Category: Trust Pattern

Posted on by Ron Hofer

Trustpattern #004 „Eternal trial phase“

FUNK offers an APP-based telecommunication contract which can easily be paused, adjusted or even canceled on a daily basis.

„You can end our collaboration any time with a days notice!“

A brilliant offer my colleague Willi Schneider – an Interim Manager – always mentions in his first meeting with potential new clients. Usually consultants are eager to work based on long-term retainers – so why does he offer this option – obviously to his disadvantage? He creates trust in the early phase of the customer relationship:

  • He proved that he is convinced in the quality of his work and therefore they can be convinced as well (you could cancel but you won’t!)
  • He offers a „trust retainer“ towards his clients – which makes the client’s trust in him grow (you could book me out for the next year just in case and then cancel after some days – but I trust that you handle our relationship with care)
  • He eliminates so called „trust friction“ in their decision making (can we really trust in his competence and intention? – well we can cancel anytime if he promised too much!)

One of the key drivers to be seen as trustworthy is communicated self-limitation – obviously to ones disadvantage.

It’s like the gesture of two open hands held up. It makes you pretty vulnerable and limits your ability to defend yourself IF the other person would have the intention to harm you. It communicates „you can trust me“ (because I trust you). Same with offering your hand for a handshake. You show that you trust the other person – and at the same time increase your trustworthiness. You offer kind of a trust retainer which triggers feelings of trust at the counterpart – a fascinating interrelationship of trust.

The „eternal trial phase“ pattern is using this phenomenon. Especially in the initial phase of relationships, when both partners try to figure out, if they should collaborate, we usually demand commitment before access.

In commerce, we invest trust (with a payment, our data, our efforts, our time etc.) based on promises made (Marketing). We need to trust, that what we experience after we commit ourselves is what was promised. This creates an uneven trust balance – we have to invest trust without the other party doing the same. This seems to work mainly due to a general trust into legislation and laws which make us assume that we don’t get tricked.

The trust pattern „eternal trial phase“ redesigns this uneven trust balance towards a system in which the buyer’s commitment can easily be withdrawn anytime in the relationship – to the disadvantage of the selling partner.

Freenet’s revolutionary FUNK App is based on the „eternal trial phase“ trust pattern.

With the FUNK APP, Customers can switch, cancel or downgrade as they wish whenever they feel unhappy with the overall Freenet experience.

In comparison to the standard 24 month contracts customers are used to sign, the FUNK APP idea appears to be a rather vulnerable business model .
But from a Marketing perspective, the FUNK APP seems genius to me! Freenet understood, that the standard 24 month contracts are often seen as an unfair trick telcos use to rip off their clients. Offering the „eternal trial phase“ – customers’ trust friction is reduced to a minimum – allowing a smooth purchase decision.

The FUNK APP’s main objective is to communicate trustworthiness. The message is clear: there is no need to trust Freenet beforehand. „As we are absolutely convinced of the value we offer, we can make the verification and (if needed) cancelation of our offering extremely easy – „no strings attached“.

The „eternal trial phase“ pattern …

  • reduces initial trust friction
  • eases decision making
  • triggers a trustful relationship right from the beginning
  • and customers appreciate it. They pay slightly more (The FUNK APP offer sums up to about 30,- € a month for the premium package) as long as they want to be commited.

I am convinced that this new way of selling telco contracts will result in an extreme increases of new customer acquisition and – although made as easy as possible – will decrease the customer churn rate.

What about your offering?
How could an „eternal trial phase“ offering look like in your industry?
Get in touch and we will figure it out!

Posted on by Ron Hofer

Trustpattern #003 “Hidden delight”

What Marketeers most often don’t sell is what the consumer might want in the future

When we started offering discounts for special clients at the digital consultancy USEEDS° I founded in 2008, we used two discount alternatives. The first discount scheme seemed to be the industry standard. You define a discounted retainer with the client – a fixed minimum amount of days or EUROs they would have to order in the years to come. The alternative discount scheme was a discount percentage which increases, the more a client orders within a period of time – without any obligations to order anything. The first scheme was sometimes the basis for odd discussions with clients on how much they still need to order and what kind of additional forced projects we could come up with to reach the limit. The second scheme always produced positive surprise followed by discussions whether we should transfer the money back or use it for additional projects our clients always wanted to do but couldn’t finance – „hidden delight“.

Why don’t You get money back from Amazon, if you paid for 48 hours of access time, but only needed 3 hours to watch the film?

