New beginnings: why the death of trust could be good news for your business
One of the best things about being on holiday, in my view, is the opportunity to indulge in little luxuries guilt-free. Like afternoon naps, 5pm “wine time”, or finishing a book in two days – just because you can.
I indulged in all of the above over the Christmas-New Year break, the book being Mitch Albom’s ‘The next person you meet in heaven’, the sequel to his acclaimed ‘The five people you meet in heaven’ and equally captivating.
One of the key themes from the book that resonated with me, perhaps due to the time of year, was that every ending is also a beginning – we just don’t know it at the time.
So as we launch into 2019, I thought it fitting to reflect on a few significant events that occurred in 2018, that simultaneously destroyed consumer trust and created new opportunities for businesses that are open and willing to change.
The Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry
The public hearings may have concluded in 2018 but the ramifications for the industry are far from over. With Kenneth Hayne’s final report due to be submitted to the Governor-General in February, companies are bracing for further criticism and introspection as they seek ways to rebuild trust with consumers and change cultural norms inside their organisations.
“How do you deduct a premium for life insurance on a life that’s dead?” – Kenneth Hayne
We’ve already seen changes to industry structure and remuneration, and the abandonment of products and practices that, quite frankly, should never have existed in the first place. But the hard work is yet to begin.
As the interim report handed down in September rightly pointed out, new laws don’t change behaviours, they simply add complexity. Behavioural change is driven by the belief systems within an organisation – the values, purpose and direction of the organisation that are set, communicated and reinforced by those at the helm.
Financial services businesses must embrace the lack of consumer trust as the new normal, and use it as an opportunity to build strong, customer-focused cultures.
The announcement of a Royal Commission into Aged Care
While financial services companies are licking their wounds, aged care companies are preparing for their own royal commission wringer.
On Christmas eve, as many Australians were preparing the Christmas ham, an email hit inboxes inviting interested parties to make submissions to the Royal Commission into Aged Care Quality and Safety.
Hearings will commence in February in Adelaide, and will continue throughout the year. While this will no doubt be a challenging time for providers, customers and family members alike, it will spark a much-needed conversation about the future of aged care in this country, and how we can improve outcomes for older Australians.
The reality is, there is little dignity in ageing. I’ve recently been given insight into the cruelty of Alzheimer’s, having watched a school friend support her mum from diagnosis of early onset Alzheimer’s in her early 50s, to the final goodbye on New Year’s Eve approximately a decade later.
Her final years were spent in a high end facility of a well-known provider in Perth. While the care she received was by all reports exceptional, her daughters knew it was not somewhere she would have wanted to spend the end of her life. But was a place in which she could receive the level of care required as her condition deteriorated.
The current aged care business model has to change to meet the evolving needs and expectations of Australian consumers.
The residential model and structure is outdated, and future customers – the Baby Boomer generation and beyond – are unlikely to be satisfied with the institutionalised nature of care currently available via residential facilities.
Putting the spotlight on aged care via a royal commission provides an opportunity to drive innovation from the bottom up. To find out what is working and what isn’t, and to determine what we are willing to accept as part of the ageing process and what we’re not. To destigmatise ageing, prioritise and promote continued health and wellbeing in later years, and set the foundations for people to live better lives for longer.
New data privacy laws took effect
The deterioration of trust was a strong theme in 2018, with Edelman’s Trust Barometer revealing people’s trust in business, government, NGOs and media lies in distruster territory in 20 of the 28 markets surveyed including Australia.
2018 saw a renewed focus on data privacy and security among companies, driven by intense publicity and scrutiny around events like the Facebook-Cambridge Analytica data scandal and British Airways data breach, as well as the introduction of a number of new laws aimed at better protecting individuals.
“Just because something is publicly accessible does not mean that people want it to be publicised” – Making Sense of Privacy and Publicity
Australia’s Notifiable Data Breaches Scheme took effect in February, while Europe’s General Data Protection Regulation law (GDPR) came into force in May. Companies are now acutely aware of both the value and risk that comes with amassing large amounts of personal information from customer interactions, and will be held to account when they fail to uphold their responsibility to consumers to stop this data from falling into the wrong hands.
Data breaches are just another hit to the already depleted consumer trust bank, but while the new laws bring greater reputational risk for companies, they also create opportunities to turn our attention to the ways in which data can help us get closer to our customers.
The use of data and predictive analytics for CX has become mainstream, as companies seek to harness the power of insight to retain, acquire and better service increasingly empowered and engaged customers. This is a trend that’s likely to continue in 2019 as consumers increasingly expect one-to-one sales and marketing and a personalised customer experience, and businesses use data to compete and win.
Mitch Albom is not the only person to have mused about endings and beginnings; in my high school years, a band called Semisonic released a song called Closing Time, which subsequently became the theme song for our Year 12 final assembly.
In it, Dan Wilson sings ‘Every new beginning comes from some other beginning’s end’.
We have reached a tipping point in the Age of the Customer; in my mind, 2018 marked the death of trust. It’s harder to earn the right to have the conversation with your customers; it’s harder to keep them listening; and it’s harder to stop them from walking away.
But arguably, with all the new tools at our disposal, it’s easier to create fantastic customer experiences. So if the death of trust means the birth of new and better customer experiences, then I say: bring on 2019.
Kristen is a highly motivated and passionate researcher with nine years' experience in the market research industry. As Director of CoreData Western Australia, she is based in our Perth office and responsible for business development, client relationship management and project management across a diverse client base.
Kristen has a deep understanding of the financial services industry, strong client engagement skills and is a regular media commentator. Her Perth client base spans aged care, banks, super funds, not-for-profits and utilities.
Kristen is a graduate of the Australian Institute of Company Directors, has a Master of Business Administration (Exec) from the Australian Graduate School of Management, a Bachelor of Arts, Journalism (with Distinction) from Curtin University of Technology and is a fully accredited member of the Australian Market and Social Research Society of Australia.