Building Trust through
Digital Communication
Professor Paul Argenti
Tuck School of Business at Dartmouth
Bob Pearson
Blog Council & WeissComm
“Trust is like the air we breathe.
When it’s present, nobody really
notices. But when it’s absent,
everybody notices.”
—Warren Buffett
Our System Hinges on Trust
Capitalism is based on trust—when broken, credit markets
seize and consumer spending grinds to a halt.
As a result of the global credit crisis, the credibility of the
capitalist system is being seriously challenged:
• Alan Greenspan, dubbed the "greatest banker who ever lived,” admits
to misunderstanding market mechanics
• Iconic CEO Jack Welch admits focusing on share price was dumb
• The Financial Times runs a major new series "The Future of
Capitalism" calling into question the effectiveness and survival of our
modern business system
Source: “Rebuilding Trust in Business,” Bronwyn Fryer, HBR blog, March 17, 2009
Does Business Act Responsibly?
0%
25%
1968
1976
75%
70%
15%
1985
2008
50%
30%
20%
Yankelovich & CNN/USA Today/ Gallup Poll
100%
Tainted Reputation by
Financial Association
• Trust, reputation, and image have become increasingly difficult
for financial corporations to control
• In the wake of billion-dollar government bailouts and year-end
bonuses, the public has been quick to judge all players in
financial services—and their employees—as pariahs
“I’d almost rather say I’m a pornographer—at least that’s a
business that people understand.”
–Retired Wall Street executive who asked to remain anonymous
“Oh, you’re one of THEM…”
–Comment to a recently laid-off JP Morgan Chase employee
“Wall Street’s New Pariah Status,” The New York Times, February 3, 2009
“Can I interest you in a faith-based account?”
–New Yorker, October 2008
Identity, Image &
Reputation Drive Trust
Corporate Identity
Names, Brands, Symbols, Self-presentations
is perceived by…
Customer
Image
Community
Image
Investor
Image
Sum of their
perceptions equals…
Corporate Reputation
Employee
Image
Why does Reputation Matter?
Price
Advantage
Competitive
Advantage
Stability
Companies with better reputations:
• Command premium prices
• Pay lower prices
• Entice top recruits
• Have more stable revenues
• Face fewer risks of crisis
• Experience greater loyalty
internally and externally
• Are given greater latitude by constituents:
Opportunity to operate
• Have higher market valuation and stock
prices
• Have greater loyalty of investors, less stock
price volatility
Reputation environment is changing
The evolution of communications
requires a new approach
to reputation measurement
Web 2.0
Social Media
Buzz
Folksonomy
Podcasting
Wireless
RSS
Blogs
Operations
Media relations
Tagging
Grassroots
outreach
Press
IR
releases
YouTube Search engines
Promotions
Pitching
reporters
Management
and Strategy
Online outreach
Wikipedia
New
Communication
Traditional
Communication
Third party
outreach
Special
events
Brand
management
Government
Relations
Viral
marketing
Advergaming Metaverses
Public affairs
Branding
Facebook
Employee
communications
Content optimization
MySpace
Syndication
Customer Loyalty
Finance
Consumergenerated content
Flickr
Social
networking
Citizen
journalism
Recruitment,
Retention
Defining Social Media
Social Media is the democratization of content
and the understanding of the role people play
in the process of not only reading and
disseminating information, but also in
sharing and creating content.
• Communication in the form of conversation, not monologue.
• Participants in social media are people, not organizations.
• Honesty and transparency are core values.
• It's all about pull, not push.
• Distribution instead of centralization.
Web 1.0 vs. Web 2.0
Web 1.0
Web 2.0
Collective
Intelligence
Published
Content
User
Generated
Content
Published
Content
User
Generated
Content
Web 1.0 vs. Web 2.0
Web 1.0
•
•
•
•
•
•
Web 2.0
Push business models
Commercial software
Customer service
Bestseller products
Traditional media
1on1 customer
relationships
• Centralized product
development
Institutions
•
•
•
•
•
•
Pull business models
Open source software
Customer self-service
The Long Tail
Social media
Customer community
relationships
• Decentralized product
development
Shift of Control
Communities of
Individuals
The Fundamentals of Trust
• Trust is more emotional than logical—it extends beyond
rational thinking
• Trust is highly personal—no universal standard exists
• The notion of trust is based on:
− Predictability: you know what you’re going to get
− Leaps of faith: you’re willing to deal with someone despite
incomplete knowledge of them
− Exposed vulnerabilities: you enable someone to take
advantage of your vulnerabilities but expect they won’t
− Blind belief: you rely on someone to follow through
without the need for constant oversight or questioning
If tarnished, trust is exceptionally hard to restore
How Can Companies
Bridge the Trust Divide?
