20 January 2017
By Sim Li Hong, Assistant Manager, PwC Malaysia
“Let strangers stay in your home and get paid!”
“Pick up strangers on your way to work and earn extra cash”
Sounds familiar? These are the value propositions of well-known businesses we are all familiar with today - - Airbnb, Uber and Grab. Tell that to someone ten years ago and they’ll probably say, “Are you crazy? I wouldn’t trust strangers in my car, let alone my house”
Now this is what you call “Stranger-Danger bias”, a term coined by Joe Gebbia, the co-founder of Airbnb. The more a person is like us, the less of a stranger they seem and equally the more they are different from us, the more we are on 'Danger Alert'.
How did these companies overcome this bias to gain their customers’ trust? Through years of experience in the industry? Yes, but more importantly they designed for trust.
Here are some examples of how trust is designed. They are more relevant to technology platforms or marketplace businesses but some may be applicable to businesses looking to digitalise or provide digital services.
Where possible, having a rating system for both customers and service providers can keep both parties accountable. For example, Uber has a rating system which allows both drivers and passengers to rate each other. A good rating for the driver indicates a pleasant driving experience, whereas a good rating for the customer indicates a polite and courteous passenger. Bad ratings for both parties usually act as a red flag, with both parties cancelling the job whenever possible to avoid unpleasant experiences. This carrot-and-stick approach acts as a regulatory system which both drivers and passengers can rely on as an indicator of who to trust.
Another way to minimise Stranger-Danger bias is obviously, to make that person less of a stranger. We can do this by sharing more information of the said stranger. However, there can also be such a thing as too much information. Airbnb knows the importance of the right amount of information disclosed. When a guest first messages a host, saying something short like “Yo” will most likely not get any response. Sharing too much personal information such as “I have issues with my parents, so I need a place to stay” will also reduce a guest’s acceptance rate. So, Airbnb designed their chat box specifically to encourage the appropriate amount of words and used question prompts to encourage sharing of information.
A 3-star rating for a restaurant on TripAdvisor doesn’t always mean that the food is horrible. The food may be great but their customer service was so bad it brought the ratings down. That’s why it’s important to create a contextual reputation system, in addition to numerical ratings. TripAdvisor designs for that by encouraging visitors to post reviews in addition to providing a rating. These qualitative reviews are also rated by other readers if they were helpful in their decision-making process on whether to visit the restaurant or not. A week later, TripAdvisor sends out an email stating the number of times people have read the visitor’s reviews, as a feedback loop to encourage more reviews in the future.
I once took a Grab car whereby the driver told me that I had to pay my fare in cash, even though I remembered choosing the credit card option. Assuming that there was something wrong with my credit card, I obliged. Once I got off, I received an SMS notification stating that my credit card had been charged. Of course, my first instinct was to get angry. I called the Grab hotline and it didn’t take long to hear a human voice on the receiving end. They quickly contacted the driver who felt so bad about his mistake that he drove over to my house to return the money.
If there were no such communication channels available, I would have lost my trust in Grab drivers and stopped using their services. Investing in these communication infrastructures help organisations build trust with their customers, and in the long-run, retain them.
In conclusion, trust is not accidental. It has to be designed for, with the help of technology and a keen understanding of our customers. As more companies digitalise and more tech start-ups emerge, trust will be the currency that says “you can rely on my services.”
General enquiries, PwC Malaysia
Tel: +60 (3) 2173 1188