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How Does Wealth Inequality Affect Trust?

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An old Frank Zappa lyric went, “What’s the ugliest part of your body? I think it’s your mind.”

Similarly, we might ask, “What’s the lowest-trust place in (corporate) America? I think it’s Wall Street.”

Which brings us to the latest issue of Harvard Business School Working Knowledge.

I find HBSWK a pleasure to read—they identify the coolest topics for study. The treatment of those topics—well, that can be quirky.

One fascinating current item is “The Dynamic Interplay of Inequality and Trust: An Experimental Study,” by Ben Greiner, Axel Ockenfels, and Peter Werner.

Here’s the (partial) synopsis:

We study the interplay of inequality and trust in a dynamic game, where trust increases efficiency and thus allows higher growth of the experimental economy in the future. We find that trust is initially high in a treatment starting with equal endowments, but decreases over time. In a treatment with unequal endowments, trust is initially lower yet remains relatively stable.

Cool! An egalitarian society shows a greater decay of trust than one with initially disparate endowments? The implications for political theory, economic policy and social dynamics are juicy, to say the least.

The “dynamic game” the authors use to add some empirical juice to theoretical discussions involves a trustor and a trustee. In a series of interactions, the trustor offers a sum of money to the trustee, which sum is then multiplied by the game; the trustee then returns a certain amount to the trustor.

As the authors say, “The amount sent can be interpreted as a measure of trust, while the amount returned measures the degree of trustworthiness.”

Then ensues 20 pages of analytical bludgeoning. Did you know about the Wilcoxon Matched Pairs Signed Ranks (WMPSR) test? Me neither. Did you know the lowest Gini factor ever measured was in Bulgaria in 1968?

I am numbed and humbled; you could say I’m numbled.

And sure enough, the graphs show a decrease in trust if all players start equally, vs. a low-trust start with sustained low trust if players begin with inequality.

But wait a minute! What happened to Frank Zappa?

The appendix lists the instructions given to the players in this game. Here they are:

Welcome! You can earn money in this experiment. How much money you earn depends on your decisions and the decisions of the other participants…it is guaranteed that you do not ineract with the same participant in two subsequent rounds…The identity of the participant you are interacting with is secret, and no other participant will be informed about your identity.

OK, so I want to measure the role of trust and inequality in an economy. Where should I go?

Los Angeles? Omaha? Detroit?

Nah. Let’s go somewhere people aren’t distracted by entertainment, or meat-packing, or cars.

Let’s go where people interact solely around money. Anonymously. And never with the same person twice. (Blindfolds and knives might make it even more interesting).

And let’s call that a trust experiment.

If this game had a geographical correlate, it would have to be the Land of Gekko, where Fear and Greed are baseline hiring criteria—Wall Street.

Not exactly where I would have suggested one go searching for insights about trust.

What’s the ugliest part of that trust? I think it’s the game.

 

Trust Enablement

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Readers of Trust Matters know that I tend to focus on a certain side of trust—the human, complex, messy, emotional, non-linear side of things.

In part this is a personal reaction to my own MBA and corporate background, which emphasized the other side—the linear, rational, cognitive, quantitative side of things.

And in part it’s a reaction to the dominant model in business—which resembles more the latter than the former.

But it takes both sides to get a full view of trust. So I want to take this post to acknowledge someone who does a fine job working the other side of the street.

It is Alex Todd, President of Trust Enabling Strategies.

Alex talks about Trust Enablement®, and has developed what he calls has developed what he calls the Trust Enablement Program™.

He defines trust as “acceptable uncertainty,” and suggests that:

In essence, where Risk Management is all about protecting what you have, Trust Enablement™ is all about getting what you want by, in effect, proactively managing the risks of the relying party (or customer).

I don’t know anyone else who’s gone further in an attempt to systematically and quantitatively describe attributes of trust and applications of trust to management.

Todd’s site is worth visiting if you want to delve into measurement and management issues, or if you simply want to stretch your mind about the issues of trust in business.

He also has the best collection of trust-related quotes I’ve seen.

