Trust Pyramid – A Customer Model

In last week’s article (and the GrandView webinar) I talked about using models of customer behavior as a method of understanding and investing in your markets. One example I used is what I call a trust pyramid – representing how people have different levels of trust in the assertions of others. This article explores the idea of the trust pyramid in more detail.

Customer Model Development

There are two challenges to developing customer models. The first is coming up with an idea that is sufficiently representative of behavior or biases. The second challenge is to keep the model simple – at the risk of being simplistic.

Another difficulty with modeling in general is to admit (and never forget) that a model is only a representation. A customer model is no more equivalent to your customers than a map is equivalent to the landscape being mapped. It tells you something about your customers (probably), that allows you to form a hypothesis about their behavior. You can then apply that hypothesis when prioritizing requirements and designing solutions.

I love that Rich Mironov’s book is titled The Art of Product Management, because I think of product management as the artistic application of scientific tools, and the scientific analysis of artistic insights. Product management is both an art and a science.

Trust Pyramid

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The above visual is a simple representation of a trust pyramid, showing different levels of trust based on the nature of the relationship with the trustee. Pyramids are built from the bottom up, so let’s review ideas of trust from the bottom up too.

The purpose of the trust model is to understand how much trust a potential customer puts in a positive review or recommendation of a product.

• Trust of the Manufacturer. People will put the least amount of trust in the manufacturer of the product. Of course the manufacturer will tell you his product is the best. Maybe the manufacturer is wrong – believing the product is “the best” even when it isn’t. Regardless, the manufacturer is not going to tell you to buy someone else’s product (usually), so a recommendation from the manufacturer is almost a no-op – it doesn’t hold any sway.
• Trust of the Retailer. People trust retailers more than manufacturers – because the retailer picked the manufacturer’s product as the one to sell, presumably because it is the best option. But the retailer also stands to profit from the sale, so of course the retailer will tell you that the product is great.
• Trust of a 3rd Party Reviewer. Think of Consumer Reports. They have no financial motivation to promote a particular product. They also have a long term financial motivation to provide “good advice,” so you are more likely to trust their opinions. The key element here is that the potential customer believes the reviewer to be free of bias. An unbiased review is more credible, and therefore more trusted than a biased review from the retailer or manufacturer. Consumers who write reviews about products are also 3rd Party Reviewers. Barring astroturfing campaigns, these sources of recommendations are also good examples.
• Trust of Someone Like Me. Thanks Thomas for helping refine my earlier model with this addition! The problem with a 3rd party reviewer’s opinion is that they are expressing an opinion from the reviewer’s point of view – not mine. A secretary may rave about the comfort provided by a pair of shoes, but she does not stand on her feet all day, so her review is less valuable to me, as a TSA agent, than the review from someone else who stands on her feet all day, like I do. The reviewer is just as trustworthy as any other 3rd party reviewer – but the message is discounted as being somewhat-less-relevant to me.
• Trust of Someone I Know. Even 3rd party reviewers can be disingenuous. Someone I know and trust already will provide an opinion that I trust more than any other. Especially when that person knows what is relevant to me – that I stand all day. If I know the person is not credible or trustworthy, I can discount that data explicitly.

Building the Trust Pyramid Model

Yes, it’s a pretty model. Seeing and understanding the model may inspire you to create models that help you understand your customers. Seeing how this one was created may help you approach the creation of your own models.

In 2009, I was developing some models for visualizing how Word-of-Mouth marketing works. That led to development of a conversation ecosystem model of engagement between companies and their customers – a conversation economy. The final visualization of that model is conversation circles.

The idea is pretty simple. When you create fans of your company, they promote you, quite effectively. Seth Godin has been shouting this for years – but a lot of companies still have cotton in their ears. I was working to help people who were new to the idea of engaging their customers to see the value to their business. Part of this work put the question front and center –why does this work?

The question stuck around with me for a while. As part of trying to understand the underlying dynamics of social networks, and how the reputation-building game mechanic works in reputation systems, I came across a fantastic presentation, The Real Life Social Network by Paul Adams. The next time you have a few hours to spend getting much smarter about social networks, read his presentation.

The key ideas that helped me with understanding trust relative to the types of relationships you have can be found on pages 27-30; 103 & 111-113; 126-137; 147-151; 159 & 160; and pages 168-172.

Meanwhile, I saw a great presentation by Chip Conley, where he adapted Maslow’s Hierarchy into an “Employee Pyramid” that he used effectively to help manage his company.

The pyramid visual, combined with Maslow’s “each step is greater than the next” lead to my attempt to organize the different types of trust into a pyramid. I smoke-tested the model with user experience, user research, and community management people who I trust – leading to improvement of the model.

I’ve been able to validate some aspects of the model by reviewing AB test results of the effectiveness of incorporating elements of marketing-copy, ratings, and reviews into eCommerce sites. This is anecdotal data, but it is consistent with what the model would predict – “more trust” leads to “more sales.”

Do You Have a Favorite Model?

Do you have a similar model you’ve developed and would be willing to share? Any other models (from the webinar) that you would like to see explained in more detail?