I watched an interesting story on 60 Minutes last Sunday. A financial marketing expert, Michael Lewis, had detected something strange happening with stock buys. He found that high-frequency computerized stock traders were controlling half the stock market and making tens of billions of dollars in the process. “The US stock market is rigged,“ Lewis stated.
Lewis had a conversation with Brad Katsuyama, a trader from the Royal Bank of Canada who had been experiencing the same problems. When he placed an order for stock, only part of the order would be filled at the current price. The balance of the order would not be available or be available at a higher price.
When the two talked, Brad realized that he was not alone in his experiences. Brad decided to pursue this problem and hired an Irish telecom expert on fiber optic networks, Ronan Ryan, to assist. Ronan discovered that someone regularly detected the orders while they were in progress, bought the stock, and drove up the price. The traders doing this were using a faster electronic route. Ronan offered a solution of rerouting the orders, which worked.
Based on that success, Brad quit his job with Royal Bank of Canada and started a new stock market, IEX, the investor’s exchange. In this stock market, traders are not subjected to increased prices or incomplete orders. He approached several large hedge fund operators and financial companies, including T.Rowe Price, The Capitol Group, Fidelity, and Vanguard, to explain the problem and his solution. When they grasped what was happening, they were shocked. One said, “I knew something was wrong, but no one had told us.”
Many have signed up for the new stock market as a result.
How has Brad been able to establish his new stock market quickly? Lewis notes, “When someone walks in the door who is actually trustworthy, he has enormous power. And this is the story, the story of trying to restore trust to the financial markets.”
Brad has been amazed at the response. “We are selling trust. We are selling transparency. Who would have guessed that trust could be a differentiator in a service business?” he remarked.
Sadly, today people are yearning to deal with companies they can trust. Customers encounter too much manipulation and skimming. They deal with too many companies who focus on the company rather than the customer. Management at those companies doesn’t embrace developing profitable customers for long-term success. They are taking all the money they can amass today with no thought of the customer tomorrow.
Your focus on what’s in it for your customer is important to your customer. Check that you and your employees are communicating this focus in what you do and say. Don’t do it by saying, “You can trust us.”
Do it by telling the truth about a customer’s problem and offering a solution that benefits the customer. Just as Brad did, communicate trust by actions and focus.
This week's marketing trivia challenge is What experience have you had where trust was the differentiator? E-mail me your answer.
Lewis had a conversation with Brad Katsuyama, a trader from the Royal Bank of Canada who had been experiencing the same problems. When he placed an order for stock, only part of the order would be filled at the current price. The balance of the order would not be available or be available at a higher price.
When the two talked, Brad realized that he was not alone in his experiences. Brad decided to pursue this problem and hired an Irish telecom expert on fiber optic networks, Ronan Ryan, to assist. Ronan discovered that someone regularly detected the orders while they were in progress, bought the stock, and drove up the price. The traders doing this were using a faster electronic route. Ronan offered a solution of rerouting the orders, which worked.
Based on that success, Brad quit his job with Royal Bank of Canada and started a new stock market, IEX, the investor’s exchange. In this stock market, traders are not subjected to increased prices or incomplete orders. He approached several large hedge fund operators and financial companies, including T.Rowe Price, The Capitol Group, Fidelity, and Vanguard, to explain the problem and his solution. When they grasped what was happening, they were shocked. One said, “I knew something was wrong, but no one had told us.”
Many have signed up for the new stock market as a result.
How has Brad been able to establish his new stock market quickly? Lewis notes, “When someone walks in the door who is actually trustworthy, he has enormous power. And this is the story, the story of trying to restore trust to the financial markets.”
Brad has been amazed at the response. “We are selling trust. We are selling transparency. Who would have guessed that trust could be a differentiator in a service business?” he remarked.
Sadly, today people are yearning to deal with companies they can trust. Customers encounter too much manipulation and skimming. They deal with too many companies who focus on the company rather than the customer. Management at those companies doesn’t embrace developing profitable customers for long-term success. They are taking all the money they can amass today with no thought of the customer tomorrow.
Your focus on what’s in it for your customer is important to your customer. Check that you and your employees are communicating this focus in what you do and say. Don’t do it by saying, “You can trust us.”
Do it by telling the truth about a customer’s problem and offering a solution that benefits the customer. Just as Brad did, communicate trust by actions and focus.
This week's marketing trivia challenge is What experience have you had where trust was the differentiator? E-mail me your answer.
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