To build loyalty, companies must earn the trust of their customers. Consistency builds trust, deepens relationships, exposes customer challenges, and sparks innovation. Inconsistency results in confusion and distrust. One way to be consistent is by communicating openly, honestly and with complete transparency.
Far too often, companies are only transparent when owning up to a negative action or righting a wrong so customers don’t run for the door. Time and again, this approach has proven to be ineffective. Customer retention is achieved only if a company has a history of putting the customer first, through both the good and the bad.
When a business embraces transparency, it can earn a level of trust that would have been otherwise impossible. One of the most compelling examples of how transparency can dramatically earn trust, raise sales, improve quality, and increase customer retention comes from Domino’s Pizza. In 2008, Domino’s conducted an online survey to gauge customer satisfaction. The results were disheartening, with some customers saying the pizza “tasted like cardboard.” Instead of keeping the survey results a secret, Domino’s shared the feedback on social media, publicly asking customers to help improve the quality of their product from the sauce to the crust to the toppings.
Over the next 18 months, Domino’s received thousands of suggestions and invited regular customers to taste-test pizzas while continuing to make changes and focusing on quality. When the product relaunched in 2009, Domino’s debuted a series of commercials featuring the journey and announcing the new pizza recipe. Not only did Domino’s achieve a better product and a competitive advantage over category leaders Pizza Hut and Papa John’s, but the company also built a large, engaged fan base. Today, Domino’s has more than 14 million fans on Facebook and over one million followers on Twitter. The company’s stock has also risen from its low point of $7.73 per share in 2009 to $151.75 per share in September 2016.
As you can see from this example, transparency starts with great service and listening to the voice of the customer. Both lead to deeper customer relationships. The combination of transparency and trust humanizes brands and makes customers feel like they have a personal connection with your company.
Here are four ways to create transparent customer relationships:
1. Be Upfront About Mistakes
Address errors or customer complaints directly and in a timely manner. Explain the steps being taken to handle the current issue or error. This will allow your organization to develop a reputation for honesty while demonstrating to customers that you won’t make the same mistake twice.
2. Encourage Honesty
Once trust is established, customers will be more open to providing feedback. Encourage them to post frequently in your online community and share their experiences with fellow customers. What others say about a company is seen as more valuable and credible than what a company says about itself. These interactions will allow companies to better understand where they exceed customer expectations, as well as identify areas for improvement.
3. Engage Your Customers
According to Forbes, 62% of millennials say that if a brand engages with them, they are more likely to become loyal customers. An online community gives customers the opportunity to ask questions and learn how to successfully use your product or service. Surveys can also be a useful tool for engaging customers and assessing satisfaction. Customer insights help businesses identify areas of competition, evaluate product or service strengths and weaknesses, and determine overall levels of customer trust.
4. Put the Customer First
Think about how the actions you are taking will affect your customers and encourage them to provide feedback about what’s going well, and not so well, with your products and services. Competitive differentiation is short-lived. However, if you can differentiate your brand on the basis of providing a consistently excellent customer experience, you will earn a lot of loyal customers and “customers for life”, as so few brands provide even an acceptable customer experience.
Transparency is more than a buzzword – it is a critical component to a company’s overall success. Not only is transparency valuable to the customer, but it also benefits the company. By embracing transparency and establishing trust, organizations can exceed customer expectations, improve customer retention, attain brand loyalty, and increase profits.