I don’t always see things the way Todd does, but he is clear, clean, broad and thorough in his thinking. He is usually persuasive, but always insightful.

Anyone interested in trust should not miss his work.

Case Study #17: Trust-based Selling in the Real World

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I bought some designer eyeglasses 18 months ago at Pildes Optical in Short Hills, New Jersey. I was well-served, and happy with the glasses.

A few weeks ago a tiny screw came loose. I took it in. The screw had to be factory-ordered—it was made of gold (I said they were designer).

They called me when the part came in, and I went to the store. While the manager was replacing the screw, I asked the Associate about getting a backup pair for travel overseas. I didn’t want to spend as much.

“You don’t have to,” she explained. “Here are some perfectly good-looking frames that are about half the price; if they’re just a backup, you may not care as much about the aesthetics."

“Also,” she continued, “you may not want all the features you have in the lenses themselves. You can get a perfectly good backup pair by changing a mix of lens and frame features."

"But”, she said, “how is your prescription? Does it need changing?”

“Well,” I replied, “my arms are getting a little short again when it comes to reading. It’s been a while since I got an exam.”

“You really shouldn’t think about getting a replacement set,” she said firmly, “until you’ve had your eyes examined again.”

“Actually,” I mused, “if I get a new set, then this one can be my backup, and it wouldn’t cost me anything.”

“There you go,” she smiled. “That would save you the most.”

The manager came out with my newly fixed glasses, and I took out my wallet. “No, no,” he waved his hand at me, “no charge.”
As I walked out, I realized what these people had done.

On the face of it, they turned down two transactions—a repair, and a sale (of backup glasses). But that’s just the surface.

At one level higher, they guaranteed a much bigger sale—a new set of eyewear for me—worth more than the two foregone transactions. Because they focused on the relationship, not the transaction.

At yet one level higher, they virtually guaranteed that that later sale would be to Pildes of Short Hills—not to anyone else. Because they focused on my needs, not theirs.

At a higher level still, they cemented my loyalty. Not just my repeat business; no, they got me to do something even more important. They got me to feel energized enough to, say, write about it for public consumption in my blog.

I think if I had asked them all this, they would have readily agreed to my analysis, but would probably tell me something like, “that makes sense all right, though we didn’t think it through that way. That’s just the way we believe in doing business.”

This is the paradox of Trust-based Selling®—-if you live by the principles of customer focus, collaboration, transparency and relationships-before-transactions, you will make more money than if you lived by the principle of trying to make money. It works in the real world.

And if you want to buy eyewear, I can recommend a good place.

 

 

Test How American You Really Are!

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As promised in my last posting, here’s a simple self-assessment tool to rate yourself on your general knowledge of the world outside the United States. The fewer you get right, the more American you are, baby!

All have links so you can score yourself immediately (and get educated too—like you care, baby!).

1. Is Sweden East or West of Norway? Answer

2. Can you name the head of State for either Italy or China? Answer

3. Traveling west from Madrid, what country do you first encounter? Answer

4. Which is the most populous world religion—Christianity, Islam, Judaism, Buddhism, Hinduism? Answer

5. Where does the US’s biggest city (by population) rank globally? Answer

6. Have you ever heard of Shenzhen? Answer

7. In what country does Juventus compete? (bonus—in what sport?) Answer

8. Is Bangalore in the south or north of India? Answer

9. What language do they speak in Brazil? Answer

10. On what side of Australia (N, E, S, W) is Sydney? Answer

11. Is Ireland part of the United Kingdom? Answer

 

12. What currency is used in Belgium? Answer

13. Is Japan north or south of Vietnam? Answer

14. In which century was the country of Italy formed as a political entity? Answer

15. In which country is the United Nations headquartered? Answer

 

16. Which languages are spoken in Switzerland? Answer

17. Where is Catalunia? Answer

18. Where is Bosnia in relation to Poland? Answer

19. In what sport do the All-Blacks compete? Answer

20. What country lies between Iraq and Afghanistan? Answer part one and answer part two

21. Hugo Chavez—union leader, president, or owner of World Cup soccer champions? Answer

22. How many time zones are in Russia? Answer

23. Singapore is a former colony of what country? Answer

24. If you’re in The Hague, what country are you in? Answer

25. What language is spoken in Austria? Answer

 

OK, score time.

