consumers suspect the company of censorship or faking reviews. In fact, customers value transparency and honesty so much, conversion rates actually improve by 67% when bad reviews are included amongst the good.

Plus, every negative review is an opportunity to show that you’re listening and care about the customer’s experience. Even if you don’t make it right for that customer, potential customers will see your response as a positive thing. Jay Baer and Shep Hyken are strong advocates for responding to every negative review.

Things can always go wrong, but it’s how you respond to unhappy customers that makes the difference.

Displaying reviews

We love displaying some of our favourite reviews on our Happy Customers page. We often add a picture of the customer we’re quoting to show that feedback is personable, and to underline how real it is.

For e-commerce stores, it’s possible to display product reviews right on the product description page. Reading reviews from customers who have similar body shapes and athletic abilities helps Lululemon shoppers identify why a product may or may not work for them. For example, if all bad reviews state that the sleeves are too long, but that’s something you need, you’ll be more likely to try out the product. People trust the opinion of people they identify with.

The more social proof you can provide to potential customers as they evaluate your product, the more likely they are to trust your marketing claims. “Makes my run more comfortable?” they’ll say, “They’ve got 80 other people saying the same thing… must be true!”

And when public reviews aren’t an option?

In many cases, public reviews are not appropriate. For many companies, it doesn’t make sense, or it’s simply not right, to recruit online reviews. This can be due to customer feedback on staff performance, security requirements, confidentiality issues or contractual reasons. For many companies, they simply want feedback they can act on quickly in private, that’s not in the public gaze.

But even if you’re not publicly displaying feedback, it doesn’t mean you shouldn’t seek the feedback in the first place.

It’s still important to collect feedback and respond quickly to customer concerns. In this case, using a transactional feedback method like post-interaction surveys can be a great way to understand what customers think. One-click simple surveys provide all the power of online reviews but without the drama and headaches that can come with them. They give you fast, actionable insight into the customer experience. Incorporating opportunities for feedback at every stage can keep your team laser focused on providing a great service, alongside a great product.

Convincing customers to trust you

Hemingway has said “the best way to know if you can trust someone is to trust them.” Once you get customers in the door, the quality of your product and your service will hopefully keep them around. But getting customers to be vulnerable just that first time can be tough.

This is why we need a consistent strategy for building trust through feedback and reviews. Recruit reviews on the right sites, frequently and you’ll see conversion rates increase. Ignore reviews, or forget to ask for them and see your competition take advantage.

In my view too many people are thinking about Customer Experience tactically.  Or put simply: too many people are thinking of Customer Experience in terms of making changes to the interaction channels.

Being a strategist, I prefer to think strategically and have been looking for a way that helps me to do that when it comes to:

• Attracting and keeping customers; and
• Thinking about, organising and executing Customer Experience.

So how do you attract and keep customers?  And how should you think about (frame) your customer experience efforts?  I assert that the answer to both of these questions is the same: create superior value for your customers and keep doing it continuously.

Which begs the question: what is ‘value’ from a customer perspective?

Fifield: customer value equation

One of the most useful frameworks that I have come across is the one developed by Paul Fifield (by building on some work done by Osterwalder and Pigneur) in his book Marketing Strategy Masterclass.

• Value = Benefit – Effort – Risk – Price

Maz Iqbal: customer value equation

If it was OK for Newton to stand on the ‘shoulders of giants’ I am more than happy to steal from Professor Fifield.  Yet, I believe that Prof. Fifield’s equation neglects a critical piece of the puzzle.  So I have added it in and thus my equation is:

• Value = Benefit – Effort – Risk – Price +/- Treatment

Let’s take a closer at the six elements of this equation.

Value 

The first point to make is that value does not reside in the product or service that you offer.  Value is in mind of the customer.  Put differently, customer value is the value that each individual customer perceives in:

• what you are offering including any implied or explicit promises; and
• getting the job done in the way that you are proposing in your offer.

This means that ‘value’ will occur differently to different customers.  So a customer who is housebound is likely to value the home delivery of their weekly groceries very differently to another customer who is able to and enjoys visiting her local supermarket.

Finally, it is worth stressing that ‘value’ from a customer perspective is much more than price.  And it certainly is not about being cheap.  Recent wine tests have shown that in blind taste tests customers rate the same wine differently: if the wine is priced cheaply then the wine is rated as being of an inferior quality even though it is exactly the same wine in the same bottle!

Benefit

Your offer must promise and deliver the benefits that the customer is looking for.  One way of thinking about this is in terms of the job that the customer wants done and the outcomes he desires.  The closer you offer is to the perfect solution for the job and the desired outcomes, the more benefit it deliver and the more value that you create for your customer.

Clearly, each customer will have a different perception of the importance of the job, the perfect solution and the value of that solution. To make this manageable you must segment your customer base into distinct customer segments.

Effort

Customers have been conditioned to want ease and convenience.   I would go further and say that ease and experience are so important to us that once we have found a supplier that delivers this we stop looking for other suppliers.

The desire for ease and convenience spans the process of finding, evaluating, buying, taking receipt of and using the product or service. This means that the organisation needs to pay attention to more than the product or service.  It needs to pay as much attention to interaction and distribution channels as it does to the product or service.

It is worth noting that real value, from the customer’s perspective, is only created in the usage process.  Too many suppliers neglect to pay sufficient attention to the customer’s actual usage process.  So they fail to come up with solutions that minimise the effort of using these product or service.  This is an area in which Apple has excelled and made its fortune.  Now compare Apples attention to detail (as regards the user experience) to this: How “wrap rage is hurting the customer experience”

As Fifield says “Generally, there will be greater customer value attached to those offerings, where the organisation has spent time, research, effort and insight into finding new ways of making the old jobs easier.”

Risk

The greater the level of risk that the customer sees in you the vendor and your offer, the lower the perceived value of your offer.

The perceived risk is much higher when the customer has a lack of knowledge and prior experience in how best to get his job done.  And in particular how to judge the expertise of the supplier and the quality of the offer.

It is worth noting that risk is always present: usually at a subconscious level.  Customer are particularly sensitive to things that can go wrong and which make them look stupid in their own eyes (self-esteem issue) or in the eyes of others (social standing).  It is the reason that advertising is not dead, will not die and why established brands do well despite doing poorly on other elements of the customer value equation.  We are risk averse and stick with the devil we know;  brand recognition matters – ask anyone who does not have an established brand.

Price

In some ways this is one of the more complex components of the customer value equation.  Why  Because it is not as simple as the price being too high.  From a customer perspective, it cover the following aspects:

• Price being too low (wine example under Value heading) and thus leading the customer to think that the offer is of inferior quality or not fit for purpose (increasing the Risk component of the Value equation);
• Price being too high;
• Seeing the same product cheaper somewhere else;
• Depreciation in value – how fast the resale value of the product will fall;
• The time/effort trade-off in searching for the lowest price;
• Buy now or buy later when price falls etc

Treatment

Treatment recognises that customers are people and as such the place a value in how they are treated as human beings.  Put differently, customers put a high value on ‘service.  In particular, they prefer to do business with organisations that leave them feeling ‘valued’.

I have placed a +/- in front of the Treatment component because if customers are treated well (especially by the employees of the company) then it make a positive contribution to customer value as perceived by the customer.  If the company fails to do that then the Treatment component becomes negative and decreases the value of the rest of the offer.

Two companies that excel in the Treatment component are Amazon and Zappos. Here is an example of the kind of impact this has on the customer:  “Great Customer Service Build your Revenue and Brand: My Amazon Experience”

original article by Maz Iqbal