The Mountaintop Insights, Inspiration and Perspective for Enlightened Marketers

After taking a short break from blogging/writing over the past several months I have spent the last week trying to come up to speed on current topics/trends/issues that my audience cares about. Recently i have been hearing a lot about “‘social currency” and that “trust is THE currency” of the day. But why trust? I mean we can’t measure trust, we can barely agree on a definition of what trust is in business. So why do we hang our hat on something so intangible? This has troubled me a fair bit and while I never would begin to express that I have “THE answer”, I will certainly put forward an interesting argument to reconsider what your social currency is and how you can develop a social economy based on it.

To begin we need to understand trust…

What is Trust?

The classic definition from Wikipedia put forward that trust has the following elements to it:

• the willingness of one party (trustor) to rely on the actions of another party (trustee);
• reasonable expectation (confidence) of the trustor that the trustee will behave in a way beneficial to the trustor;
• risk of harm to the trustor if the trustee will not behave accordingly; and
• the absence of trustor’s enforcement or control over actions performed by the trustee.

If we can agree that trust embodies the above elements, after all it does come from a highly reputable source, then we will be able to at the very least establish what trust is as a human construct and that it is based on action and behaviours; and behaviours, of course, drive action. So if trust can be gained through action and underlying behaviours, then we can also assume it can be lost through action and behaviour.

What is Currency?

The next step is to reach a common understanding on what a currency is… again, we turn to Wikipedia, that trusted source of human knowledge where the actions of hundreds and thousands of people have created the biggest repository of human knowledge; refined through countless iterations. Again we see actions building trust. Interesting… but I digress.

Back to currency. It seems, according to Wikipedia, that currency has several key attributes as well that help us shape our common understanding.

• Currency is commonly held to be a medium of exchange.
• Its essential function is that is a “measure of value” which means it needs a constant inherent value of its own and stable purchasing power.
• Lastly, a currency is convertible requiring no restrictions on the amount of currency you can convert or no fixed/limiting value to it.

So shouldn’t a social currency have the same rough definition? It begs the question… What human construct can be a medium of exchange? Is trust even capable of being a currency?

In my mind trust doesn’t have these qualities, in fact trust has all the qualities of a product; it is something purchased via continuous action. We certainly can’t exchange trust. Trust is most likely one of the most difficult human constructs to measure and apply a value; it is ethereal and personal and therefore lacks the ability to have a constant inherent value past a single person. You simply cannot measure it regardless of what the social measurement folks like Tweetlevel, Empire Avenue, and Klout tell you.  Lastly, trust is not convertible; at least not in a way we could apply to being a currency.

So what do we have that makes a good social currency? In my mind it is action.

How Action Forms the Basis for a Social Currency

So if we look at action as a potential currency it to also needs to meet all of the criteria listed above that trust seemed unable to adequately fulfill.

1. Action can be exchanged. Action, by its very nature, promotes exchange; action and reaction. Further, we know that action acquires or loses trust, again another exchange.
2. Action is measurable and can have a constant inherent value. For decades we have been applying value to action. We know down the penny what a customer service phone call is worth not only from an actual dollar value but also from an action-reaction valuation. I mean, this is the basis for Net Promoter scoring – will you refer us to your family or friends? It is a system where every action has an inherent value to the point where enough trust is acquired to promote a new action/reaction – a referral. Further, action is infinitely measurable – its the one thing we can measure in social for example.
3. Action is convertible. Action can be converted at anytime depending on how the person you are performing an action for both values and builds trust. Understanding human obligation enables us to further demystify how action can be converted for higher values or converted faster. Obligation simply means that if i do something nice for you, you will (eventually) do something nice for me. Continued action that builds obligation will drive

By performing actions for our customers, we build trust. Trust is a result of positive action; it is the product we purchase with action-based currency. Over time and depending on how the individual measures the value of your actions they convert it to trust on your behalf – a trust they transfer to your brand.

How Do We Acquire and Lose Trust with Action Currency

So if we assume that action is what we use to purchase trust; its is cause and affect. But now we need to determine where trust-building actions come from in the enterprise. It is my opinion that the divisions tasked with direct service to the customers that are the instruments to deliver action and directly affect the value of that currency.

