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How to Build Trust Into a Competitive Advantage


In the classic 1947 movie, A Miracle on 34th Street, Kris Kringle is in New York City over Thanksgiving weekend, and through a series of small events, becomes the store Santa Claus at Gimbel’s, one of the top department stores in the city.

Being Kris Kringle, he knows everything about toys. If Gimbel’s doesn’t carry the toy a child asks for while sitting on his lap, Kris tells the parent which store in New York City carries it.

At first, Mr. Gimbel is outraged – his store Santa is sending customers to the competition! But then sales shoot through the roof. Every department in the store – women’s apparel, furniture, etc. – is ordered to start sending customers to other stores to find the item they need.

Soon enough, other department stores in the city adopt the practice, too. Everyone enjoys increased sales and something else that is harder to earn – trust.

Kris Kringle practiced something called trustability, or proactive trustworthiness. In plain English, it’s about going out of your way to do the right thing for your customers without them asking.

I just watched a presentation on the subject given by Don Peppers, author of Extreme Trust: Honesty as a Competitive Advantage, during’s Brands-Only Summit last year.

As Don points out in the presentation, trust is our first filter, and it is becoming more and more important in today’s society. In fact, every business needs to have trustability, or they are doomed.

I know you want to learn how to build trust into a competitive advantage, so start by practicing five things:

  1. Demonstrate humanity: We all have empathy and understand that mistakes happen.
  2. Think long-term: You might choose do something for a customer today that will cost you in the short term, but the goodwill and trust you build will pay off for years to come.
  3. Be competent: You have to be both product-competent and customer-competent, not one or the other.
  4. Share: People want to share and help, and they expect the same of you.
  5. Respect evidence: Data is objective and accurate, so don’t discount it.

And here are some specific, tactical things you can do:

  • Provide brand-neutral content: Speak to the customer in their language and address their needs.
  • Recommend a competitive product when appropriate (see Kris Kringle!).
  • Let customers know when a rate or price will increase or a warranty or subscription will expire (or automatically renew).
  • Proactively send a refund if something goes wrong.

What do you do to build trust?


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