I know the question sounds absurd, but it helps to look at pricing mechanisms from a different perspective, the perspective of trust building.

The two most common ways to reduce pricing without loosing margin are limitations (less Gigabytes, limited time, reduced features etc. than the consumer might want in future) and bundles (more months, more of the same, more Gigabytes etc. than the consumer might want in future). Both are continuously mentioned as reasons to feel disappointed and tricked – reasons to lose trust. Why is that and how can the „hidden delight“ pattern change it?

With limitation and bundles, Marketers sell less than the consumer might want in future or more than the consumer might want in future. What they most often don’t sell is what the consumer actually might want in the future.

Limitation and bundles force customers to make a bet. And every time the bet turns out to be a bad bet, the customer will transfer the disappointment onto the relationship.

Have you ever signed a one year fitness centre membership (more than you might want in the future) and „saved“ months of fees? Have you ever learned later on, that you actually joined the fitness program only for some months but still the payments were due month per month? It occurs to me, that the fitness centre industry only exists, due to the one year (or sometimes even two year) contract model. They know that the usual member will become a „sleeping“ member within months. It allows to intensively overbook the fitness centre and sell not 12 months for the price of 10, but 3 months for the price of 10.

Members who notice that they where somehow tricked – at least not advised to their benefit by the fitness centre agent – will not prolong the membership (well they actually wanted to leave earlier anyway 😉 or come back later. They also will not recommend the fitness centre in the neighborhood and might try to trick back. The consequence of limitation or bundle pricings are often frustration and distrust. No one will thank you for a benefit signed years ago but many will complain about a loss once happening. So the initial advantage in selling becomes a nightmare for selling again.

My wife was an extreme Adobe enthusiast for the last 15 years. Back in the days we had long disputes on whether „Illustrator“ (her favorite drawing software from Adobe) or „Freehand“ (the competitor from Macromedia I preferred) was the better choice. She insisted on the Adobe software and partly this preference seemed to originate from her deep trust in Adobe. This trust was broken some months ago, when Adobe granted her a 3 month free try out for a pool of stock images. She accepted („well it’s for free let’s see maybe it’s useful“) but never actually used the service and didn’t know, that she needed to unsubscribe it weeks before the trial period ended to prevent it to become an expensive one year contract („Adobe wouldn’t do that to me“). From that moment on she was reminded monthly – when the next 50 € were booked out of her bank account for a service she never uses – that she can’t trust Adobe any longer. 15 years of buying Adobe software equals a 5 digit amount of sales volume. Seems that Adobe is not aware of the return on investment in trust.

ING the biggest Digital Bank in Germany chose a different route in their mortgage division. Additionally to an extremely competitive interest rate, they offer a further 0,1% reduction, if the customer opens a free of charge current account at ING and uses it as the main bank account. Let’s say the customer signs a mortgage of 250.000,- € for 10 years – that makes the 0,1% reduction worth more than 2.000,- € for using a for free current account. Bianca de Bruijn-van der Gaag, lead of the „home tribe“ and therefore responsible for mortgages at ING explains: „I know 0,1% is a lot. But the current account allows us to stay in a deep high frequent relationship with that customer for years. It gives us the opportunity to prove, that we are the right bank for further banking related business. It pays off in the long run“

We are used, that Telcos force us to sign a 24 months „membership“, gas and electricity providers have special offers with a min. of 12 months „membership“, car leasing contracts often can’t be cancelled within the first 36 months, if you want to pay back your mortgage earlier than planned, you have to pay an „early payback fee“ to the bank and once you buy the yearly public transport subscription (12 months for the price of 10) it will be extremely hard to cancel it, let’s say because you move to another city. Bundles ensure that customers are forced to stay longterm – well at least for those 12 or 24 or 36 months.

Companies which care about trustful longterm relationships act differently. „hidden delight“ is one of their secret weapons. Take Transport for London. When they introduced the oyster card in 2003, they offered the opposite of the examples above. With Oystercard you pay the regular price of a standard ticket per travel but if you use it to an extend, that a day pass or week pass would have made more sense, they retrospectively switch you to the special day or week rate offer. „Travel as much as you like in one day and we’ll cap your fare so you don’t pay more“. Transport for London sells what the consumer might want in the future. Transport for London solves the cognitive inconvenience to predict one’s travel behavior – an uncertain bet – and offers a „hidden delight“ model. At the end of the day (or week – depending on the card) Oystercard users get a refund, if a cheaper ticket would have made more sense. A frequent positive surprise.

