According to a 2013 Gallup poll, 60% of American consumers feel dissatisfied with big corporations. As to the points leading to consumer dissatisfaction, some may be due to common business trends such as government bail-outs, illegal data sharing, and even bold-faced lying.
As a result of such practices, even reputable companies, large or small, must work harder to create consumer trust and loyalty.
One way to improve customer loyalty is by creating a transparent business model. Modern consumers want to build relationships with companies that are direct, personal, and transparent. Transparency is effective for the following reasons:
- It shakes off the impression of greed. Movements such as Occupy Wall Street indicate that middle class consumers are wary of greed. To shake off the perception of being greedy, work to communicate both the good and bad to your clients. Do this by sharing business mistakes and successes—as well as opinions of happy and unhappy customers.
- It creates better personal relationships. When customers relate to your business, they are more likely to see past the “corporation.” Whether you run a small or large company, personal relationships are those that last. Being transparent helps you establish relationships long term.
- It attracts skilled and loyal employees. One side effect of transparency is an enriched hiring pool. Because of its reputation for open and honest communication, your company will attract talented, valuable, and loyal employees.
In other words, transparency doesn’t just make for ethical business, it makes for smart business.
Success Stories of Transparent Businesses
If you still don’t believe that transparency can boost your business, take a look at these success stories:
It’s not easy to find a retail company that is transparent with employees, buyers, and vendors. Online shoe store Zappos is an exception to the rule. Since their founding, they have fostered innovative ways to create transparency.
Most notably, Zappos created an employee-written blogosphere. Within this forum, readers stay up to date on the inner workings of the entire business. Zappos even made public this letter from CEO to employees when the company was bought by Amazon.
AT&T is a prime example of a company that uses social media to create transparency. After a service outage in San Francisco and Silicon Valley, AT&T immediately turned to Twitter. They used this platform to share news and provide continuous updates to consumers in the Bay Area.
Since that 2009 event, AT&T’s number of Twitter followers has jumped from 2,400 to 655,000. In large part, this success may be due to the company’s transparency.
3: General Motors
GM as a transparent company? This may come as a surprise, especially considering GM’s challenges following its 2008 government bailout. Since that time, however, General Motors has made efforts to create a more transparent business model.
Specifically, GM now shares its government repayment schedule alongside company news on its corporate blog. As a result, consumers have renewed their trust in the business.
As you can see, transparency can be effective in any industry. By creating a transparent environment, these companies were able to
- Establish a platform for trust
- Create loyal B2B and consumer relationships
- Build loyalty
If these three achievements are on your to-do list, transparency is a quality worth your renewed efforts.
Tips for Getting Started
It doesn’t matter if you start small or go big. Here are a few ways to promote a transparent business atmosphere:
- Create internal transparency by clear communication with employees.
- Be transparent about mistakes and setbacks.
- Inform clients and team members about pending changes.
- Be truthful and simple with guarantees.
- Explain the cost and value of your product or service honestly.
While seemingly subtle, transparency as a business quality can take your company to the next level. However, it always starts with internal transparency. Only then will you be empowered to make radical, company-wide changes in transparency.
Take your cue from the above businesses. You can create a transparent business and move forward towards future success.
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