What it is and how it works

The board surveys nearly 5,000 households in the United States to assess their attitudes toward spending or saving. Then, they publish a monthly report that provides insight into economic conditions and predictions for the coming month.

Here is how CCI is measured at different levels:

• Survey creation. The CCI survey consists of five questions about people’s current situation and future expectations. Respondents can choose from three options to answer a question: affirmative, negative, or neutral
• Calculate the relative value. After collecting all the data, the positive answers to each question are divided by the sum of all positive + negative answers. It gives the relative value for each question, which is compared to the relative value from 1985 (the original benchmark for the CCI).
• Explanation. The average of the relative values ​​of the five questions becomes the consumer confidence index. Index values ​​of >100 indicate high confidence levels and economic growth. On the other hand, an index value below 100 indicates a recession with less willingness to spend.

With this detailed breakdown of the Consumer Confidence Index, it’s time to address the big question: Is CCI even important for business?

Why is consumer confidence important?

Consumer confidence can directly affect business growth. A high confidence index means people are willing to spend more and increase spending. This can improve sales, increase revenue, create jobs and create a sustainable growth loop.

If you’re wondering about the CCI’s impact on your business, here are four ways a high confidence index can benefit a business:

• Higher sales and revenue. When people feel financially secure, they are more willing to spend money. This can unlock new revenue streams for businesses and drive more conversions.
• Business expansion. A continued positive buying sentiment means businesses will have enough cash flow to expand their operations. You can hire more employees, open a new branch, enter new markets or add more product lines/services.
• Greater customer loyalty. A high CCI promises customer retention because customers may continue to buy from brands they trust. You have the opportunity to build long-term relationships with repeat buyers.
• Stable workforce. Another big advantage for companies operating in a high-trust environment is the ability to stabilize their workforce. You don’t have to hire quickly or lay off people, and instead focus on mutual growth.

Simply put, CCI can have a domino effect on the economy and your business. A positive indicator can create opportunities for hypergrowth, but a negative indicator can push you into recession.

So, what can you do to increase people’s trust in your brand? Find out.

How to increase consumer confidence in your business

I spent days researching what businesses need to build and maximize consumer trust. Here are four best practices for increasing people’s trust in your brand

1. Maintain an authentic brand image.

The more people trust your brand, the more likely they are to buy from you. You can build this trust in a few ways. Let’s break them down.

transparency

Give people an unfiltered, unedited view of how you make your products or deliver your services. For example, if you’re a B2B SaaS company, you can talk about the behind-the-scenes process of building, and if you’re an ecommerce brand, you can talk about how your product is made.

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Brand value

Among consumers, 84% buy from brands whose values ​​align with theirs. People will resonate more with your brand when they know you are committed to making an impact in society. So, spotlight your values ​​at various touchpoints in the buyer’s journey so that buyers can trust your brand.

Take a page from H&M’s book with their message about sustainability and their mission to build a circular economy.

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Social proof

Another great way to build consumer trust is to create social proof. This is because people trust brands when they hear a friend or acquaintance endorsing them You can work on word-of-mouth marketing or use social proof strategically to win customers’ trust.

Building a trusted brand image is a good place to start your efforts to build consumer trust. Once the foundation is in place, you can implement these best practices to double that progress.

2. Simplify the buying experience.

With so many options available to your target buyers, you can’t go wrong with the buying experience. The slightest friction in this journey can send people away, looking for alternatives.

That’s why you need to make the buying process as easy and seamless as possible.

Here’s a simple checklist I created after observing the most effective shopping journeys from discovery to purchase:

• Website navigation. Make your website so easy to navigate that people can shop while they sleep. Instead of searching frustratingly, it should give customers what they need in a few clicks.
• Clear price details. Be transparent and share your pricing information upfront to help people make an informed buying decision. You should avoid complex price points to avoid confusion.
• On-demand support. Offer round-the-clock support or create a self-service support model for people to find relevant answers whenever they need them.
• Convenient checkout. Make checkout a breeze without making people jump through hoops. You can add a guest checkout option for faster ordering.
• Multiple payment options. Given that at least 15% of consumers expect high payment variety, you should add different payment options to maximize conversions. Here is an example of Cleartrip offering different payment methods:

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3. Embrace consultative selling.

Rule of thumb for modern business: People don’t like being sold to. Gone are the days when pushy sales tactics could close deals and drive sales. Today, customers expect more meaningful relationships with brands.

Instead of blatantly promoting your product/service you need to focus on solving real pain points. This is called consultative selling, a demand-based selling approach where you act as a helpful advisor, trying to provide appropriate solutions and build a relationship.

Here are some ways to take advantage of consultative selling to increase consumer confidence:

• Listen carefully to your audience and understand their pain points.
• Share user-generated content to make your solution relevant to their use cases.
• Ask questions and encourage people to open up about their challenges + expectations.
• Share helpful resources tailored to specific challenges to educate and guide customers
• Proactively support customers to resolve queries and seek feedback after purchase.

This post from Fable&Mane provides a great example of an existing customer showing how he uses one of their products and how it benefits him.

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4. Provide compassionate support.

Customer support is an important link in building consumer confidence. If you want people to keep buying from your business, you need to focus equally on their post-purchase experience.

You can start by training your support team to listen carefully, validate people’s feelings, and respond with empathy. As part of the training program, you can host role-playing sessions, create support materials, and run mock sessions to help the team convey this message.

Apart from direct support, communities are one of the best channels to support and delight customers. Our Consumer Trends Report suggests that 19% of respondents have joined an online community, and at the same time, 24% have actively participated in one. A thriving community can become a channel for support and a lever for growth.

You can also use social channels to provide proactive support and resolve complaints.

Chewy’s support team provides an excellent example of how this is done. They engage with people who refer them on social channels and go the extra mile to help customers.