Definition Trust pattern #003 Hidden delight
The „hidden delight“ pattern describes behaviours in a relationship, in which one party changes conditions like pricing or service intensity retrospectively to the benefit of the other party.

„Hidden delights“ allow the continuous communication of good news along the way. And they help to sell. The Oyster card „cap your Fare“ offer was initially installed to make the Oyster Card attractive to customers. Longterm attraction in contrast to potential longterm frustration of bundles and limitations.

Now apply the „hidden delight“ pattern on your business.
What would happen if a bank doesn’t offer a special trading offer for the first 6 months, but reduces the trading fees depending on the length and intensity of the customer relationship. Wouldn’t this create positive longterm bonding? Wouldn’t it foster a trustful relationship? (And yes, if you do the math banks would make a good margin). Or Vodafone? What would happen with your trust towards Vodafone, if you don’t have to decide between plans because you know you always retrospectively get the plan which best suits your consumption? would it make you relaxed about telco plans? Would it make you stay longer with Vodafone?

PS.:
A friend of mine just recently experienced the Amazon example. She wanted to watch a film and bought a 48 hour rent at Amazon. Within the 48 hours she didn’t watch the whole film. So she would have needed to buy another 48h rent to watch the rest of the film. Does that feel fair? Well she contacted Amazon via chat and told her story. And „one minute later I could watch the rest of the film without double payment – it was a very positive surprise“. A customer care agent repaired the trust. The „hidden delight“ pattern creates trust systematically.

Also see
Trustpattern #001 „Put it on my tab“
Trustpattern #002 „adversely trigger“

Posted on by Ron Hofer

Trustpattern #002 „Adversely trigger“

Two days ago, Katharine Viner, the Editor-in-chief of the Guardian send me an email. She thanked me for supporting the Guardian and told me, that the next annual payment date is 15/03/2019 (a month ahead) when €49.00 will be charged to my credit / debit card.
She actually reminded me, that now would be the time to cancel my subscription.


Some weeks ago I received a similar mail from dropbox, telling me, that now would be the time to cancel my membership, as in 4 weeks time the next yearly membership fee would be due.


What is going on here? Are they all going nuts? Did some agents from the competition take over the marketing department? Who should earn the money they throw out the window? „Do you really want to renew your subscription ?

Well actually I didn’t unsubscribe dropbox nor the guardian. The emails fostered my feeling to be at the right place, to have chosen the right partner.

The “Adversely trigger” pattern makes you feel in interaction with an extremely integer and transparent partner. You experience a proud gesture of your partner being convinced of and focused on the overall service quality offered. The pattern makes you aware that you have a choice – and that your choice is right.

Take a minute and apply it to your business model.
What would happen if you tell your customer that switching their bank accounts has been made much easier with PSD 2, that there is a cheaper mobile phone plan offered at your company or that an insurance actually doesn’t make sense anymore just weeks before automatic subscription renewal

What would be the immediate loss?

What would be the difference if a service like Aboalarm reminds you instead?

What would be the longterm benefit?

Posted on by Ron Hofer

We need more flowers and less fish

Every time I join the International Management Summit of the SYZYGY AG at one of our locations, there is one very special and surprising moment which tells a lot about SYZYGY. When I check into my hotel room there is always a little present and a personal note waiting for me, written by my CEO, Lars Lehne. So far so good. The amazing thing about it is the kind of present.

Presents tell us a lot about the person giving the present and about the relationship he seeks. There are neutral presents such as the good old Chocolate, Soap, Wine, award winning book on Digital Transformation or my favorite: the empty but company branded notebook. And there are very personal presents. Books with an attitude, books which dare to polarize, books like the last two books Lars Lehne gave us as presents. Both of them reflect his belief system and both of them are dealing with what I call ‘trust patterns’ in collaboration.

The first book is „Give and Take“ from Adam Grant. 

Adam Grant is Wharton’s top-rated professor for seven years straight. He is a leading expert on how we can find motivation and meaning, and live more generous and creative lives. „Give and Take“ is a condensed summary on 20 years of studies on the long-term impact of a giving versus a taking attitude in relationships. Adam Grant and his team at Wharton University studied how those two attitudes influence long-term success in a variety of fields such as sports, law, medicine or business consultancy.

Guess who is on average more successful?
The one who always helps out, always has an open ear, helps you prepare for exams without expecting a direct benefit in return (the basis for trust patterns!)?
Or the one who takes advantage of those givers where ever they can?

 Yes – unfortunately no surprise there – the taker is generally more successful. 

