19 February 2009
There’s been a lot of debate among ship-owners and managers recently on various maritime-oriented groups on LinkedIn (click here to join the ShipServ Group, by the way) about the long-term future of e-commerce for the shipping industry.
Much of that debate seems to centre on how to build trust online. Many ship-owners think that building trust with suppliers that you only ever interact with over the Internet is problematic to say the least.
For many good historical reasons, the shipping industry is one where person-to-person contacts, generally via the phone and built up over many years, are the lubricants of commerce. As a result, wherever shipping people meet, you still hear some of them baldly stating that e-commerce will never take-off (see a recent ShipServ blog on this subject). These people intuitively believe that familiarity is a pre-requisite of trust and that familiarity can only stem from face-to-face contact.
It’s true that the traditional way trust is developed is through real human interaction – but this has clearly already been sharply altered by new technology. We all – or at least most of us – trust online commerce a lot in our personal lives. Very few of us worry about Amazon, iTunes or eBay ripping us off. And this despite all the publicity about the reality of online fraud. These companies, and many, many others seem to have won their consumers’ complete trust.
The same thing is beginning to happen in maritime commerce. While human relations will never be squeezed out of the shipping industry, it’s worth saying at the outset that many aspects of our business don’t need human intervention at all.
While contract negotiation will always involve human discourse, there are many other aspects of our business that actually benefit from a lack of human contact, things like receiving orders or sending out quotes. You could argue strongly that e-commerce systems create more trust because they exclude humans from the process: they reduce the errors that come from having to endlessly re-key documents; they always have an audit trail prevents deniability. When there’s a cast-iron electronic record, it’s hard for your customer to say that he didn’t receive that fax.
Going beyond the simple, straightforward benefits of e-commerce, what else can we say? Let’s look at TradeRank, introduced on ShipServ Pages in 2008 to indicate a supplier’s popularity in the market.
Based upon your activity on ShipServ TradeNet – TradeRank is a blue ‘gauge’ icon appears next to your profile on Pages. The more blue in the gauge, the more popular you are. Of course, your popularity means nothing to a prospective customer if you don’t match what they’re searching for, but if you have supplied, say, crane parts successfully to another shipping company just like theirs in Dubai and the transaction was successful, that’s information that’s worth sharing and promoting. And it’s one more small step towards building trust online.
(By the way, lack of or a low TradeRank should never be seen as a negative evaluation of your ability to deliver the desired product, nor should it discourage a buyer to trade with you. The absence of a TradeRank merely suggests that you’re not widely used at the moment within the TradeNet buyer community.)
In ways like this, TradeNet is actively building a digital fingerprint of global maritime activity that is already being used positively by the ShipServ community to inform buying decisions. Surely it is really useful for you to share with a brand new customer that you have already been used by a trusted community such as the TradeNet buyers? Or that you have a track record of fulfilling orders, not just saying you can supply?
The exciting part comes when you think about the potential of online social networks. Yes, the likes of Facebook are probably not the future of maritime ecommerce, but LinkedIn Groups mentioned previously are seeing intense flurries of commenting on issues, requests for recommendations and answers to questions.
Going forward, it’s not hard to envisage the emergence of a new breed of tools that take inspiration from Facebook, myspace etc. and built around maritime commerce interests and challenges. Imagine building your own network of trusted customers, getting their recommendations on your profile – just as people give their friends minute-to-minute status updates on Facebook.
Just like in the real world, trust online stems ultimately from the way you behave: good interactions lead to more and better interactions in future. Bad personal interactions will always wipe away a company’s reputation. The only problem is that online this happens faster and more people get to hear about it.
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