If you got:

20 or more: You are almost certainly a foreigner—absolutely not an American. You probably don’t know the difference between a Hoosier and a hot dog. You couldn’t tell motherhood from apple pie. You’re quite possibly a communist. We don’t like your kind around here. If you don’t like it here, go back to China and speak Japanese like the rest of them. Nuke gay whales for Jesus!

14 to 19: You may technically be an American, but clearly a lib-dem; 3 to 1 says you’re from New York, possibly San Francisco. You probably went to a private school, and you’re probably in favor of letting immigrants stomp all over our right to bear arms.

6 – 13: Wow, where’d you learn all that stuff? I mean, that’s a lot of work. Who’s got that kind of time? Don’t you think you should be spending your time more productively? It’s all well and good to travel internationally—hey I think Cancun rocks, and I even drove into Tijuana once—but you could be going to an MLB game instead, and supporting the US economy by buying American, like that Sharp TV I bought last month.

0 – 5: Congratulations, awright, you’re an American! Travel? Love it. Can you believe their accent in Buffalo? Great steaks in Dallas fer sure. I always liked the AFC teams best. We’re going overseas next summer, maybe Toronto. Or even New Mexico—do they take dollars there? Either that or a cruise to the Bahamas. Go Yew Ess Aye, Number One!

Americans, Travel and Rushing to Judgment

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I travel internationally; less than some, more than many. These last three weeks I’ve been in three countries (the third visit for one, 10th and 20-something-th for the others).

Travel is good for everyone, I think, but especially for Americans. All right, OK—for me.

(On Monday I’ll have a tongue-in-cheek self-diagnostic test: find out just how American you really are!).

I know a few who love foreign travel. They assume that people are fundamentally the same, and delight in finding the superficial differences, the spices that make the human stew an infinitely varied source of nourishment.

I admire the hell out of them. Because unlike them, my first reptilian-brain instinct is to go to fear-based judgment. An all-too American response, I think. All right, OK—maybe it’s just me.

Here’s what I’m re-discovering on this trip:

• Judgment feeds on fear.
• Fear feasts on ignorance.
• Ignorance fades when one can hear others—in their terms.
• Our ability to influence depends on our willingness to be influenced.
• Our similarities far outweigh our differences.
• Our behavior in groups mirrors our behavior as individuals.

My personal road to growth has been exposure to others. For me as an American, the benefit of international travel is enormous. Yet only something like 20% of us have a passport. Absurdly few of us speak another language—usually poorly at that.

But what’s the link between individuals and groups? Does the road to corporate trustworthiness go through the individual?

Some see trust issues mainly as group issues. I’m more inclined to see groups as aggregations of individuals. Let’s assume and explore—at the risk of touching on politics—the latter.

Marriage-researcher John Gottman says marriages work best when we are vulnerable to and influenceable by our mates. They’re worst when we judge, shut down, and insist on changing the other.

Might nations be the same? Mark Twain says, "Travel is fatal to prejudice, bigotry and narrow-mindedness."

If Gottman’s observation extends to group behavior, then exposure to the world influences us. And, thereby, gives us influence.

Consider foreign student exchange programs, and how deeply they promote understanding. We could afford to spend $10,000 per head to send 500,000 Americans abroad to be influenced, and the same amount to bring 500,000 influenceable foreigners here—all for the cost of about two months’ spending on the Iraq war. With, arguably, better results. In any case, we could use a bit more of that perspective.

One of our presidential candidates said, “the security of the American people is inextricably linked to the security of all people.” It is no accident that this candidate “has a grandmother living in a hut on the shores of Lake Victoria and a sister who’s half-Indonesian, married to a Chinese-Canadian.” (Hint: it’s not Giuliani). We could use a bit of that kind of perspective too.

Peter Jennings—famously traveled—said, “Whenever I see a coin, I’ve learned to turn it over to see the other side.” We need a bit more of that view, I think.

