Customer trust: Definition, value, and 6 powerful ways to earn it

Customer trust is earned, and not through passive means. For brands, building customer trust promises to be a holy grail of long-term revenue and loyalty. But growing consumer skepticism and the abundance of buying options make it feel elusive.

What is customer trust, really? And how do you go about building it?

At its core, customer trust is no different from the trust you put in your personal relationships, your employer, or your go-to news publication. Building customer trust is like any trust, you earn it and you have to work to protect it.

Earning and keeping trust is only getting harder. After collapsing in 2020 with the onset of the pandemic, trust levels between consumers and brands across most industries have only made a modest recovery and remain stagnant, according to Qualtrics XM Institute research.

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What is customer trust: Definition

Customer trust is the belief or confidence a consumer has in a business’s ability to fulfill its promises and uphold its commitments. In simpler terms, customer trust means that consumers believe a company will act in their best interest – or not.

Building customer trust is walking the walk, talking the talk, and respecting that people are paying attention.

Two tenets of customer trust are crucial to understanding its role in relationships, business or otherwise:

1. Customer trust, like any trust, is earned. It’s not given, and it can’t be faked. It’s earned over time, through every interaction a customer has with your business, from small (e.g. Do I immediately regret giving you my email address?), to large (e.g. How did your company handle a critical data breach?). Every point of contact is a chance for building trust upon a strong foundation in the relationship, or chipping away at it.
2. Customer trust can be broken. And it’s a lot harder to rebuild broken trust than it is to build it from scratch. Now, this doesn’t mean that you’ll never make mistakes. Some mistakes can be forgiven once trust is established, depending on what a company does in the wake of the mistake.

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Why customer trust matters in business

A business needs customer trust to succeed, plain and simple. Customer trust drives loyalty, which is vital to sales, repeat purchasing, and a brand’s reputation.

Customer loyalty

Loyal customers are more likely to stick with a brand over time, which fosters the rich relationships that fuel long-term success. They’re also more likely to recommend a brand to others either by word of mouth or online reviews, which drives growth.

Customer retention and repeat purchases

Having and keeping customers’ trust has only become more important as commerce becomes increasingly digital. Consider all the options consumers have today for buying products and educating themselves before making a purchase. When consumers feel confident that a brand will deliver on its promises, they are more likely to return for future purchases. High retention rates often lead to lower acquisition costs, making it more economical for businesses to maintain their customer base.

Brand reputation

And with the proliferation of social media, it’s so easy to express displeasure if a customer feels a brand has failed to live up to its promises, thereby breaking trust.

Poor customer reviews quickly damage a company’s reputation, which is intrinsically linked to business value. A strong reputation is closely tied to customer trust. In a survey of global executives, 63% attributed their company’s market value to their reputation.

Positive experiences and satisfied customers lead to favorable reviews and word-of-mouth referrals, while negative experiences can quickly tarnish a brand’s image. In 2023, groceries earned the highest trust consumer scores among 23 industries while TV and internet service providers had the lowest, according to the Qualtrics study.

According to a Gartner survey of B2B and B2C customers, 81% won’t do business with a brand they don’t trust.

A Deloitte study found that companies overestimate the level of trust customers have in their brands. While 79% of B2C leaders believe customers trust their brand, only 52% of consumers reported trusting the brands they purchased from.

The growing use of generative AI isn’t exactly helping on the trust front. In the past five years, trust in AI among Americans declined from 50% to 35%, according to an annual study by Edelman.

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The stakes are high on both sides

Between technological advances like machine learning and AI, and the proliferation of customer data, consumers today are putting more on the line than money: They’re sharing their personal data. What’s at stake – quite literally – are their identities.

In our increasingly data-driven world, that could have serious and far-reaching implications.

Customers are willing to share their data in exchange for better, more personalized customer experiences, and those experiences could translate to sales success. But they will stop doing business with you entirely if you misuse or share that data without their consent.

In short: to compete, you need to deliver outstanding experiences. To do that, you need valuable customer data. And to get that, customers need to trust you.

How to build customer trust: six powerful ways to earn it

Of course, businesses can proactively work on building (or rebuilding) customer trust and being trustworthy.

Here are six powerful ways for brands on how to build customer trust:

1. Customer service is your front line for building trust. There was a time when customer service and customer experience were separate. That’s no longer the case – service is now an integral part of the CX, and everyone in your org is responsible for it. This is where collaboration across the company becomes critical, and CRM customer service software can assist in making collaboration simplified in real-time.
2. Transparency is key to building trust– be upfront about anything that affects your customers. Consumers today are extremely well-versed in what solutions exist to protect them. Let them know what you’re doing, what protections you’ve put in place to prevent their data from being compromised.
3. Prioritize privacy and respect boundaries. Give customers control over how their data is collected, used, and shared. Make it easy for them to opt-in and opt-out at will (ideally, from a single spot). And then honor those preferences.
4. Handle conflicts with honesty and care. Building customer trust requires that when it’s broken we fess up and promise to do better.  Mistakes happen. When they do, own them and address them head-on. Don’t make light of a situation where your customers’ data may have been at risk; don’t ignore it in hopes that it will blow over. Equip your service staff to handle any questions clearly and directly, so your customers feel heard.
5. Walk the talk of customer trust. Trust is lost when your words and actions don’t match. The simplest solution? Authenticity and follow-through. If you say privacy is important to you, show it at every stage of the customer journey.
6. Nurture relationships by showing appreciation. Trust is a two-way street. You can’t expect people to hand over the most important assets they have and get nothing in exchange. It’s on you to show how they benefit from sharing their data. Invest in stellar customer service and personalized campaigns. Acknowledge loyalty and show your appreciation – whether with big gestures or just by showing up day in and day out. As you are building customer trust, don’t let your customers feel taken for granted.

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The future of business depends on trusted relationships

As business processes become increasingly automated, companies are even more reliant on customer trust and emotional intelligence.

Establishing and maintaining customer trust is a long game. You can make a quick buck by taking advantage of customer trust, but you won’t earn repeat business (and the fallout could destroy your reputation).

Chances are, if you’re reading an article like this, you’re more interested in the long-term benefits than a short-term gain.

To succeed long term, brands need to operate with empathy for their customers. That means not only getting to know them, but respecting them and nurturing the relationship. Because business is personal.