A recent study on personal data by the Boston Consulting Group asked how much is trust worth in online retail? The answer: perhaps even more than you would guess.
It goes without saying; developing rapport and trust-based relationships with customers is at the heart of every retail experience. Now, a new report from the World Economic Forum, in partnership with Boston Consulting Group (BCG), attempts to put a dollar value on the importance of trust.
The report says that while online retail could reach US$2 trillion in the G20 nation by 2016, consumers’ trust perception does have a significant influence on that number. If trust levels increase between shoppers and online stores, the sector could grow to as large US$2.5 trillion. On the other hand, that number may only reach US$1.5 trillion if trust levels dropped.
“Given that this $1 trillion range is from just one small part of the broader personal data ecosystem, it provides an indication of the magnitude of the potential economic impact when other sectors (health, financial services, etc.) are considered – potentially in the tens of trillions of dollars,” the report states.
The BCG report comes in the wake of increasing customer concerns regarding personal data privacy. As more information is able to be harvested online, a growing number of businesses (including retailers) are tempted to gain this information in a variety of different ways. Unfortunately, this can seriously impinge on the all-important trust relationships that retail is predicated on.
The World Economic Forum refers to personal data as “an emerging asset class” in the report, acknowledging the value of such data. However, in order to gain the full value of such data, public and private institutions need to rethink how they do business so that consumers get more protection, rights and opportunities to hold organisation accountable when it comes to their data.
Big data means big money in both the online and offline worlds, this report shows that there’s even more potential for that information than we have realised so far. On the other hand, it also reveals just how important the perception of trust is in the retail environment, and this would equally apply to both the on and offline environment.
What do you think are some of the best ways to cultivate trust?