What’s the difference between customer satisfaction and trust?

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I have to admit to being a fan of Elon Musk and Tesla (not so much of The Boring Company or SpaceX). I always root for the underdog and there have been several notable auto industry entrepreneurs who went up against Detroit, including Tucker and DeLorean.  Both, like others before them, while critically esteemed, couldn’t compete in a capital intensive business against entrenched competitors.

But Elon Musk already has surpassed both men in influence and accomplishments, though the financial status of Tesla seems precarious. Musk continues a non-stop stream of innovation and outrageous Twitter tweets. (If only John DeLorean had Twitter! Watch for the upcoming movie about him, Framing John Delorean starring Alec Baldwin.)

But following Tesla is more than just following my pattern of rooting for underdogs; I’ve learned a lot of things about innovation and management from studying Musk and Tesla.  For example, today’s article in Forbes entitled Tesla Motors Tumbles In Key Trust Measure by Jack Nerad. First of all, while familiar with the auto industry’s measurement of customer satisfaction, ranging from Consumer’s Reports to J. D. Power, I had no idea that there was an outfit reporting on customer trust in auto manufacturers. But there is, AMCI, which just released its 2019 Trusted Automotive Brand Study (TABS). If you are interested in Tesla, read the full article, but what really interested me was Jack Nerad’s disquisition on customer satisfaction versus trust. There’s insight that’s truly valuable for founders buried in this article about Tesla.

One factor that hurt customer trust in Tesla has been its pricing. Thousands of people are still waiting for the Holy Grail, the much touted, but non-existent $35,000 Tesla model 3. It’s worth quoting the dictionary definition of trust:

trust | trəst | noun1 firm belief in the reliability, truth, ability, or strength of someone or something: relations have to be built on trust | they have been able to win the trust of the others. acceptance of the truth of a statement without evidence or investigation: I used only primary sources, taking nothing on trust. the state of being responsible for someone or something: a man in a position of trust. literary a person or duty for which one has responsibility: rulership is a trust from God.

Note that reliability and truth are the keywords in the definition. Tesla has violated trust by its unreliable pricing and frankly, false advertising, with respect to the model 3’s pricing. But doesn’t Tesla rate highly in the Consumer Reports customer satisfaction survey? It has, but quality problems associated with the steep ramp up in production of the model 3 has also eroded Tesla’s customer satisfaction ratings. But what is the difference between trust and customer satisfaction and how do they relate? Heres what Ian Beavis, AMCI Global’s chief strategy officer told forbes.com in an exclusive interview:

Beavis sees trust as being of a “higher order” than satisfaction, a metric that includes satisfaction but goes far beyond it. Because customer satisfaction has been scrutinized for decades now, most brands are fairly good at executing on it, but the AMCI strategist now believes satisfaction is a cost of entry. Satisfying people is just not enough. Based on the hypothesis that emotions beyond satisfaction are the real drivers of customer loyalty and brand enthusiasm, AMCI identified trust as a facet of the buyer-seller relationship worthy of study. And the study revealed that developing and maintaining customer trust is a very, very powerful thing.

If I heard this rather vague comment from a mentee my first question would be, “Can you give me a real world example?”  And Ian Bevis not only gives one, but two examples. And he uses one of my favorite means of helping an audience understand a new concept, analogies:

“The analogy I use about satisfaction versus trust is is the absence of illness doesn’t mean a person is fit or healthy,” he said. “Another analogy I’d use is you don’t get a serious relationship because you’re satisfied with dating someone. It takes love and trust to build longterm relationships.”

So it’s clear from these two examples that trust is indeed a higher order metric than customer satisfaction. The term that doesn’t get defined in the article is “brand.”  I define brand as a product or company’s distinctive identity that is a strong competitive asset; the stronger the brand, the higher the level of trust. For example, I’ve been an Apple customer since the days of the Apple II, and Apple has earned my trust through the brand identity of simplicity, elegance, ease of use, and innovation. I’m not always a satisfied customer of all its products, for example the Apple Cube, was an elegant looking flop. But their values and reputation are so strong that they can quickly recover from the occasional misstep in customer satisfaction.

What’s missing from the article, perhaps as an exercise for the reader, is how do you measure trust? Customer satisfaction has been measured for years by surveys, accepted as valid and reliable. I’ll be looking for articles on how to measure trust. In the meantime I would venture two metrics:

  1. Pre-orders of new products – Tesla must have set a world record with its number and dollar value of Model 3 pre-orders. Planning to buy a product before there are any reviews or even customer word of mouth certainly represents trust.
  2. Used product value – the higher the used product value the greater the trust in the key word: reliability.

Do you even measure trust? And if so, how?

Author: Mentorphile

Mentor, coach, and advisor to entrepreneurs, small businesses, and non-profit organizations. General manager with significant experience in both for-profit and non-profit organizations. Focus on media and information. On founding team of four venture-backed companies. Currently Chairman of Popsleuth, Inc., maker of the Endorfyn app for keeping fans updated on new stuff from their favorite artists.

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