• Marketing: Marketing sets the stage for the base value of your social currency. The value of your base currency is directly equal to the integrity of the actions that marketing takes. If your marketing bends the truth, over promises or misleads then you devalue your currency. Each action marketing takes whether its an email communication, a mobile app or event has the opportunity to deliver positive action.
• Sales: The relationship the customer develops with sales staff is the primary set of actions that either acquire or lose the trust. The key here is to make it easy to do business with you and simplify the process of becoming a customer. Lastly, do what you say you are going to do when you are going to do it. Harder than it sounds for many.
• Customer Retention and Loyalty: Probably the one department that holds the most traction with customers and the least valued in the social strategy. Why companies commit all of their actions to acquiring rather than keeping customers, I will never know. To continue to reinforce/build trust the actions must give them a reason to continue to be a customer; rewards and simple shows of appreciation are great ways to do that.
• Customer Service and Support: One of the biggest areas of negative action is customer service. Why do we put our lowest paid, least trained staff on the front line and then limit their ability to serve the customer with selfish SLA or customer service policies? Nothing erodes the value of your social currency faster than the inaction or negative action of customer service.
• Billing/Finance: It escapes me why we don’t ever consider the impact of finance department’s actions in relation to the value of your currency. One poor interaction or dispute with billing and your value plummets. Always look to resolve in the best possible manner.

Brands that understand that the result of positive action is trust gradually improve the value of their “brand currency” or actions enabling them to apply arguably less effort for better results. As we apply positive action to a person, group of people or market, we increase the value of our “brand actions” thus enabling us to purchase more trust faster. Where a brand performs actions that are either low quality, contradictory, negative or selfish they devalue their currency.

Brand Currency

Much like the world’s nations have their own currency systems, I believe each brand has their own social currency and while the basis of that currency is action, the value can vary wildly depending on the value and qualities of each action the brand makes to its customers. This makes it easy for us to begin to understand how some brands can purchase trust so easily and others struggle constantly. It is the perceived quality of that brand’s “actions” that create the value of their social currency.

I have learned the following rules hold true for building and retaining value in your brand currency.

1. Be customer-centric: There is no action better than that we do for the needs of others. Give to receive.
2. Simplify everything you do: In age of ridiculous complexity, simplicity in your actions and the actions you ask customers to take builds incredible value. Simple actions have higher value than complex actions.
3. Be friendly: You don’t have to be genuine, but you do have to be friendly. Friendly staff can a long way to maintaining the value of your currency even when they have to do things the customer may not like.
4. Be fast: The first step to good service is acknowledgment and in an age of live social interactions, brands must be expedient in their response to customer inquiries. This further

As a student of human nature, I have also been able to develop a theory on obligation and its role in building a highly valued currency. Understanding human obligation enables us to further demystify how action can be converted for higher values or converted faster. Obligation simply means that if i do something nice for you, you will (eventually) do something nice for me. Continued action that builds obligation will drive the acquisition of trust and positive customer reaction on behalf of your brand. As you acquire more trust you will be able to exert more influence over that customer and guide their actions in a more meaningful way.

Whether your brand currency is a Peso or a Pound is a direct result of your ability to acquire trust through the actions your company takes.

How Social Currency Leads to Influence

I would be remiss if i didn’t tie this back to influence, a topic I hold near and dear to me heart. In my journey to uncover the Nature of Influence and its many forms, I believe that in the context of social currency, the higher the “value” of your brand currency or actions, the more influence you wield over customers. Again, I turn to human nature and the relationship between action, trust and influence.

Actions buy trust and trust buys inlfuence. The more we trust a brand, the more that consumer becomes susceptible to brand influence and the more we are able to guide a customers interactions with our brand. It is an integral part of trust to lower our defenses as part of our commitment. Once we lower our defenses, we become easier to influence. So long as you never betray or abuse that trust, you will continue to be able to apply influence using your currency.

A Poor Value Social Currency Can Lose Customers

The same relationship works to acquire new customers whose trust has been eroded by brands with poorly valued social currency. Telcos are a prime example in Canada. Never has there been an industry where trust has been more exploited than in telco. I will give a living, personal example. I am in my last year of a 3 year contract with a major Canadian telco for my business mobile service, no names but it begins with “R” and ends with “ogers Communictions Ltd.”.

In my second year, I had issues with my Blackberry and contacted Rogers tech/customer support for help. They proceeded to let me know that i was not eligible for any handset replacement, nor would they compensate me for a month of non-service. This continued for over 4 weeks and eventually i was able to get to customer retention whereby they agreed to replace my handset and credit my account $200 if i re-signed for another 3 year term. Not that i am anything special, but my account is worth over $4K per year and while its not a large amount, its not small for an individual either.

By the time they had given that unsavoury offer, their actions and seeming lack of positive action lost my trust. I found an old handset, turned down their offer, and to this day they have not credited a penny to my account or followed up in anyway. Their brand currency is valueless to me. But now the currency of rivals has much more value to me even if my current provider takes decisive action to resolve my dilemma. Its simply too late for them. It is a message I have shared with many friends and colleagues via professional and social networks thus impacting the value of “R’s” currency with those whom I am influential.

The moral of this story is that as brands, it is within our power to develop a social currency that delivers enormous success, eternal mediocrity, or miserable failure. Every action we take with our customers defines that value.

So the real question is… do you want a Peso or a Pound?

