When speaking to customers, it is tempting to try and make your company seem as appealing as possible. This occurs most often in sales scenarios but it does bleed into customer support interactions as well.

But is honesty really the best policy? Should you be hiding some truths from your customers in order to make the business look better in their eyes? Can a little white lie truly hurt you in the grand scheme of things?

It absolutely can.

Always always always be honest with your customers. Radically honest. When you’re honest about your company, for both the benefits and some of its weaknesses, you can create a far better customer experience and build a level of trust that is rarely enjoyed between buyers and the businesses that they frequent.

But why should you be 100% honest when speaking with your customers? What benefits could you reap by doing so? And what could happen if you’re not?

Customer relationships

Customer relationships are essential to the continued success of a business. But look at that phrase one more time. Customer relationships. It’s not just a cute term. Customer relationships are called relationships for a reason.

Much like a personal relationship, trust is the essential building block from which a healthy customer interaction is built from. That’s because all relationships rely on honesty.

A customer has to be able to trust you in order to do business with you. That old adage about lies growing and growing until they are as plain as the nose on your face is actually true. That’s why lying about a product or service that you offer benefits no one.

Sure, it might work out in the short term, but eventually, you will be found out and any trust you’ve built with that customer will be completely wiped out.  Unfortunately, once trust is broken, whether it’s in a business or personal relationship, it’s impossible to ever fully get it back.

These sentiments were echoed by Vanessa Merit Nornberg, the president of Metal Mafia and a veteran salesperson with a wealth of experience. She went on to explain an issue where she was told by her boss that she had to push a certain piece of jewelry on her customers that she herself did not like.

“When I picked up the phone to the first customer of the day with my boss standing over me, I went with my gut instinct, to be honest, and told the customer ‘We have a new product that I’m supposed to tell you about today. Personally, I think it is the ugliest piece of jewelry I’ve ever seen, but I’m going to tell you about it anyway, just in case you think you have customers who will believe otherwise.’ My boss was red with anger, but the customer laughed and decided to buy some. My forthrightness had won his trust, and opened the path to what became a long and prosperous relationship.”

Set expectations that you can deliver on

Whether it’s a sales or customer support issue, it’s important to set realistic expectations when dealing with a customer. The problem with making promises that you can’t keep is that eventually, a time will come when the customer will realize that you were lying to them.

That’s why skipping over bad news is counterproductive. Sure, it’s certainly tempting to bend the truth in order to close a sale or get a frustrated caller off the phone because you want to leave for the day. However, actions have consequences and if you’ve set an expectation in the mind of a customer that cannot be delivered on, your business will suffer for it.

When the customer realizes that they were lied to they will be understandably angry, potentially to the point of demanding a refund.

That begs the question, what’s the point of bringing in business that you can’t retain? Retention is incredibly important to the success of a business and once you gain a reputation as a liar within your industry it will be nearly impossible to hold onto your customers. You can kiss retention goodbye and with it your most direct path to success.

Sales that are built on lies or customer service tickets that are resolved by bending the truth will drive customers away from you and you will be forced to expend more resources trying to replace them.

With the help of a trouble ticketing system,  you can track the detection, reporting and solving of tickets that are raised by customers. This helps you from not missing out on customer issues which in turn will help you retain your customers.

This is counterproductive to the running of a successful business. It actually costs seven times more to bring in new business than it is to retain existing clients.

That means that your margin for profit will be skewed due to the added expenditure of trying to recreate your base from scratch. Then, if your issues with honesty don’t correct themselves, you’ll find yourself back at square one in just a matter of time.

This is especially frustrating when you stop to think about just how essential customer retention can be. Increasing your retention rates by just a measly 5% can lead to a whopping 25% increase in profits. When it comes to retention, a little bit goes a very long way.

The key to increased retention is the stellar customer experience. That’s what keeps your audience coming back for more. Lying utterly destroys the customer experience and kills any credibility or loyalty that your brand has built.

“The reality is, most customers know that no product or service is truly flawless or one-size-fits-all,” Merit Nonberg said in her blog. “And as customers, we’d rather have all the facts upfront–the good, the bad, and the ugly–so we can decide which issues we can live with and make an informed buying decision. Being completely honest with a potential customer is crucial to building trust and it is a powerful tool to winning you the sale more often than not.”

She went on to recount an experience within her own company where a salesperson was able to improve a customer relationship by simply telling the truth.

