Astute business leaders have long recognized that trust is a vital element of competitive success. But traditionally, trust has been viewed as a “soft” issue – one of those things we know is important, but find difficult to measure. New research by Accenture Strategy quantifies the impact of trust on both revenue and earnings.
So far this year, I’ve published seven posts here that have addressed some aspect of trust. I’ve devoted this must attention to trust because it has a significant impact on virtually all aspects of marketing. Trust lies at the heart of all business relationships, and back in January, I argued that widespread buyer skepticism of vendor-provided information was one of those elephant-in-the-room issues for B2B marketers.
Lack of trust produces a major drag on marketing performance. If buyers don’t trust what you say, they won’t give you credit for understanding their needs, or for providing relevant, personalized, and engaging content and experiences. It’s no coincidence that most companies aspire to be seen as a “trusted advisor” by their customers and prospects.
Most business leaders instinctively understand that earning and maintaining the trust of existing and potential customers is essential for success. But because trust is intangible, its economic and financial impacts are difficult to measure and quantify. A recent analysis by Accenture Strategy has now established a clear and measurable link between trust and both revenue and earnings.
The Accenture Strategy “Competitive Agility Index” is a measure of a company’s competitiveness that is based on three equally-weighted components:
- Growth – Year-over-year enterprise value growth and revenue growth
- Profitability – Multi-year views of return on invested capital, net debt, and EBITDA margin
- Sustainability and Trust – A quantitative view of environmental, social, and governance factors, including the United Nations Global Compact principles, and a proprietary measure of trust based on publicly available data
Illustration courtesy of chuks mbata via Flickr CC.