My suggestions for travel in a new country or city:

  1. First, go walking. A lot. For hours. With no goal but to experience.
  2. Invest a few hours in the national historical museum.
  3. Find a local restaurant without using the concierge or guidebook.
  4. Be curious, not judgmental.

We need a bit of that too. Well, I do anyway.

 

The November Carnival Of Trust

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Carnival of Trust logo

Welcome to the Sixth Carnival of Trust. As always, we’ve tried to make this Carnival a little bit special, a little bit more value-adding than the average carnival.

Specifically:

  • There are always only ten selections in the Carnival of Trust. They all earned it. They’re good. Or, at least provocative.

  • We’ve added our own perspective to it—this is not a dry list. In some cases, we even take issue with the post—and say why. You may not agree—but at least we offer a point of view.

  • In each Carnival of Trust, a theme emerges; in this one, it’s policy on trust. Issues of policy and trust in health care, in direct marketing, in marketing, in leadership.

Our aim is to make this interesting, educational and profitable. Let us know how it was for you.

With no further ado, let us move to this month’s winning posts.

Trust in Advising and Influencing Logo

Dr. Bleuel has written a gem of a piece about trust and loyalty. I agree with nearly every word he says—a rare thing. Samples: “Trust is built, one transaction at a time,” “loyalty and trust are not passive states,” and “once I trusted the Audi mechanic, the buying process for service is simple: take the car in and describe the problem.” The good doctor from Pepperdine gets it.

Our next post discusses how to make sense of all the clouds of soft-talk around words like integrity, listening, fairness, authenticity, honesty, and transparency. Read Stephen Hopson’s guest-post on the blog Make It Great. In one page, he integrates them all in a way that—to me—feels just right. He’s an ex-WallStreeter, so you sense he knows how to pile on the BS—and most certainly isn’t doing that here.

Don’t miss his vignette on Bob the stunt pilot.

Nagesh Belludi grew up in Bangalore and lives in Indiana. He’s got a Masters in Engineering, and he speaks on personal effectiveness. He’s invested in stocks since age 16, and he reads about Mary Kay cosmetics’ management style. In other words, just the right amount of schizophrenia to describe how to most effectively give advice and have it taken.

Trust In Sales and Marketing Logo

Kaila Colbin noticed a pattern among heavy-hitter reviewers of search engines—they implicitly rated trust, transparency and honesty higher than the non-collection of data. “If trust is more important than privacy, then a company that says up front, ‘We collect all of your search history and use it to target you directly,’ will do better than a company that says, ‘We will not use your search history for anything other than making our algorithm better, and oh by the way those ads today that match your search query from two weeks ago?’ Implication? “one of the single most critical factors for web businesses over the next few years will be the ability to engender trust.”

Next John Whiteside comments on a MarketingProfs article by Lynn Upshaw of Berkeley Business School. Here’s Upshaw’s original:

Marketers need to consider a new calculus: "return on marketing integrity"which can lead to stronger business performance.

Traditional return on marketing investment is calculated using gross margin generated by marketing efforts (GM), minus the marketing investment (I), divided by that investment: ROMI = (GM – I) ÷ I. The calculation for return on marketing integrity is identical, except that investment is replaced with marketing integrity.

Whiteside’s comment:

I am skeptical. I doubt that you’ll ever be able to show much in the way of financial return on something as subjective as "integrity."

A pox on Upshaw, and a raspberry to Whiteside for getting caught up the whirlpool of absurdity that marketing folk sometimes construct.

Hello—If you make increased quarterly margins the measure of integrity, you just lost all integrity. I don’t know how to say it any simpler than that. So read Whiteside’s piece—which does after all do a good job of laying out the trust in marketing issue—and see if you can figure out how to get the message through. To Whiteside’s additional credit, he also suggests integrity might be an end in itself. All is not lost.

Nancy Arter, direct marketer, believes the following:

…it is imperative for us to market ethically — otherwise, we lose the trust of our current and potential customers. …We strongly believe in creating trust through direct marketing — and that by doing this, you build more profitable customer relationships.