In 1610 Galileo, now considered the father of modern science and observational astronomy, began to publicly support the belief that the sun, not the earth, was the center of our universe. His heliocentric beliefs met with bitter opposition from his peers and the church who condemned him as a heretic. It was no coincidence, as it has always been, that those who benefit most from the status quo prove to be the most resistant to any kind of opposing thought, no matter how much sense it makes.

After a year of exploring the nature of influence, I firmly believe I am now, and have always been, inconsequential. That being said I also believe, like Galileo did about the sun and earth, that our view of influence is strongly based on the beliefs of those that benefit from it the most. This current self-centered view of influence puts man/woman as the center of the influence universe – a view I do not share and believe to be the exact opposite of the truth; a truth many would consider heresy.

So what if something else is the center and we all orbit around it? Perhaps its more than one thing where we are torn and pulled into different orbits as we near forms of influence with stronger gravity?

In my mind, a form of influence known as “Situational Influence” is the center of the universe we all orbit. I will be exploring this topic over the next while in a three part series; the first part of which is the Nature of Situational Influence..

The Power of Situational Influence

If we think deeply and track back our actions in life many of us would see a series of situations that propelled our actions and became the major influence in all of our big decisions. Indeed, if we look at the myriad of small decisions we make each and every day, we will see our priorities are affected and shaped by a series of interconnected events and situations that rise and fall as they collide against each other and challenge our values, beliefs and perceptions to drive behavior.

The basics keys on Situational Influence…

1. Situations directly affect action.
2. Situations rise in priority according to urgency.
3. Urgency drives immediacy of action
4. We are oblivious to all of it.

Now, with that in mind, I am going to illustrate how this works using a rain metaphor and will return to our planetary metaphor in Part 2 and 3 of this series. But for now, rain is an excellent way to understand Situational Influence in its simplest form.

The Coming Storm

Have you ever been caught in the rain or a sudden storm? Imagine back to how that affected what you were doing and how you changed your behavior to cope with the rain or escape the storm. Our actions changed according to how intense the rain or storm became. As it rose in intensity, it drove more immediate action in us.

The nature of situational influence works in much the same and is amplified by urgency.

In the above illustration, Situational Influence is represented by four distinct states of rain from Drizzle, Rain, Storm to a Flood. Underneath these is how the urgency of situation makes it rain harder thus creating a more directly influential situation. While the examples underneath give examples of what can be possible motivating situations at each stage of rain.

Obviously, it would also be best to represent rough percentages that each person would experience each form of situational influence. While I am no statistician, I have assigned some arbitrary values to each based on the loose definitions and examples from above.

Further, if we wanted to really explore this metaphor we can add another factor which would be duration of the situation. The interesting attribute to duration is that while a duration can vary wildly anywhere from instant to a whole lifetime such as an illness, it can be applied to any situation and any state of urgency. For example, you can be laid off and be out of work for a day or you can be out of work for years. An illness can be instant like food poisoning or a lifetime like cancer.

So what we have are 3 factors which help put basic boundaries of understanding around situational influence…

• Type of Situation: Drizzle, Rain, Storm, and Flood.
• Level of Urgency: Mild, Medium, High and Life Changing.
• Duration: From Instant to Lifetime; a single second to decades.

With this in mind, let’s now explore how a situation affects a single person such as one of your customers, and for this purpose i will stick to a consumer, although Situational Influence affects businesses equally.

Of Umbrellas, Shelters and Arks

Again I am going to ask you to remember back to being caught in a sudden rain storm without any kind of shelter or way to keep the rain of you. How did that make you feel? For most people, its not a good experience. So, if we continue that imagining so as to now picture that person in the rain as a customer in a situation and let’s assume its a negative situation. Like anyone caught in rain, the customer is looking for something to protect them from the rain such as an umbrella.

For me, an umbrella is a great way to represent an experience a company can design to protect a customer from a rainy situation. The umbrella experience delivers the potential of several things:

1. It is the opportunity to turn a negative situation quickly into a positive situation.
2. It arms the customer with ability to endure, solve or minimize a negative situation.
3. It gives the customer something they can share with another because who hasn’t at one time shared an umbrella?

A great example of a rain situation and an umbrella/no umbrella experience is the following:

No umbrella: A mobile customer is having issues with their mobile device and attempts to get hold of technical or customer support. The longer it takes to get resolution, the more rain falls on them and the more negative they become.

Umbrella: The same mobile customer is having issues with their mobile device and goes to the companies Twitter support channel (the umbrella experience) for fast, effective assistance. In this case, the customer is protected from the rain and is likely to share that “umbrella” with others who are in the rain.

Now an umbrella will do you no good in a serious storm or a flood which brings us to two stronger forms of experience; the Shelter experience and the Ark experience.