BUT, Adam Grant found something very surprising in the details. Although Takers are on top of the success leader, followed by matchmakers and then givers at the bottom, the most excellent 2% on the very top of the whole scale, above all Takers, are also Givers. The book has a strong message: a giving attitude in relationships is the better long-term strategy for competitive advantage and excellence, but you need to apply it carefully not to burn out and be exploited – which makes you end up at the very bottom of the success scale.

The second book is „The art of possibility“ 

„The art of possibility“ is co-written by Rosamund Stone Zander, a family therapist applying her knowledge on corporate organizations, and her spouse, Benjamin Zander, the famous conductor of the Boston Philharmonic Orchestra. „The art of possibility“ describes how leadership can boost creativity and motivation in organizations. Just like in a famous orchestra.

In one chapter they share an insight they call „Giving an A“. „Giving an A“ describes how people who experience an unconditional retainer of trust in the beginning of a relationship (similar to trust patterns!) are on average much more productive, creative and motivated. It sounds so obvious but yet, how often do we experience just the opposite when we get to know somebody new – that feeling of being tested, that hesitation to grant trust which sometimes nearly feels like suspicion and distrust. It is reflected onto how we see ourselves. We start to distrust our own capabilities and creativity.  

I can highly recommended these two books – and with that said – working at SYZYGY with Lars as our CEO. There is this saying „a fish rots from the head down“, meaning, that the way upper hierarchy levels act and think have an enormous impact on how things are done in an organization. They overwrite any initiative of lower hierarchy levels.
In this case I would like to creatively change the saying into „a flower smells from the head down“ 😉 

We need more flowers and less fish.

Posted on by Ron Hofer

Trustpattern #001 “Put it on my tab”

Have you ever experienced that sudden frustration of queuing in a long line in the super-market and noticing that you had forgotten your money? Upset at your own forgetfulness, you think of the hassle you will have to go through such as returning all the items in your basket to their shelf (or hiding them somewhere…?), walking back home and up the stairs in a hurry, fetching your purse (or smartphone or cards) then returning to the supermarket after having to phone your friends to tell them you will be late You would then have to collect the items and queue all over again.

Now imagine that instead the cashier would say “Oh It’s okay. Just pay us next time you come in”. With a feeling of gratefulness and appreciation at this generosity, you would leave the supermarket with a relieved smile.

The concept of “Put it on my tab” is not a new one

The concept of “Put it on my tab” is not a new one and has been with us for some time. Many years ago, the “tab” consisted of a physical tablet or notebook where all these open payments were written down. When I went shopping with my Mum as small boy, this was generally based on the “Put it on my tab” pattern. The pharmacy, the fruit and vegetable shop, the butcher all simply made a note and billed the “family account” at the end of the month. There was no written contract and my Mum was so used to this system that she seldom took money with her – and she always returned to the same shops.

Doesn’t the same happen to us nowadays with many relationship-based business partnerships? We use the mobile phone and get billed later. We use electricity and pay at the end of the month. We use car2go and are billed after usage. Not to forget the invention of the credit card which is based on the same principle. The difference of these examples and the „put it on my tab“ pattern is, that they make you sign a contract to ensure you will pay the bill and your credibility is checked before you are allowed to have that business relationship. „We don’t trust you“ is their initial message.

In the “Put it on my tab” pattern, future payment is ASSUMED and the risk for the lender of not getting paid is accepted. This is an impressive sign of trust and one which encourages us to return as loyal partners. It also imparts a feeling of owing more than just the money you did not pay immediately. You owe loyalty and trust. The pharmacist probably experienced some incidents of fraud, but overall this policy paid off.

In e-commerce there is of course no one-on-one relationship to handle the risk involved in the “Put it on my tab” pattern and there is no pharmacist who knows you personally, but there is real-time data which makes it at least as easy to predict fraud and control the overall sum of losses involved in applying the pattern (more on this in future posts).

Have you ever applied the “Put it on my tab” with friends?

Presumably you have!

Have you ever considered applying the “Put it on my tab” pattern in your customer relationship?

Recently there was an amount of minus 3 Euros in my PayPal account and I was not permitted to use the PayPal payment service until I transferred these 3 Euro from my bank into my PayPal account. As I have been using PayPal for about 15 years, one can imagine how this affected my feeling of loyalty towards them. I was so upset, that I opened a Paydirect account instead – knowing that it would not be as great a product.

