It seems fundamental: Any relationship with a consumer should be based on trust. How can a business hope to market effectively if its audience doesn’t believe a word it says? This may seem like common sense, but some companies seem to feel trust is an afterthought.
Consider the results of a new study from McKinsey. Not surprisingly, it found that one of the major impediments to online marketing and e-commerce in general is the lack of trust. In particular, it noted that the vast majority of visitors to a site do not register and mention the lack of privacy or trust as their main reason. Well, duh!
In a down economy, one would think that trust would be a paramount concern for marketers. With consumers being extra careful with every dollar, anything a company can do to allay privacy and security concerns is well advised. Yet, the opposite seems to be taking place.
Desperate for new sources of revenue, online businesses are lashing out in every direction to monetize their content. Consumer information that might have been considered sacrosanct in better times is now passed around like candy. One company recently lampooned this trend in a television commercial: A lady in a bar is persuaded by a seeming gentleman to give him her phone number. He then proceeds to sell it to the other men in the watering hole. Amusing, to be sure, but regrettably not far from the truth.
Is it really surprising that consumers are wary of giving out personal information? Consider the average registration page on a Web site. Far too often, subscription boxes for newsletters or advertising from related companies are already checked, that is, an opt-out instead of an opt-in. Better still would be double opt-in. If the first thing a company tries to do is mislead a consumer, how warm will that customer feel toward the company?
To be fair, this cavalier attitude is hardly new. Some months ago, a particularly insidious form of permission creep appeared. The premise was that even though a consumers may have opted in for a particular newsletter or another form of regular communication from a company, they would be forced to accept additional communications from third-parties. Take it or leave it. If consumers didn’t want that extra advertising, they’d have to forego the content as well. As one perpetrator of this dubious scheme wryly noted at the time, “The free lunch is over.”
Apart from being incredibly myopic, not to mention antagonistic, this attitude misses the point. If online marketers are only concerned with turning a quick buck and getting through the quarter with a decent balance sheet, they might as well give up now. To have any hope of success, companies must — underscore “must” — develop long-term relationships with their customers. This can only happen in a milieu of trust.
Let’s not forget security. Though the overwhelming majority of online transactions are perfectly safe, considerable media attention is paid every time a hapless consumer’s credit card number is hacked. Inevitably, consumer psychology plays a pivotal role in the success of online commerce. Marketers should be mindful of that. Rather than relegating privacy and security policies to the nether regions of their sites, companies should go out of their way to allay consumer fears at every turn.
This should not happen out of the goodness of the corporate heart. As the same study points out, only 25 percent of a typical online company’s sales come from repeat customers. In other words, by playing fast and loose with a customer’s privacy, companies pretty much guarantee they will have to constantly find new marks. That’s expensive and ultimately unnecessary.
By respecting customers and giving them something of value, marketers can establish the critical dialogue that will ensure an ongoing relationship. This is hardly a novel idea. The time-honored concept of customer lifetime value presupposes the customer will keep coming back. That’s probably one reason many offline merchants have been around for decades while online companies are going belly up faster than you can say dot-bomb.
Is it really that hard for companies to give consumers a genuine choice and clearly state their privacy policies? Surely not. This may be an opportune time for some introspection. The businesses that work with their customers and bond with them now will make it through the down times and be leaders in online marketing in the future. Trust me on that.