Precisely. Interestingly, she agrees with NY State Attorney General Cuomo, who expanded his student loan investigations to include direct marketing.

But—hold on to your seats—the Direct Marketing Association also agrees with Cuomo.

The Direct Marketing Association (DMA) came out quickly in support of this investigation saying that "illegal marketing activities erode trust for the entire industry." In fact, Jerry Cerasale, SVP of government affairs for the DMA, went further: "If these actions violate the law, then they should be stopped. Legitimate marketers need to have trust in the marketplace, and violating the law undercuts that trust. This is not retail, where you can walk in and touch a product and buy it. With direct marketing, you don’t hold the product until after you’ve bought it, so trust is essential.”

I’m going to have more to say about trust and the role of industry associations. Meanwhile, kudos to Arter, and to the DMA.

London-based marketer/facilitator Johnnie Moore offers two mini-corporate chilling-thrillers about the power that leaders wield, the deference given them by others, and the numbingly bad results that can result. Read it and hope it’s just those chaps in the UK.  ‘Cept you know it’s not.

Can corporate change happen without personal change? Can leaders lead without experiencing? Can a coach be effective without undergoing a consonant change?

Dave Crisp says no, in a concise way. Methinks he’s right.

Trust in Strategy, Economics and Politics Logo

“One of every nine Americans is a member of a WellPoint health plan,” according to Wellpoint’s website. They are joining hands with Zagat’s (yes, that Zagat’s—the restaurant guide people) to create, again from the website, “a new online survey tool that will allow consumers to share their physician experiences with others.”

I think this is a very cool idea. It speaks to the truth about medical decision-making, which is that bedside manner matters enormously compared to technical ratings; and it offers transparency.

Niko Carvounis, on the other hand, thinks it’s a terrible idea, and does a thorough job of making the case. It’s an important issue, and deserves the thoughtful approach Carvounis brings it. It’s a great way to access some fundamental ideas about the upcoming healthcare debate.

Maggie Mahar helps us educate ourselves for the healthcare debate, arguing against health care maven Regina Herzlinger and consumer-driven healthcare. Who is Herzlinger? What is consumer-driven healthcare? Is it right or wrong? Why should you care? Because it also has a lot to do with sales, marketing and trust, that’s why.

Mahar answers all. Except maybe right or wrong; Herzlinger would argue the consumer is a lot smarter than Mahar et al say. Hey, you decide—this piece will help you. (Full disclosure: Herzlinger was a professor of mine, and I’ve written about her previously in Trust, Politics and US Health Care Policy .)

Thank you to these talented authors for providing great insights into issues of policy and trust the sixth Carnival of Trust. I hope you’ll enjoy these articles as much as I have. If so, please leave a comment for the authors on their sites or recommend these articles to others who will appreciate them.

My aim is is to make the Carnival of Trust interesting, educational and profitable. I always appreciate your feedback; let me know what you think in the comments.

For more discussions of the nature of trust, you can check out the Carnival’s previous editions:

Steve Cranford at Whisper hosted Carnival of Trust #5;

David Maister at Passion, People and Principles hosted Carnival of Trust #4;

the anonymous but trusted Editor of Blawg Review hosted Carnival of Trust #3;

Carnival of Trust #1 and Carnival of Trust #2 started of here at Trust Matters.

Have a look at them. If you’re interesting in hosting a Carnival Edition, please let me know. You can contact me at blogging-at-trustedadvisor-dot-com.

Call For Carnival of Trust Submissions

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Every month the Carnival of Trust highlights ten of the best posts on trust, whether business related or not. The next carnival will be Monday November 5th. If you’ve written a post you think would be a good fit, or if you have read a post by someone else that you think would be great for the carnival I’d like to encourage you to submit it for the carnival.

Carnival Submission Guidelines:

  1. The Deadline for submissions is midnight, Thursday November 1st.
  2. Posts do not have to be business related. Trust in personal relationships, politics, or any other sphere of life are more than welcome, and, indeed, encouraged.

Posts can be submitted here.