Imagine buying at Otto.de for years and one day at the online checkout your credit card seems to be invalid. How would it feel, if Otto.de would say, “No problem! We are sending the item. Please transfer the money until end of the month”

Posted on by Ron Hofer

Altruismus versus Egoismus – why we cooperate

This is a wonderful documentary in three parts on the “survival of the most altruistic”. Unfortunately only in German language …

Folge 1/3: Oder weshalb wir kooperieren

Folge 2/3: Oder was uns zu Egoisten macht

Folge 3/3: Oder wie wir die Welt verändern können

“Erst kommt das Fressen, dann die Moral”, stellte Bertolt Brecht so anklagend wie resignierend fest. Wer kennt das nicht: Den Sturmlauf aufs Buffet, wenn die Hühnerkeulen auszugehen drohen. Bislang bestand kaum Zweifel, dass der Mensch ein egoistischer Raffzahn ist. Die Finanzkrise scheint dieses Menschenbild gerade wohl zu bestätigen. An der Börse wird gezockt bis zum Abwinken, ohne Rücksicht auf Verluste. Die Verlierer campen auf der Straße und fordern Fairness und Solidarität. Gutmenschen vs. Egoisten? Arm gegen Reich? Macht gegen Moral?

Forschungsergebnisse aus den unterschiedlichsten wissenschaftlichen Disziplinen zeichnen in ihrem Zusammenwirken ein anderes Menschenbild: Der Mensch als soziales Wesen, das Werten wie Großzügigkeit und Gerechtigkeit den Vorzug vor schierem Eigennutz gibt. Doch wie passt dieses Bild in den Kontext unserer bestehenden gesellschaftlichen und wirtschaftlichen Strukturen? Ganz nah dran am Puls der Zeit erforschen wir Zusammenhänge, die auf den ersten Blick unfassbar scheinen. Wir werfen einen interdisziplinären Blick auf die Befunde, die das “Gute” im Menschen beweisen sollen und fragen nach dem Sinn altruistischen Verhaltens im Kampf ums Überleben. Wir nehmen den Zuschauer mit auf sein ganz persönliches Abenteuer, an dessen Ende er sich selber fragt, wie viel Altruismus wohl in ihm steckt.

Posted on by Ron Hofer

The business rationale in Trust patterns

„Yes, you didn’t order it but it is very good!“

The Milanese Cheese seller smiled at me from behind his cheese stand and didn’t really understand, why i wasn’t amused about the extra „Fior di Latte“ he snuck into my cheese selection. Fior di Latte is a wonderful cheese, similar to Mozzarella, but much creamier inside. I love Fior di Latte. But I also love to decide for myself, if I want to buy it, especially when it doubles the amount I have to pay.

The „Sneak into basket“ trick he applied is one of the so called „dark patterns“ used in eCommerce nowadays. Dark patterns range from „Hidden Costs“ to „Price Comparison Prevention“. All these tricks have in common, that they generate an unfair advantage in a business relationship. One could say dark patterns are the saving belt for Product Managers and Marketeers with over ambitious short-term sales goals. I guess with this simple trick the cheese seller sold quite a bit of Fior di Latte to new customers.

What he didn’t know was that I lived just around the corner for another 4 years and yes ever since then I quit my „business relationship“ with him and bought my cheese at the market stand right next to him. Business relationships evolve quite similar human relationships. Our relationships are not re-evaluated from scratch everyday. It is to a very high extent set at the initial moments of interaction (the introduction phase) and re-evaluated in moments of conflicts with the preset expectations. Black patterns, especially applied at the beginning of a relationship, define it to be based on distrust and low engagement.

The future of business is based on longterm relationships

We are in the business era of „everything as a service“ – meaning next to everything we used to buy is now available as a digitalized pay-per-use equivalent. And if it isn’t yet it will be tomorrow. Angela Merkel, the German chancellor, just recently predicted, that “everything which can be digitalized will be digitalized in the near future”. EaaS comes with an unbeatable set of competitive advantages in comparison to leasing or selling based business models. But they have one weak spot: EaaS based businesses derive little earnings or even losses in the beginning of the customer relationship. Every new customer produces initial onboarding efforts and running costs increasing the payout time for these relationship based businesses up to years. And usually these business models not only make the purchase decision much easier, but also the decision to switch the service partner (sell your car and buy a new one versus changing from car2go to drivenow). Robbie Kellman Baxter discusses the underlying opportunities and challenges of this business model in detail in her book „Membership Economy“.

The key success factor of EaaS business cases to break even are engaged customers.

It’s the level of engagement (activation, recommendation and retention) of their customers which makes EaaS profitable and this engagement is highly dependent on the quality of the relationship companies have with their members.

