We tend to imagine salespeople as dynamic, charismatic folks who can sell anything to anyone — the Leo-DiCaprio-in-Wolf-of-Wallstreet types. Their dazzling personalities can make customers just trust them. But the same confidence and optimism that create charisma can also lead salespeople to overestimate how much their customers actually trust them. Inaccurate perceptions of trust can have detrimental effects in any relationship, and this also holds true in the buyer-seller relationship. Salesperson trust overestimation can have substantial negative consequences for both the salesperson and the customer.
In “We are not on the same page: The effects of salesperson trust overestimation on customer satisfaction and relationship performance,” the University of Arkansas’s Judith Anne Garretson Folse, alongside fellow researchers Stephanie M. Magngus, Eli Jones, and Shrihari Sridhar, examines the effects of salesperson trust overestimation and its impact on customer account revenue and word of mouth. In addition to quantifying the negative effects of trust overestimation, the researchers also explore practical strategies that businesses can implement to improve salesperson trust and enhance customer relationships.
The Importance of Salesperson Trust
Trust is a key factor in building and maintaining relationships between salespeople and customers. When customers trust their salesperson, they are more likely to make purchases, provide referrals, and continue doing business with that salesperson. When salespeople overestimate their level of trust with customers, they may prioritize the wrong customers and take certain customers for granted, actions that can lead to reduced customer satisfaction and loyalty.
While salespeople are typically optimistic and that may contribute to how they begin overestimating a customer’s trust, standard business practices can also reinforce this belief. When customers place repeat calls or continue to purchase products from a salesperson, it can be easy for that salesperson to assume that the customer trusts them. However, customers might actually continue returning because of other factors, such as lower price points or product specificity.
Overestimating a customer’s trust can cause salespeople to neglect relationships that still need to be nurtured. Additionally, customers who perceive that their salesperson has overestimated trust may be less likely to continue doing business with them in the future. This issue is particularly relevant in business-to-business settings where long-term relationships are critical for success.
To better understand the impact of salesperson trust overestimation, the researchers focus on identifying and defining salesperson trust overestimation and exploring its impact on customer account revenue and customer word-of-mouth communication. They account for several contributing factors, including asymmetry in information exchange, cognitive biases such as confirmation bias or optimism bias, and social norms within the industry or organization.
By examining moderators like relationship intensity and market dynamism, their research demonstrates that salesperson-customer relationships do not operate in a vacuum. Instead, what’s happening around them will impact them.
To test the conceptual model, researchers conducted a study using surveys from matched B2B salesperson-customer dyads and objective performance data. The results of the study showed that “a 1-unit increase in salesperson trust overestimation decreases financial revenue by $7.89 million and potential referral revenue by $1.12 million, indicating severe negative consequences of trust overestimation.”
Salesperson trust overestimation generally has a negative impact on business, but there are factors that influence the degree of impact. Relationship intensity exacerbates the negative effects of salesperson trust overestimation. The number of interactions a salesperson has with the customer increases their relationship intensity. In an intense relationship, expectations are heightened, so customers who interact frequently with a salesperson expect the salesperson to accurately perceive the qualities of the relationship. Thus, the customer feels even more stung when the salesperson overestimates their trust. This overestimation can cost the company financially and via word-of-mouth referrals.
On the other hand, market dynamism mitigates the effects of salesperson trust overestimation. Market dynamism refers to volatile or unpredictable conditions in the market. During periods of heightened market dynamism, customers may attribute negative outcomes to the market rather than the salesperson, providing an opportunity for sales teams to improve customer relationships. Sales managers should leverage these periods to recalibrate trust in the buyer-seller relationship, ultimately benefiting both the focal relationship and customer word-of-mouth.
Implications for Sales Managers
Based on these findings, the researchers recommend several courses of action for sales managers to address trust overestimation and its consequences. First and foremost, sales managers should actively monitor trust asymmetry within sales teams' customer relationships. This requires periodic checks with customers to ensure alignment and prevent the negative consequences of overestimated perceptions of trust.
Sales managers can encourage top-to-top meetings during periods of high market dynamism, using this time to recalibrate trust and improve the overall relationship. Additionally, implementing systematic processes, such as having salespeople formally rate the level of trust that they believe each active customer has in them, can help identify potential issues before they escalate into long-term problems.
Trust overestimation in salesperson-customer relationships carries significant financial and referral consequences for B2B firms. Sales managers should be attuned to the negative impact of trust overestimation on revenue and word-of-mouth, taking proactive steps to manage trust asymmetry and maintain healthier relationships. By implementing these recommendations and further exploring the research gaps, sales managers can navigate the complexities of trust in B2B relationships, ultimately fostering trust-based partnerships and driving business success.