• Trust is not only about following baseline rules,
procedures, and protocol—that’s only the beginning
• Trust is a direct by-product of a company’s
relationships of interdependency with its diverse and
inter-connected constituencies
• To build trust, a company must not be authoritative
but authentic in all of its dealings with constituencies
• One current way: Through use of social media
Source: The Authentic Enterprise, Arthur Page Society, 2007
Becoming an Authentic Enterprise
by Embracing Social Media
Companies become authentic by:
• Dealing with constituents openly and candidly—forging partnerships
as equals with constituents
• Honestly communicating the unique qualities that set the organization
apart from the competition and will truly add value to customers
• Clearly conveying the values that define the organization—the
underlying principles that underpin every action taken by employees
and the organization as a whole
• Making promises and never failing to keep them
• Admitting mistakes when made and reiterating how they will be
prevented the next time around
• Social media enables companies to communicate authentically
What Do Leaders of Great
Brands Understand About
Building Trust Online?
#1: Customers are co-shaping your
reputation everyday
Are you accidently outsourcing the building of your brand?
Customers Shape First Impressions
Customers are Changing
Faster than Companies
• Breadth: 500k new online customers each day
• Location: >40% of online in Asia
• 1st Impressions: YouTube Is 2nd largest search engine
• Habits: Brazil one of leading consumers of online info
Are you a student or an observer?
Countries’ Habits are Changing
as They Mature Online: Brazil
#2: Leaders will identify
issues before they happen
Customers assume we are listening
to their issues in real time
Patterns are Clues Waiting to Be Found
• Patterns emerge before public awareness
‒ A common problem emerges in a forum in Beijing, a blog in the UK
and a mention on twitter in the U.S.
‒ Your multi-function hot issues team springs in to action to analyze
what is happening and prepare
‒ When the issue becomes public, you are ready with answers
• Customers trust us to be smarter on identifying issues
• You decide that if a hot issue is defined, it must be solved
• Your company continuously integrates online learning’s into
key parts of your company (institutional memory)
#3: You Realize that Your Customer Does
Not Care Where You Want Them To Go
Customers are part of their own liquid network
Become a friend who can be trusted
A Tectonic Shift is Occurring
in Where Conversations Occur
• Language: Customers speak online in their first language
(10 reach 95%)
• Location: Facebook, Twitter, Forums
• Time of Day: Ex/low volume during day, high volume in
evenings
Where do your customers like to
hang-out, learn and share?
10 Languages Reach 95% of People;
Hindi & Russian are Next
Trust Builds When You Visit
Your Customer in their Home
#4: You Know that <1% of a Customer’s
Time is Spent Purchasing a Product
99% of time is spent browsing and socializing
You build trust by being there when you are
needed, not when you need the customer
The Real World of Our Customers Online
Broadband users
spend 1 hour, 40
minutes (48% of their
spare time) online, and
more than half of this is
spent accessing
entertainment and
communication
The Purchase
Experience
<1% of a person’s time
is spent actually
purchasing our
products
Opinions are formed during the 99% of time outside of the purchase path
E-Commerce Will
Become E-Community
• Reality: <1% of time is spent buying online. 99% is spent
browsing & socializing
• Peer Influence: 3 of 4 customers look to their peers for
advice on a purchase
• Integration: Why would we ask a customer to go to
multiple sites? The value is…….?
Convergence is led by convenience
#5: You Focus on How People
Consume Content & Understand
How it is Changing
Customers decide where they will learn
It is not via advertising…
The Media World isn’t Changing…
it Changed
• Media Outlets: 74 of top 100 outlets for Techmeme are
blogs/online sites
• Bloggers: 3 of 4 look to each other for their next story
• Customers: 3 of 4 look to each other for purchase advice
• Conversations: are the driver of SOV, influence and
recommendations
Don’t define it as offline or online. It’s all one media world.
Just know which conversations are defining your brand
The New Media
32
Your Broadcast Station:
Increasingly, the 1st choice for learning
#6: Your Customer is Discussing
Your Brand Everyday
Do you know where they are occurring?
Are you a participant or observer or are you absent?
How Does Your Customer
Discuss Your Brand?
Dynamic Drill Down
1. River of News
2. Topic Trends
3. Conversation Cloud
4. Language
5. Media Type
6. Post Tag
7. Region
8. Sentiment
9. Source Tag
10. User Assignment
WHAT DOES THIS TELL ME?
Top 50 most mentioned words in conversations surrounding
“Pharmaceutical” over the past 30 days.
Do You Know Where
The Real Traffic Is?