Just recently at the digital agency USEEDS°, we calculated the business opportunities in a fully digitalized wealth management service based on a „pay-per-use“ purchase model. For the customer this service is a highly attractive alternative to classical consulting fee based models. But for the bank the beauty of a scalable fully digital system only flourishes, if tens of thousands of customers actively use the service for years to reach the Return on Investment. The core lever of successful relationship businesses is the long-term loyalty and engagement of customers. There is no place for dark patterns in this business model.

We need patterns to boost long-term relationships

The success of relationship based business models is highly dependent on the quality of relationship they set in the introductory stage. All follow-up attempts to influence the relationship with Customer Loyalty or Customer Engagement programs are less efficient and effective. We analyzed 300 companies in their approach to set a positive relationship at the moments of truth (moments of introduction, trouble or expectation conflicts) and discovered a set of patterns which could be applied to any business. (we will present and discuss the patterns in future articles at trustpatterns.org )

The longterm business advantage in Trust patterns

Patterns trading an initial disadvantage for the company for long term Customer Loyalty and Engagement are the opposite of dark patterns – so we call these patterns Trust patterns. Trust patterns create an initial „unfair advantage“ for the customer (the reacting partner) not the company (the acting partner). Trust patterns foster the quality of relationship towards that feeling of loyalty and trust – a feeling of belonging. They are not magic. nor manipulative. Trust patterns suggest an initial investment to set positive, long-lasting relationships, in which the investment generates returns in time.

We are not talking business romantics here

Without a solid business case next to a great purpose vision and attitude, any endeavor is damned to vanish. Trust patterns in business are an extremely valuable building block in membership business which only derives the expected long-term revenue streams and return on investments, if you clients a held in a positive AND active relationship. And membership business is a mega trend around industries. According to a 2018 study* with 1200 teenagers in Germany (12 – 19 years old) , the amount of netflix users doubled within one year to 47% market penetration. Spotify grew by 28% from Q3 2017 to Q3 2018 toward 190 Million users worldwide. The ownership model will still be around, but undeniably, membership business and the „everything as a service“ mantra in digitalization are the new business paradigm.

Trust patterns define the necessary sustainable and profitable ways to make long-term business success happen AND spread the idea of trustworthy and fair relationships in our society.

*by 2018 JIM-Studie 2018 des Medienpädagogischen Forschungsverbunds Südwest

Posted on by Ron Hofer

The power of Trust Patterns

Our dream about this blog is, that the ideas behind Trust Patterns will spread and many of you see the potential in trustworthy, long-term relationships, no matter if with foreign countries, your customers, clients, colleagues, neighbors, spouse or kids. The format of patterns seems to be ideal to help you easily experiment with and adopt the ideas and mechanics behind the Trust Patterns we identified in our research. I could write a whole different book about the power and beauty of patterns as a format to capture experience. Patterns are containers filled with ready to use best practice, they can set new norms, they are vivid sources of inspiration for innovation and they can help to predict future behavior in unknown set ups.

When we design something, no matter if physical, digital, processes or organizations, laws or regulations, brands or relationships, we have to consider many interdependent factors and make lots of decisions in an interrelated landscape of problems and solutions. Patterns help to make these decisions based on best practice sample. If the pattern has worked well for many previous design projects, there is reason to believe, that even if we don’t completely understand the problem or the mechanics behind a pattern thoroughly, we will derive a good solution. Patterns are mechanics you could plug and play in your solution.

Patterns make best practices accessible

I am half Bavarian and as such I have a copy of the famous „Bavarian Cook Book“. The structure of this 1.6 million copy bestseller was written by a Bavarian teacher, Maria Hofmann, back in the 1930s and is still seen as the cooking bible in Germany. It is based on the idea of patterns, in this case cooking patterns. There are about 100 basic recipes (cooking patterns) which are described in depth (e.g. how to make yeast dough) and about 1700 recipes based on those patterns (in this case dumplings, bread, Pizza, cakes, etc.). Patterns are best practice building blocks ready for reuse. They offer a condensed description of a proven mechanism or interdependency between multiple factors, which can be adopted for individual context related use.

Take another example, the „radio button“ pattern in the Interaction Design pattern library. It is a best practice mechanic connecting expertise in Screen design, Interaction Architecture, Usability, Legal and Coding practice. It can be applied in any kind of interface in which a user should select one of more than two options, such as in voting in elections, choosing a color for an item to purchase, selecting the right frequency for a SOS call at sea or selecting the media source on your in car TV. Using the pattern guarantees efficient coding, including all states and rules, that people understand it’s meaning and usage and that the way to offer options is legally save and according to quality standards such as the German TÜV. All in one building block – ready to be reused again and again.

