In US car salesmen are amongst the least trusted professionals. On digging deeper one finds that they share these low rankings with advertising professionals, stockbrokers, insurance salesmen and surprisingly politicans too (Members of Congress, Senators and Governors). Have a look at the Gallup report summary below:
While there must be multiple reasons for people to trust certain professions and mis-trust few others, I am sure that the commission structure in a specific industry does lead to a low levels of trust.
My guess is that if consumers know that the middleman involved in the transaction could be motivated by goals that clash with theirs, they try and look at each conversation from the point of no trust.
Take for example, an online advertising agency which typically charges you 15% of what you spend on ad-networks. I remember, doing a detailed review with my agency and discovering that they were far away from optimization basis the Click-thrus and bid-rates. My first reaction was that this team is knowingly trying to jack-up the media spends and hence their cuts. It was some 3 hours later that I realized that they were not competent enough to make sense of the numbers and reports that the ad networks shared. Their intentions were ok !
Cars, stocks and insurance policies are all complex products with multiple features and specifications. This means that there is no single correct recommendation for any given customer.
When the customer seeks the agent to play an advisory role (whether implicitly or explicitly) and the agent himself is paid the sales commissions, the mind starts playing scenarios. And in most of these scenarios, agent has either shortchanged or duped the customer.
Look at the top spectrum of Gallup’s survey results. Doctors, Nurses, Engineers are all selling a service rather than a product. A doctor might give us any medicine but we feel its our symptoms/ailment that got cured. Doctor is not in the business of selling medicines but of curing.
And here’s an opportunity for the Financial Services industry – can we find a way to be percieved as selling services rather than pushing products and eating commissions.