In bad times, give them shelter…

Now, we are going to increase the intensity to recall a time when we were caught in a fierce thunder storm with driving rains, lightning strikes and booming thunder. For me, I distinctly remember a fair amount of fear when I was a boy and which grew into respect for the power of storms as an adult.  But as a child, I had no way to deal with it until my mother taught me the counting game and I’m sure most everyone knows this one.  Basically, from the moment you see lightning you count Mississippis until you hear thunder. If the count gets higher between the two, the storm was lessening. If it the count gets lower, the storm was getting worse. Now here’s the thing, as a kid, I would keep counting until the storm lessened because I was given a way to cope with the fear it created in me. It didn’t matter that it lasted 6-7 hours, I would keep counting.

As a customer, there are situations in life where you need shelter from a lengthy or intense storm – the kind that disrupts your life and impacts your emotional well being. The Shelter experience is designed to help through more difficult or prolonged situations. Again, give them somewhere to go and someone or something to rely on.  In this case the shelter could be a no hassle service (shelter) on getting a customer who has been in a car accident back on track instead of giving them a hard time (no shelter). But the important thing to do is give them, at the very minimum, a shelter experience based on your own version of the counting game to get them through the storm. They need to know you are down the hall and the storm, while intense and scary now, will go away if they keep counting.

Or follow Noah’s example and build an Ark…

In the late summer/early fall of 1988 in lived in Edmonton Alberta, Canada – a polite agricultural part of Canada much like the US Mid West. Now, Alberta can get some pretty severe weather and it can come out of nowhere. This one particular day we experienced what would become to known as the worst tornado event in Canadian history. I was eighteen at the time and stuck in traffic on a highway outside Edmonton when the sky turned ominous, the winds picked up and the hail began. Up to this point, it was pretty status quo for Alberta storms, but the wind kept growing in ferocity. I will never forget the feeling I had when I saw the funnel come down about ten miles away and begin to rip through south eastern Edmonton. That Tornado went on to devastate a large part of the city and killed many people. The clean-up, which I volunteered to do with many, many others, hit home with me. These folks literally lost everything.

Now apply that kind of devastating situation metaphorically to one of your customers. When the absolute worst happens, you need to get that customer safely out of the way of the flood. Examples of these types of situations abound from the death of a loved one to losing your home. An Ark experience, while not likely to happen often, is a part of a more complex customer/advocacy support program.  If you can’t get them in the Ark, then build your Ark experience around helping them rebuild or build their lives after a major life-changing event. The Word of Mouth Marketing power that comes from Ark experiences is enough value in and of itself to strongly consider doing it. If you leave them stranded, not only will they never forget that, but someone else might save them.

Before it Rains, Hand out the Umbrellas

So understanding the basics of Situational Influence means we can begin to map out the types of common situations that affect our customers. Even starting at the lowest form, Drizzle situations – those mild, mostly inconvenient situations that eat time out of our already busy schedules, gives us the opportunity to create a simple, highly effective umbrella experiences to deal with many of those for our customers. The best place for it? Customer service by far. Here are the questions you need to answer:

1. What situations affect my customers?
2. How do these situations affect my customers?
3. How do they resolve these situations now?
4. How can we make this easier, faster for them?
5. What is the umbrella experience?
6. What do we need to do in order to fulfill/deliver/enable that umbrella experience?

The key to success before you start? Make sure the customer is involved in answering every single question! Without customer involvement you will fail. If however you follow this formula, you can start handing out umbrellas to your customers before it starts to rain. Chances are they will share that umbrella with others over and over.

Rainmaking

That last question I have in my mind regarding Situational Influence in this post is: Once we hand out the umbrellas, can we find a way to make it rain? By that I mean, is there a way to increase urgency for positive situations? Customer fulfillment is an often overlooked way to not increase share of wallet but also improve customer referrals and Word of Mouth marketing. By encouraging more active participation in your umbrella experience, you naturally drive more mutual benefit.

The best example I can think of is Starbucks Customer Engagement program – My Starbucks Idea. If you haven’t checked it out, it is a shining example of how a company created an umbrella experience, delivered exclusively online, that  increases urgency for participation in the community by rewarding involvement with both recognition and rewards (Ideas in Action and Leader Board). The point is, by being customer-centric,  providing a community devoted to the experience the love, giving the customer a means to use their voice and see action, Starbucks has successfully improved the urgency to become involved actively in the brand.  They are essentially making it rain by creating a positively influential environment and situation for their customers.

To leave you with a thought… I can’t help but picture the scene of “Singing in the Rain” where Gene Kelly has his solo dance/song scene overwhelmed with the joy of having spent a fine evening with a lovely woman. His joy and energy are inspiring and fantastic to behold. It is a powerful reminder that rain can be enjoyed if you have the right attitude.

Let’s make sure we work hard to build that attitude in our customers.