For the same reason In Computer Science, patterns became very popular as they can be reused, making coding much more efficient. „Design patterns“ gained popularity in Computer Science. Design patterns can speed up the development process by providing tested, proven development paradigms which consider issues that may not become visible until later in the implementation. Patterns help to build on the experience of others. They are a powerful way to capture and share knowledge.

Patterns inspire
(Pattern based innovation)

Patterns can be used to re-invent systems in ways unusual in traditional design thinking processes. A paradigm in Design Thinking is, that we should always start with understanding the problem in it’s depth and then get creative in problem solving. Problems are usually documented in „How might we…?“ question, which set the focus for finding solutions. But in real life, there is another process to find innovative solutions, contrary to this approach. I bet it also happened to you once. You see a great solution for a problem, for instance how airplanes used Anti-blocking systems to allow a safer landing – and apply it to another context, let’s say cars. Often a great solution in one context is the inspiration to improve in another context. You didn’t start with the problem, but with a great solution for a problem. Eric von Hippel is one of the forerunners of this kind of innovation. Back in 2016 he established the idea of „Lead Users“ to innovate. His idea was to identify solutions from similar contexts and apply them to yours. Jed Laskowitz, CEO of the JP Morgan Case investment unit for instance was so impressed by the Netflix membership model, that he risked a multi-million earning stream and asked his organization to find ways to apply that model (the solution) to brokerage services of JP Morgan Case. It resulted in a „trading for free“ membership even though the bank had previously charged $24.95 for each online trade. Patterns help to trigger these „What if …?“ based innovations in a structured way.

There are many Pattern collections available made to inspire „New to the world“ innovations. All of them are generated by analyzing systems, clustering them in sub sets with similar cause and effect pairings and describing them in a rather abstract way, ready to be applied by and transferred to other contexts. A great example of those kinds of pattern collections are the Business Modell Innovation Patterns. In 2011, Prof. Oliver Gassmann and his team started the CTI project Business Model Innovation at the University of St. Gallen. The goal was to develop a methodology for business model innovation for incumbent firms. The analysis of more than 250 case studies culminated in the book “The Business Model Navigator,” written by Gassman, Frankenberger & Csik in 2014. It contains 55 Business Models which reappear throughout diverse industries and help to identify totally new ways to set up your business model. (https://bmilab.com/book)
For instance, the razor and blade model, in which one thing is sold for a very competitive price (razor) to make customers frequently buy the other thing (blades). We can see the same pattern for printers and cartridges, … – now apply this pattern to your business. What could be the razor, what could be the blades?
Or coming back to the Bavarian Cook Book: what if I apply the „how to smoke a fish“ pattern and apply it to vegetables?

Patterns predict

Patterns are predictions. They connect a cause with the most likely effect, which makes them extremely powerful means used for decision making. „Pattern recognition“ the active search for these cause and effect pairings is crucial in all aspects of our life. If there is a dog growling at you without leash, you predict a certain intention and act. If a customer bought twice at your shop, there is a high probability that he might become a long-term customer, if the client asks for a second meeting to discuss details of a project, there is a high probability, that he wants to work with you. Patterns are everywhere. In Psychology pattern recognition describes a cognitive process that matches information from a stimulus with information retrieved from memory. Quite the same happens in predictive analytics. Data is retrieved from diverse sensors and Data sources and then matched with expected intentions. Those expected intentions can then trigger behavior. An early example of this is learning to count. When parents repeat „1, 2, 3“ multiple times to a child, utilizing the pattern recognition, the child says „3“ after he/she hears „1, 2, „ in order. In predictive analytics the same would happen. The pairing of the Data retrieved (sequence of 1 and 2) with the expected intent (3) would lead to the output „4“ (just kidding ;). These patterns are extremely powerful, as they allow us to artificially predict intentions and trigger behavior in complex situations. For instance, pattern recognition can help to predict the “customer lifetime value” (CLV) of a customer. The CLV is a common metric used in Marketing to predict how valuable a specific customer will be in the overall future relationship, which could be years ahead. The CLV is based on a complex, interrelating set of data like how much money a customer spends, the number of returns they make, their ZIP code, transaction records, website interactions, customer-service conversations, social-media profiles, marital status or age. Via pattern recognition, the data of a single customer is connected with a most likely (future) intention and in case of a predicted CLV above average, it is the basis for customer tailored actions, such as special offers or faster reaction times. This is basically just a digital version of what store owners have been doing since the beginning of time — judging a person’s worth based on how the person looks like or how the person behaves.

