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Economic Psychology

How and why markets aren't rational. Navigational tips for charting the Bermuda Triangle of human economic behavior.




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Into the Looking Glass:
Trust, Virtual Trust, and Impostership
 
Once, back in the ancient past (2002), AKMA commented on Brent Glass's question as to "why the companies that vociferously demand that we trust them are themselves the least trustworthy." My response follows:

Because they are the only ones stupid enough (in the world of emotional intelligence) to believe that trust is a commodity that can be bought and sold; that trustworthiness is a pose to strike in the service of competitive advantage rather than a stance in life. In this construction, trust is a product feature that encourages customers to do what you want them to do in spite of their better judgement or economic self-interest. Paradoxically, in urging us to trust them, they reveal an utter absence of understanding of the concept. This, in turn, lets us know they are entirely untrustworthy.

Three years later, amidst all the speeches, the debates, the attempts at definition, and the caterwauling about the cost of establishing trust online, I still believe this to be true. Indeed, it appears that the most vital question of all has received little or no attention. That question is: "Are you trustworthy?"

If trust is the willingness to place oneself in a position where one is to some extent vulnerable to another (whether economically, emotionally, or physically), trustworthiness is the willingness, ability, and commitment to honor that trust, through a combination of good will, competence, and follow-through.

In any successful trusting relationship, be it commercial or personal, the risk taken by the trustor is necessarily matched by the will and ability of the trustee to deliver on the promise(s) they have made. Also inherent in any trusting relationship are an experience-based, mutual assumption of benevolence and a congruence of expectations. When these characteristics are present, risk is minimized and both parties benefit. The relationship in question could be either personal or professional, financial or emotional; the risk could be either large or small--but the equation does not vary.

The nature of the relationship notwithstanding, the 'contract' is that words and deeds will match. This is why, for instance, dramatic and sweeping commercial promises, when accompanied by lengthy, unreadably small caveats written in undecipherable legalese, engender suspicion....as well they should. Ultimately, exploitative aims reveal themselves in action: PR no matter how brilliant, can function only as a temporary camouflage. People can tell, instinctively, when the signs of impostership are there. Thus, David Isenberg recently asked: "Do you distrust "trusted computing" as much as I do?

Building trust is expensive. There is a good reason for this. Trust is precious. When trust is violated, the trustor typically pays a far higher price than does their MMoN (misfeasant, malfeasant, or nonfeasant) counterpart. Thus, if you or your organization are concerned with building others' trust but are not focusing with equal intensity on making sure you are trust-worthy, you are worrying about the wrong thing. This, in turn, suggests they are right to be suspicious.

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Comments:
Sara,

I really like this post about trust. My parents instilled the value, and difficulty of earning and keeping someone's trust. It is an ongoing process that, I agree, cannot be bought, sold or bargained for in any way.

If I understand this correctly, you are saying that the best way for a business to gain trust from its customers is to truly earn their trust by acting trustworthy. This is intuitive, and I do agree that businesses that 'vociferously demand that we truth them are themselves the least trustworthy.'

How do businesses market themselves as trustworthy? Or is it silly for them to use trust as a marketing tactic, because they are trustworthy, and trust is a quality that can only be expressed over time? Additionally, how can a business that is perceived as untrustworthy overcome that view?

Last note: I think this is a concise and straightforward way to describe trust and trustworthiness: "If trust is the willingness to place oneself in a position where one is to some extent vulnerable to another (whether economically, emotionally, or physically), trustworthiness is the willingness, ability, and commitment to honor that trust, through a combination of good will, competence, and follow-through."

Best,

Alex Weiser
 
Thanks, Alex!

I wrote a lengthy response to this about 10 days ago, then pressed "send." Note to self: save your posts before doing this! The SPOD (spinning beachball of death--Mac equivalent of BSOD - blue screen of death) appeared, followed by an error message: "we could not post your comment," by which time the whole post had evaporated into the ether.

Thus commences Response, Take Two. This time, I will cut to the chase.

I wrote this in 2005, but keep coming back to it because it is very important to me. I wrote the definition of trust after reading a huge amount of research on the subject (psychologists strive to measure that which is meaningful without gutting the meaning and then tallying up what's left, viz, Einstein's famous quote: "Not everything that counts can be counted, and not everything that can be counted counts"). The definition is a distillation of the research combined with my own thoughts and experiences.

Yes, I do believe the only way to be trusted is to be trustworthy. Nobody is perfect and accidents happen. However, there is plenty a person or company can do to prevent them, and when they do happen, it is imperative that they be redressed immediately. In the case where a customer has been put out in any way, it's best to overcompensate them for going to the trouble of telling you about it.

I do not believe companies should market themselves using trustworthiness as a positioning statement, for two reasons: 1. They should be trustworthy, period. This is not a special benefit. 2. Mistakes are inevitable, and when they happen, somebody is bound to throw them back in the face of anyone or any company claiming to be completely trustworthy. Better to simply strive to be worthy of peoples' trust (which few do, unfortunately).

When a company is new, or unknown to the customer, it is possible to overcome the obstacle of novelty by other means. Some of these include:
incentives for trying its products such as coupons or free trials, as well as a number of other tactics derived from social psychology/the ethical use of influence and persuasion. That's another topic for another day--it's a lengthy one--but now you've given me a reason to write about it.

Best, Sara
 
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