Liar, Liar: Truth and Customer Loyalty


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Advertising and marketing are part-and-parcel with the financial world. Many people simply decry any form of business or entrepreneurship as exploitative and manipulative. On the one hand, this camp’s perspective contains a kernel of truth: any form of persuasion for one’s own benefit (business profit) presents an ethical dilemma. On the other hand, enterprise drives human innovation and has a vital role in virtually all human societies.

The ICC International Code of Advertising Practice responds to this dilemma with the regulation that “all advertising should be legal, decent, honest and truthful.” But how does one measure honesty or truth? These seem like nebulous concepts.

Best business practices initiate the customer relationship with honesty, decency, and truthful information about your company’s goods and services. Building brand value through honest tactics over the long run always outweighs short-term financial results. For this reason, our primary goal is to develop a culture among senior leadership teams that regard Customer Experience and financial performance as two-sides of the same coin. Our reasoning is simple: without long-term customer loyalty, short-term and long-term financial results cease to exist. End of story.

A powerful example of the customer loyalty fallout from deceptive advertising practices is Publishers Clearing House. We’ve all seen the television commercials with an overwhelmed winner receiving a huge check for millions of dollars from the Prize Patrol – along with balloons, television cameras, flowers and more. The other side of this particular coin comes in the mailbox. Perhaps you’ve opened what you thought was an official government notice or letter from your bank that turns out to be the work of ingeniously creative writers and designers that are there to tell you – or rather, sell you – something you weren’t interested in. A similar phenomenon is “green-washing” where advertisers play on well-intentioned consumers who want to protect the environment by spinning their products to appear eco-friendly.

The most effective advertisements – both legitimate and questionable – appeal to human emotion, primal desires and perception.

So what criterion do we use at Beyond Philosophy to distinguish “legitimate” from “questionable” advertising? As discussed above, “truth in advertising” is a nebulous, if not paradoxical, concept. Thought leadership is the watermark.

When I think of the conversations between the key leadership members at companies like Publishers Clearing House (who use questionable ethics to sell products and magazines), I do not expect to see a team with a clear set of principles to make decisions, or employees who understand how these principles translate into the fabric of business operation. Companies like this build a false façade of a good customer experience, only to disappoint the vast majority of customers.

The upshot of this sobering reality is that even if you are not 100% satisfied with your company’s ability to build relationships with its customers – at least you care.

Republished with author's permission from original post.

Colin Shaw
Colin is an original pioneer of Customer Experience. LinkedIn has recognized Colin as one of the ‘World's Top 150 Business Influencers’ Colin is an official LinkedIn "Top Voice", with over 280,000 followers & 80,000 subscribed to his newsletter 'Why Customers Buy'. Colin's consulting company Beyond Philosophy, was recognized by the Financial Times as ‘one of the leading consultancies’. Colin is the co-host of the highly successful Intuitive Customer podcast, which is rated in the top 2% of podcasts.


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