Another example for prediction by patterns are the „High Value Activities“ Amazon and other eCommerce companies use to influence future behavior of their customers. Through pattern recognition, they find specific activities (other than purchasing an item or service) that in itself have no value to the company, but increase the probability of a future behavior with positive impact for the company. For instance a pattern such as „customers who at least once watch an Amazon Prime film within the for free trial period have a much higher chance of becoming paying Prime members“ can result in innovative Marketing activities to influence customer behavior (watch a film at least once).

Patterns can become norms

Have you ever seen a person holding a hand between the closing metal doors of an elevator? Have you ever experienced a kid touching the TV Screen to switch programs? Have you ever bought online in the assumption, that you can send back the item for free, if it doesn’t please you? Patterns, if they are applied often and accepted well, can define new expected conformities, norms, expectations and behavior.
With the Nobel Prize winners in Economic Sciences, Daniel Kahneman and Richard H. Thaler, we saw a rise in data-driven behavioral economics – unfortunately most often applied to so-called “dark patterns”, which make customers act to the benefit of companies. Or should I say “short-term benefit”, as those customers will try to leave or trick back in the long term.

For deep relationships, we need the opposite – “Trust Patterns” – in which all parties experience a “retainer” of benefits, trust and value which makes them loyal, long-term partners.

Trust Patterns can make this world – little by little – a better place

Trust Patterns will make best practice samples accessible and adoptable for all of us, Trust Patterns will inspire and motivate us to use trust based long-term relationships as a reciprocal advantage, Trust Patterns will help to integrate reciprocal altruism into data driven systems and last but not least, more and more Trust Patterns might become norms in society. We believe that using patterns as the form to document the best practices samples we found will motivate many of you, to apply more Trust Patterns in relationships and thus make this world little by little a better place.

Posted on by Ron Hofer

Trust Patterns

I was extremely excited. Our phone rang and I saw it was the client we were trying to convince to work with us. Back in the year 2009 we just recently founded our Digital Consultancy and every new client was crucial. „Hi Mr. Hofer, we finished our internal discussions and decided to work with you on the project“ – my heart beated faster and a smile rose up my face – „but …“ – „yeah we can review the budget maybe there is a way to reduce our costs“ I interrupted him eager to get the project – „no, actually we would like you to double check if you considered all aspects of the work. Your proposed process is perfect, but way too underpriced. To do the job you need at least double the proposed budget“.

Why did they act like that? Isn’t it a company’s goal to get what is needed in a suitable quality for the lowest price? I was puzzled by their reaction. Looking back now ten years later, this client is still the biggest asset in our company. We developed a strong relationship and made them the benchmark in the German digital banking industry. And they helped us grow from 5 Digital enthusiasts into a 50 people company. 

What happened back then was a trigger to set up a strong relationship based on mutual trust. You can imagine that we tried when ever we could to overperform, to show them that the trust they invested in us was worth it. And amazingly, that relationship scaled from me and the responsible person at the bank to a relationship within a growing team on both sides. A valuable culture evolved bringing longterm success for both parties. 

In this blog we Deep dive into all aspects of this beautiful kind of relationship and discuss the underlying patterns to nourish them.

We call these patterns Trust Patterns.

Trust Patterns can be found and applied in any relationship – private, business, tribes or nations. Trust patterns have the power to evolve, to spread into broader groups of people. Trust patterns have the power to make this world a better place, to allow humans to let go of a „me first“ thinking without just being a naive altruist. There is business logic behind trust patterns and of course there are conditions necessary to nourish that kind of Trust Pattern relationship.

Let us take you onto a journey to identify amazing examples of Trust Patterns found all around us – in behavioral science, in nature, in politics, in professional negotiation, in religions, in business and learn how we could implement a trust pattern based culture into our relationships.

Relationships like the one between the pilot fish and the shark. Sharks love to eat fish, yet they let the pilot fish swim inside and outside of his mouth and even defend those little pilot fishes. Why don’t they just let the pilot fish do his job and finish the tooth manicure by a yummy desert? Why didn’t our client let us do the job for the extremely underestimated budget and switch to the next consultancy afterwards?

Trust Patterns create extremely valuable relationships, a competitive advantage which cannot be beaten easily.

And Trust Patterns have the power to foster success in a friendly respectful environment, an environment worth living in for the long run


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