The Dimensions of Consumer Trust
The idea that data ties the experience and the emotional element of buying together is vital. It’s about moving the consumer’s perception that their data is all to the brand’s benefit, building trust in the data and essentially building those long term customer relationships.
Jonathan Carter of Acxiom notes: “There are two dimensions of consumer trust that need to be demonstrated through the value exchange FROM data exchange”:
Sensible Trust = Credibility/Reliability/Responsiveness = Product/Service Hygiene
Sensitive Trust = Social Nous/Empathy/Intimacy = Emotional Engagement
Sensible trust is the consumer’s expectations of the brand and its use of their data, for example that the company should store and use their data carefully and deliver something back (usually the ubiquitous free coffee, or money off). But the ubiquity of the offers is of course a problem.
Consumers Want To Build Long-term Trust Relationships With Brands
A ubiquitous offer is expected, easy to get hold of and creates little or no long-term loyalty. If the brand somehow fails to honour its side of the bargain, it is very easy for the customer to shut down the relationship, and almost impossible for the brand to win it back.
Sensitive trust is based on an understanding of when, where and how the customer is using or consuming products, then taking that information and feeding it back to the customer in some form of ‘Relevant Utility’.
This is where apps and the IoT deliver that deeper connection through the two-way data exchange.
For example with Fitbit, the user is freely and knowingly telling Fitbit how much they run, walk or climb, how often and where. With its associated app, users are also telling it what they eat and even where they buy their food from. In exchange, Fitbit is telling the user they can go a bit further, run a bit faster – and then rewards them for their efforts with badges. Not a money-off voucher in sight. Indeed, the competitive nature of the product’s users means that the more interaction with Fitbit there is, the more likely a customer is to buy related products such as scales, equipment and other related apps.
As another example, Aviva’s Drive app monitors teens’ driving habits (it can be used for any driver but teens provide the greatest source of concern, and cost, for policyholders) in a way that yes, will provide money off traditionally steep premiums. However, it also makes for ongoing trust not just between brand and user, but also between user and their family.
Having an authoritative source of driving style assessment in real-time and ongoing allows teens to prove their reliability on the road. Far from creating resentment at ‘big mother watching you’, the app allows teens to demonstrate they really can be trusted to take the wheel. Creating family harmony goes far above and beyond the call of relevant utility, creating value and stickiness.
At the moment, the IoT is not as seamless as the predictions suggest it will be. There is a wide variety of networks, often built around specific technologies or need states. They do not all connect to each other to allow the sort of serendipitous journey. The customer can be brought along on the value exchange for data exchange journey as long as that first word – value – is the focus.
A Formula For Long Term Customer Relationships and Brand Engagement
In Econsultancy’s Marketer’s Guide to the Internet of Things, Martin Talks, of 10x Army, illustrates building an IoT project:
- Utility is a vital measure for any solution. Is the proposed solution actually solving a problem that customers have? The IoT will make us a part of the network of interconnected objects and people. This will enable such benefits as ‘persistent identity’ whereby we are recognised and doors unlock, travel is paid for and coffee brewed.
- Entertainment is another compelling reason for people to use any technology. It can push any technology through the resistance that inevitably comes when people have to consider new technologies.
- Participation is a key driver of us all as humans. We want to be part of the herd. We are social animals. The IoT networks us to a wider world of people and objects, creating closer links than ever before.
These factors could be expressed as a formula:
Source: 10x Army via Econsultancy’s Marketer’s Guide to the Internet of Things
While this is a formula relating specifically to wearables and the IoT, it could easily also represent the way for brands to create relevant utility and deliver the value exchange from data exchange.
These elements must be present for the customer to engage with a brand over the longer term and move beyond the hygiene measures of data security and financial incentives.
Acxiom’s Jonathan Carter emphasises:
“The key insight is, in order to minimise a customer’s resistance to sharing their data with a brand, it is the brand’s ‘value exchange promise’ that needs to be consistently delivered over time. The mechanism for delivering it doesn’t need to be consistent – it can be a series of one-off incentives, but they need to be sustained, evolve and ideally they all need to be useful and of interest or relevance to the consumer.”
Utilising Long-term Consumer Relationships Based on Trust
We are moving towards an interconnected future, increasingly driven by IoT but it is by no means perfect yet. Not all interactions will be seamless, not all apps will load, swipe and update as they should. But as long as the value, the relevant utility, is delivered overall, the consumer will build a long term customer relationship with the brand, based on trust.