“A newly hired sales rep at my company recently had to dash a customer’s hopes that an item she had wanted to order would be back in stock in time for a big promotion she was planning at her store. The rep hesitated and told me she thought the customer was going to cancel the order. I told her that truth is the crucial foundation of every transaction and encouraged her to be clear with the customer. The customer thanked her for telling her the item would not be available, and instead of canceling the order, asked for her recommendation on replacements, and ended up spending more with the rep because she appreciated her advice.”

Honesty restores faith

No company is perfect, and customers understand this. To that end, you have to remember that problems will pop up, and when they do it is not the end of the world. Some issues are obviously larger than others but when you are faced with an issue that could impact customer satisfaction, honesty goes a long way toward mending those fences. 

When you’re dealing with issues such as outages, data breaches, and other obvious customer-facing issues, the worst thing that you could do is lie about it. Once you’ve found out (and you will be) your reputation will take a major blow.

In 2018 the ride-sharing company Uber put a permanent black mark on its reputation when it was forced to pay over $148 million in fines after a failed attempt to cover up a massive data breach that rocked its system. More than 57 million users had their data compromised in this immense scandal.

Instead of being honest with their customers about the breach, Uber paid the hackers a ransom of $100,000 to try and keep them from releasing the information, all the while remaining silent toward their impacted customers.

California Attorney General Xavier Becerra commented on the scandal by saying, “Uber’s decision to cover up this breach was a blatant violation of the public’s trust. The company failed to safeguard user data and notify authorities when it was exposed.”

This is why it is so important to be proactive in the face of a horrible issue, like the one that faced Uber in 2018. When these situations pop up, it’s best to get out in front of it and try to ease the reaction of your audience. (And certainly don’t pay a ransom!)

When you own your mistakes with humility, it helps to restore a customer’s shaken faith in the organization. When you proactively reach out to the customer, you should immediately tell them how you plan to make this issue right.

By alerting them early, you’ve controlled the narrative. If you communicate with them early enough, you might even be the one to break the news, immediately softening the blow with a proposed solution and a hefty amount of apologizing.

All this could be done with a perfect customer communication management platform that comes handy with multiple features needed for the entire customer management process. Letting a customer discover outages or other massive issues on their own leads to emotional reactions that can steamroll their trust in you and your entire company.

Merit Nornberg detailed another such instance where someone calling into her company was angry that a piece of jewelry they ordered was not able to do what it was advertised to do.

“I told her I realized the photo might seem misleading. Then I really surprised her by saying ‘I completely understand why it’s disappointing to not have known this in advance, and moreover to be told by a company that you’ve spent money with that you now have to go out and do something extra to use a piece of our jewelry the way you wanted to. If you want to return the order, you absolutely can.’

My honesty calmed her, and let her know that she was not backed into a corner, holding on to something she did not want. She asked questions about the modification she could make herself, and ended by saying that she loved our company. I thanked her and asked if she wanted to return the pieces, so I could help arrange a credit. She laughed and told me ‘No. I don’t want to return them. I actually want to buy more. Now that I know what I have to do, I can do it, and I think they will sell well.’”

Truth breeds loyalty

Retention is built from brand loyalty. Loyalty is bred from the trust. Without trust, a chain reaction is set off that shatters brand loyalty and makes any thought of customer retention an empty dream. 

When a customer trusts that your company will do what is right, they will stick with you through thick and thin. After all, why switch to a new company if the one that you’re using is honest and serves you well?

Mechanics are a prime example of this phenomenon. When someone finds an honest mechanic, not only will they never take their car anywhere else, but they will also recommend them to friends and family members. This is brand loyalty at play, built on a sense of trust. 

When it comes to B2B customers, trust goes even further. When a company invests in a service it does so with vital capital. If you somehow violate the trust of a B2B client they are likely to pull away fast because they trusted you with the future of their company and you completely let them down by withholding the truth.

Merit Nornberg spoke about the importance of trust between consumer and business:

“Customers want to know that the company they are considering transacting with is truthful. Truthful in the promises it makes, truthful in the service it offers, and truthful in accepting responsibility for its mistakes. Establishing this honesty is the best way to make a prospect comfortable–and when customers feel comfortable their assurance usually results in a purchase.”

Honesty when speaking to customers is a must

In the realm of business, always be radically honest with your customers. You owe it to them to provide a safe and trusting environment. It’s never a good idea to make a sale or save a customer based on a lie or a half-truth.

Eventually, your dishonesty will drive them away forever and tarnish your reputation in the process. Foster trusting business relationships with your customers and they will continue coming back to you for years to come.