• Allstate insurance: 3.99MM
OR
• Insurance quote: 31.99MM
• Allstate insurance company: 943k
• Insurance group: 22.3MM
• Geico.com: 1.83MM
• Home insurance: 75.8MM
• Geico insurance: 1.77MM
• Auto insurance: 64.8MM
• State Farm insurance company: 4.9MM
What is Being Said About Your
Brand in Each Key Language?
#7: There Isn’t a Destination
for a Customer
Visiting your site is not their goal, no matter how pretty it looks
We are expected to just sort of “be there” when needed
Syndication of Content
Matters More than Site Traffic
• Micro-Communities: The social media world grows &
fragments, simultaneously
• Customer-Driven Preference: “I want what I want where I
want it”. Stop “spamming me”.
• Participation is a Choice: If companies don’t listen,
customers vote via lack of traffic and participation.
What is your content syndication plan?
10-20% of Your Customers Will Call You
Each Year Due to a Problem
80-90% will not call you despite a problem
Few will call you just to catch up
Q&As Matter
• Word of mouth matters
• Partnering with customers
matters
#8: Customers Want to Do Three
Things to Help Each Other
You build trust by being part of this process
Ideas, Knowledge, Solutions
1. Share ideas: Let’s improve the next product or service
together
2. Share product knowledge: Here is what I know…hope
it helps you
3. Help peers with problems: I had the same problem,
here is what I did
Dell IdeaStorm:
Over 11,000 Ideas & 325+ implemented
Think Big: Empower Your Customers to
Share Knowledge and Benefit the World
Solved button
added to
Original Post;
clicking it will
take user to
Accepted
Solution
Accepted
Solution post
Turns green
and logo
added
#9: We don’t have to measure
trust internally, we live it
Our employees feel free to help each other and,
as a result, our company
Leverage the world’s greatest operating system – the web
Employees Don’t Change
When They Arrive for Work
• They prefer blogs
• They like to share ideas and comments
• They want real-life video, not canned productions
• They want to help each other, not be polite to senior
management and hold in their thoughts
#10: We Judge a Person on
How They Interact with Us
Guess what...customers do the same thing
when they shop with us online
Shopping is Changing Permanently
• Ratings & Reviews: Your peers define the brand and
experience for you
• Co-Browsing: Your peers help you shop
• Contextual Content: Info you want appears when you
discuss it
Individuals in companies can have the respect of peers.
How many “company peers” do you have?
#11: We Listen to our Customers,
So We Create New Communities
Think outside the box, then get rid of the box
A community-driven Site
Customers Prefer Content
That Helps Their Businesses
Partnering with Customers
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#12: We Know Preparing for
Yesterday is Ineffective
Old models and habits hold back innovation
Watch for “antibodies”
Ask Yourself if You Know
the Answers to These Questions
• Since mobile will be the leading source to go online in the next few
years, our mobile plan will do…
• Since ten languages reach 95% of the online world, we are having
conversations with customers in x today and y in the U.S. alone
• We know Facebook is growing fast, but we’re also participating in x, y
and z properties, since they have high potential
• In China (or France or Czech or Brazil), we are active in the local
sites, such as Toudou, since they are the online leaders in their
country for video (or photos or search or other)
• We know the world’s greatest operating system is the web, so our
employees can now access all competitive information in real time by
xyz tool on abc platform
Yesterday’s Thinking Leads Us to Place
High Value on Depreciating Assets
• The Top Rankings Matter: Mainstream media is decreasing in total
SOV online
• The Brand is King: Personalities drive brands more than brands alone
online
• The World is Important, But We Really Focus Mainly on the U.S.:
53 countries have English as a language and see similar content
• High Brand Awareness is Good, We’ll Build Brand Value in the
Future Locally: Your brand is being shaped by your customers now
• Customers Count on Us: Nope, they count on each other, not you
Observations on the Old School
• They are old school, but don’t realize it
• They think tweaking the media mix will work
• They wear ties, sound smart and have an answer for
everything and often represent yesterday’s thinking
• They are planning to succeed in a world that won’t exist
in a few years
• They like to “content dump” to get rid of their messages
in hopes someone will find it
#13: We Understand Ethical Behavior
is a Key Part of Maintaining Trust
We don’t support Flogs or Splogs
We would never create a fake ad, so why a fake blog post?
#14: We know that leaders will enter and
become relevant in conversations that
occur everyday in every language all
around the world in communities of
importance to our customers
Companies that cling to the past may not realize it,
but they will lose relevance
MESSAGE
EXPERIENCE
CONVERSATION
RELATIONSHIPS
AFFINITY
&
TRUST
WE BECOME
CONVERSATION ARCHITECTS
Key Coordinates
• The Blog Council: www.blogcouncil.org
• My personal blog: www.csmg.us
• Everything else: www.twitter.com/bobpearson1845