If you’d like to read a sample Carnival of Trust, bothWhisper and David Maister have hosted editions. I look forward to another excellent edition with your help.

Beta Software You Can’t Trust

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The other day I decided to offer credit card payment capability.  I quickly narrowed it down to two choices—JPMorgan Chase, and PayPal.

Chase was professional and comprehensive, but required me to fill out forms, fax them in, then phone someone a day later. Uh uh, not me.

PayPal offered a cool online menu for creating customized Outlook-generated email with embedded credit card payment links.

I went with PayPal. Then the fun started.

Let’s just say it didn’t work.  I called PayPal tech support.

“Oh yeah, I see. Hmm, you’re right, it doesn’t work. Well, that’s beta software, and we really don’t support it.”
“If you don’t support it—why do you offer it on your website?”
“Well, some people like it. But it’s beta, we really don’t support it.”

Now, I like PayPal.  It’s a business I’d like to see succeed.  Nice technology.  Nice people, good customer service manners, cool techies.

But the end result—in this case—is flakey. Doesn’t work. Undependable.  Can’t rely on it. Untrustworthy in that sense.

And the big sin?  They think it’s OK!  After all, it’s just beta!  What do you expect?

Increasingly, I expect it to work.

PayPal is not alone.  I remember discovering Plaxo, one of the early contact management software updating programs, and thinking, “what a great idea.”  It was being offered in beta test format.

I tried it.  Spent hours on it.  Pissed off several friends.  I called to complain, and the nice/service-oriented/tech-savvy person offered me a free year if I’d come back in a month and try their update.

I did.  It was not updated enough.  I left them, and now here I am saying bad things about them online.  They blew two chances with me, and thought it was OK!

I think it started with Netscape. In its early days, academics and gurus were raving about this new business model that allowed customers to actually contribute to the design. User-friendly! Cutting-edge!

True. But also flakey. Undependable. Untrustworthy.  But they thought it was OK!

I’d be interested in hearing from others, but for my money, the trend has gone way past the equilibrium point. 

I don’t want to help design some trivial widget—I just want the stupid thing to work.

And I certainly don’t want to contribute to testing something I’m going to be depending on—like payment systems, Outlook add-ins, printer driver updates, data converter programs.

The tweaks just ain’t worth it. Dependability is worth it.

We are well past the invention of major new categories. We are into the ability to trust things like we used to trust dial-tone. That is to say, we want 99.9% dependability.  But too many developers still think selling mediocrity-in-progress is OK!

The new killer app isn’t email.  It’s dependability.  Software producers, you’re on notice.  I’m quite happy to pay full retail for a working product; I’m not falling for anymore “get it first” or shareware-priced new software.

I want software I can trust. Software that works.  I’ll pay good money for it.

But I’m done paying you money for the privilege of debugging your marginally-interesting flakeware.

Do your own damn beta.  It’s not OK by me anymore.

Mummers, Trust, and the Threat of Violence

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If you’re like me, you have a (very) vague sense of “mummers.” Or “mummers plays,”  or of Philadelphia’s “mummers’ parade.”
Turns out mummery (or mumming—hard to know what noun form to employ) takes on some curious forms. Particularly in parts of rural Newfoundland.

Check this out:

COLUMBIA, Mo. – Residents of small isolated fishing villages on the northern peninsula of Newfoundland have participated in the ritual of “mumming” for centuries. According to the tradition, small groups of villagers, or mummers, disguise their identities and go to other houses to threaten violence, whereupon the people of the houses try to guess the intruders’ identities.
A study by researchers at the University of Missouri-Columbia argues that this tradition is a manner of communicating trust and trustworthiness. The mummers who threaten violence must prove themselves trustworthy by not committing a real act of violence, and the hosts of the invaded home must demonstrate trust by not responding to threats with fear or violence, said Christina Nicole Pomianek, an MU doctoral student.
“In this ritual, participants are making themselves vulnerable at the hands of the other,” said Craig T. Palmer, assistant professor of anthropology in the College of Arts and Science. “It’s a way for community members to prove their trust and commitment to each other.”

If even remotely true, this is one of those quaint social innovations that is firmly rooted in and serves to elucidate human nature.

