In my last post, we discussed the ways in which trust, or lack-thereof, could cause some serious issues for your business in the eyes of behavioural economics. This is a pervasive issue facing consumers, 80% of consumers don’t know who to trust because of false advertising, fake news, and contradictory information.
This time we look at how behavioural economics can build brand trust. Although research has found that consumers are more likely to try a new product when it’s launched from an existing brand, showing that there is some level of trust in the marketplace, there’s plenty of room for improvement. Why leave money on the table when behavioural economics can help?
The Power of Free
This is a time-tested way to get someone’s attention – but can it help to build trust too? In the mind of a consumer, trying something that’s FREE has lower risks because there is no money on the line. And it gives you the chance to earn their trust. Here, we encourage you to build trust by offering sample of your product. This can be done effectively in a couple of different ways. Offer a free sample. This not only shows that you are confident in your product but giving something for FREE, it also engages the social norm of reciprocity – where it’s assumed people will return benefits for benefits and repay in kind. Because of this hardwired principle, giving your customer a little gift could prompt them to buy your offering. The act of offering a free sample builds trust in the sense that your customer thinks, “oh hey, they are so confident in the quality of their product they are willing to give me one for free, I guess it must really be good”, and they might trust more in the quality of your product right off the bat. This process might be even more effective when free samples are handed out in person as it mimics the setting of social gift-giving and might tap in to a consumer’s sense of reciprocity. As humans, we have a high need for consistency between our beliefs and our behaviours; having a human distribute a free sample (rather than receiving it in the mail) and gives the product in question the stamp of approve from at least one real life human being, which might help to instill confidence in that product or offering.
Another way to give a freebee is to pair a sample with the purchase of another product. Not only does the word FREE seem to attract more consumers, but by pairing a sample with a brand or product the consumer already trusts, some of the positive associations with that product might rub off onto your new offering. This use of brand extension works both ways – lending trust and credibility to products, or a chance to rebrand if a dark cloud has been cast on your business.
Take Away the Mistrust
Many consumers are weary of the messages disseminated through advertising. With alternative facts and the like, consumers might not know what information to trust. Even if there are online reviews, the same product might not work for everyone and the customer wants to be able to trust their expectations will match their consumption experience. Customers are also all-the-more aware that advertisers appeal to emotions, often foregoing facts. This can lead to customers feeling manipulated and taking a real hit to the trust capital of the brand.
What you can do here is build trust by showing your customer that you understand the sources of mistrust. Do so by giving them the space to form an opinion of their own – risk free. One technique is to offer your customer a no-questions-ask trial period, the way mattress companies Endy and Casper have done with 100 nights for the customer to decide if they want to keep the product. This removes any mistrust harboured against advertising and signals to your customer that you are so confident in the quality of your offering that you are willing to foot the bill for returns on shipping. It suggests that if they don’t want this mattress you better believe another customer out there will. One explanation for why this 100 day risk free returns strategy might be effective is the endowment effect – the idea that people perceive things to be more valuable simply because they own them. An advertisement for a mattress might suggest it’s worth one amount, but the value might go up once it’s in your home simply because it’s yours. Let your customer form an attachment to your product and let that foster your sense of trust.
Appeal to Authority
Often consumers look to their social environment for guidance in making consumer decisions. This appeal to the wisdom of the crowd can be explained by social norms, i.e., the rules of acceptable behaviour in a society. Our social need to look to others when making choices explains why we join in on fads (hipster glasses, anyone?), either reducing the work we put in to really think about our decisions or trying to fit into the group. So, when trying to figure out who to trust, what’s better than looking to see who our like-minded others trust?
Sometimes there are individuals out there – not necessarily tied to the brand – who’s opinion we trust more than just seeing a mother-type driving a Volvo filled with kids. Building trust with your customer can come in the form of engaging these social influencers. Social influencers could be many people: celebrities, scientists, politicians. Endorsement from anyone gives the perception that these people have done the heavy lifting, wading through all the options and consumers could trust them because they are betting their reputation on endorsing a product or service. Say Kim Kardashian endorses a line of athletic-wear, the message implied to consumers is that if it’s good enough for Kim, it’s good enough for us as well. But – be careful, you need to keep your spokespeople accountable. If your endorser has a transgression, even if it’s unrelated (ex. they endorse your cosmetics line but got busted for tax evasion) it could burn the bridges of trust and make your company seem like you have poor judgement. Pick the right endorser and you could end up with a loyal group of customers.
Trust is ever more important in an era where consumers are increasingly dubious. While other firms will lose out, you have the secret weapon: behavioural economics.