ARTICLE TEXT:
ARTICLE
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"A
MATTER OF TRUST
Confidence.
It is the aphrodisiac of business.
It
is the reason so many economists' forecasts are so wrong,
so often. Bland statistics, economic modelling, historical
records and trend lines do not recognise, respect or factor
in the inherently important role and impact of confidence
in the buying, investment and developmental decision making
of the overall marketplace.
Economists
need to study and better understand the emotional drives
of key stakeholders rather than simply the mechanisms of
the marketplace. To do so, may well be a Nobel pursuit.
Confidence
is the focus, outcome and essential that is deficient in
a huge majority of current advertising and business dealings.
Emphases on product, price and finance no longer stimulate
and sustain significant increments in demand, revenue, margins,
profit, and above all, consumer and client confidence!
What
happened to identifying needs, fulfilling them, projecting
a compelling ambience and featuring a great, positive buying
and transaction experience? Are we so devoid of creativity,
energy, enthusiasm and pride? Is the art of selling a lost
skill set, replaced by the single dimension declaration,
“we wont to be beaten on price”.
ANIMAL
INSTINCT
Animals,
domestic pets in particular, can detect confidence, or a
lack of it. That, seemingly, is a sixth sense which is possessed
and exercised by contemporary consumers and clients.
Interestingly,
the typical instinctive response to hesitancy by prospective
buyers of offering a lower price actually stimulates a loss
or lowering of confidence.
Many
consumers are seeking advice and recommendations about alternatives
rather than cheaper prices. That is the underlying rationale
of asking questions, many of which sales and service people
do not hear, comprehend or respond to.
INFORMED
CONSUMERS
The
internet has been the instrument and inspiration for many
changes in lifestyles, expectations, education, communication,
commerce and confidence.
Ready
access to information has empowered consumers and clients
at large. They are discerning, demanding and sadly, in many
instances, possess better product knowledge than sales and
service providers.
Confidence
in a company brand, product, service and person can and
will plummet in such circumstances.
VOLATILE
EMOTIONS
Confidence
can be and is influenced substantially by the media and
the 24 hour news cycle. Headlines regularly are the catalysts
for demand surges for retail petrol on the “news” that prices
are going up imminently. Likewise, bookings for airline
tickets can and do dry up with media reports about safety
issues.
Media
releases about the pending launch of a new model motor vehicle
impacts on sales enquiries, regardless of consequence of
the impact on confidence, for people wanting to make the
best possible decisions, avoid making a wrong decision and
pursuit of a sense of “peace-of-mind”.
“Peace-of-mind”
is a term which is interchangeable with the word confidence.
All people in business, financial planners, developers and
home builders in particular, need to truly embrace the role
of being a “confidence builder”.
BROAD
HORIZONS
High
levels of confidence provide for and facilitate longer term
horizons in the typical buying cycle. They are also an effective
insulation against the volatility of market forces, which
typify a lack of confidence.
One
key and fundamental consequence is stability in cash flows.
That then enables better planning for and the deployment
of resources, including staff, inventory and communications.
Individually and collectively, these contribute to greater
efficiency, effectiveness and profitability.
MULTI
LAYERED CONFIDENCE
Consumer
and client perceptions, images and motivations are not single
dimensions. Each is complex and often integrated with numerous
variables.
A
good example is that of Telstra, the Australian telecommunications
company. The Board of Directors has been forthright in maintaining
and projecting adherence to an annual dividend payment total
to shareholders of 28 cents. That is reassuring to those
shareholders whose primary investment criterium is dividend
receipts.
However,
for those seeking capital growth or a positive mix of stable
dividends and capital growth have a pronounced reluctance
to invest in Telstra. From a list price of $7.40 per share
at the time of the third tranche of Telstra shares the current
value languishes at around $2.75.
Hence,
confidence is a complicated master or a slave which is difficult
to master. Nonetheless, it is an important ingredient in
the mix of success factors in any or all businesses, products
and services.