There is no such thing as trust without risk, I would argue.  Blind faith is not trust at all, because it rules out risk as irrelevant.  And if you are dealing in probabilities alone, you are similarly not dealing with trust, but with statistics.

Trust exists at that interesting boundary line, where you must take a step forward not being entirely sure that there will be solid ground to support your step.

You’re invaded by dressed-up mummers.  In all likelihood, they are just the boys up the road, doing the halloween-like ceremony.  But there’s always the chance—well regaled in lore—that one or more of them really are out to rape, pillage and burn your house down.  Do you keep one hand on the shotgun?  Or decide to trust?

You’re a dressed-up mummer, going down the lonely dark road in Newfoundland to drop in those strange old folks down the dark road you only see in town rarely. That’ll add some edge to your life.  You mean them no harm, you want to play the game and have a drink after—and make some friends.  But they may have a shotgun handy too.  Do you play the game to the hilt? Or rip off your mask to guarantee your life—but ruin the game?

The Columbia researchers speculate that the timing of the holiday—early winter—supports the need to develop trust during the long cold dark season to come.

How clever—a mutually created mutual threat, almost certain to be resolved—but not quite guaranteed. In order to create trust.

Makes sense to me.

Many thanks to Ed. (short for "editor") of Blawg Review  for tipping me to this; it comes courtesy of Andrew Sullivan’s online column The Daily Dish at Atlantic.com.

Customers and Bottled Water: It’s the Coverup Not the Crime

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Advertising Age presents Martin Lindstrom, at Coca Cola’s home in Atlanta, in his video:
 

Watering Down the Coke Brand?

Admitting the Source of Bottled Water

ATLANTA (BRANDFlash) — It’s surprising how just three letters — "PWS" — can generate such angst throughout an industry as large and savvy as the North American beverage business. But the issue of publicly admitting that bottled water comes from a "Public Water Source" is a huge one for marketers such as Coke. The concern, of course, is that if the consumers know those expensive bottles of water come from the same public reservoirs as tap water they’ll cease buying them. But, in fact, similar experiences in other categories show that consumers will not easily abandon products that have become as much of a habit as bottled water.

Lindstrom talks about Coke’s effort to introduce Dasani in the UK as a pure, pristine water. It’s a message that didn’t go over well when the truth came out (PWS), then took a second hit from a bottling contaminant scandal.

Lindstrom’s tone is bemused. And rightfully so.  As businessmen and politicians are continually rediscovering—it’s the cover-up that hurts you, not the crime. Think Nixon. Jeff Skilling. Larry Craig. OJ.  Monicagate.  Rigas. Mark Foley.  Corvair. Ted Haggard. Dan Rather.  Bhopal.  It’s endless.

And yet—as Lindstrom accurately reports, “The [marketers’] concern… is that if the consumers know those expensive bottles of water come from the same public reservoirs as tap water they’ll cease buying them.”

I know! I’ve got an idea! Let’s just shade the truth a bit.  Not a flat out lie, of course.  Just repositioning.  Images, not words.  Suggestions, hints, juxtapositions, transference, intonations.  Nothing illegal.  No lies, of course.  After all, what do you take us for?

It is shockingly hard for most of us to just tell the truth.  Maybe marketers have just a little harder time than the rest of us?  Maybe their paranoia is just more publicly visible. 

What’s peculiar is—as Lindstrom points out—the truth really isn’t so bad.  Consumers can be quite comfortable buying PWS water. It mainly depends on—whether they’ve been told the truth about it.  The whole truth.  And nothing else.

If we doubt the truth of any part of a message—not just lies, but omissions, shifts, allusions, and particularly motives—then everything begins to unravel. What a tangled web we weave…

Once we doubt someone’s motives, it’s like dominoes—one statement after another gets challenged.  We become cynics.  And we end up not trusting the speaker.

A good case  can be made for Public Water Supply water; it’s not so hard to make.   And it beats the heck out of an implied fake that ends up being discovered for what it is.

A lie by any other name will smell the same.  Like contaminated water.