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1/ Anytime you are buying a good or service, there is always information asymmetry between buyer and seller.
2/ The seller always knows the product better than the buyer, it's their job after all.
3/ When your business first engages with a prospect, you have to establish trust with them to overcome that asymmetry.
4/ Sometimes that trust is passed on from someone else (a referral) so that they are willing to buy in spite of the information asymmetry.
5/ Sometimes, you do some education about the good or service which reduces the information asymmetry and gets to trust you
6/ Content marketing is the result of the internet making it easy to do this education at scale.
7/ This means it is increasingly possible for businesses build up a trust account with prospects. (A trust account is just a helpful metaphor for me in thinking about "brand equity" or "goodwill.")
8/ Every product someone buys from you has a trust conversion coefficient - it can greatly increase or greatly decrease their trust in the business (or more likely, somewhere in between).
9/ If a product exceeds expectations of the person that paid for it, then trust in the brand increases.
10/ What was perhaps most astonishing about the first iPhone was not how well it sold, but the fact that it made so many buyers wanted to give Apple more money and tell their friends to do the same.
11/ The first iPhone so exceeded expectations that Apple not only made a bunch of money from it, but they added to their trust account with customers.
12/ In theory, you would like for all your products to do the same (and it's worth striving for), but, in practice, is extremely difficult.
13/ However, at the very least, you want your trust —> $$$ conversion rate to be as favorable as possible to maintain brand equity.
14/ I think it's helpful to think about the value of a business as the balance in the trust account + the balance in the bank account for a business.
15/ You want that total number to keep increasing. The mistake that comes from short-term thinking is that "it's profitable so it's working" is sometimes a result of reducing the trust account faster than you are adding to the bank account.
16/ Of course, you can't pay your vendors in trust (though you can get better terms) so you have to make the conversion at some level.
