As Internet marketers, we learn all about reducing stress and anxiety in the user experience. We put “VeriSign Trusted” certificates on our websites. We us HTTPS and put tiny lock icons all over the place to assure our visitors that their information is safe.
This isn’t a new concept. Businesses have always known that reassuring their customers and earning their trust is a critical component of the sales process.
Trust is why we our parents felt reassured when they saw the “Good Housekeeping Seal of Approval” on products from spray starch and dishwasher detergent to cake mixes and cereal. And trust is why we all feel a little more comfortable when we see that a company has been accredited by the Better Business Bureau.
But are we right to trust The Better Business Bureau? What exactly do their ratings mean, and how does a company get rated?
According to their own website…
BBB has determined that COMPANY NAME meets BBB accreditation standards, which include a commitment to make a good faith effort to resolve any consumer complaints. BBB Accredited Businesses pay a fee for accreditation review/monitoring and for support of BBB services to the public.
BBB accreditation does not mean that the business’ products or services have been evaluated or endorsed by BBB, or that BBB has made a determination as to the business’ product quality or competency in performing services.
And from their explanation about grading:
BBB letter grades represent the BBB’s opinion of the business. The BBB grade is based on BBB file information about the business. In some cases, a business’ grade may be lowered if the BBB does not have sufficient information about the business despite BBB requests for that information from the business.
BBB assigns letter grades from A+ (highest) to F (lowest). In some cases, BBB will not grade the business (indicated by an NR, or “No Rating”) for reasons that include insufficient information about a business or ongoing review/update of the business’ file.
BBB Business Reviews generally explain the most significant factors that raised or lowered a business’ grade.
BBB grades are not a guarantee of a business’ reliability or performance, and BBB recommends that consumers consider a business’ grade in addition to all other available information about the business.
So, according to the Better Business Bureau itself, “BBB grades are not a guarantee of a business’ reliability or performance” and BBB accreditation “does not mean that the business’ products or services have been evaluated or endorsed by BBB.”
So why should we care about a BBB rating? What is the actual value of being accredited by the Better Business Bureau?
Back in November 2010, ABC news reported on a scandal at the Los Angeles BBB, where a group of business owners accused the BBB of “running a “pay for play” scheme in which A+ ratings are awarded to those who pay membership fees, and F ratings used to punish those who don’t.” To prove the point, they paid $425 to the LA BBB and obtained an A- rating for a fictitious company they created called Hamas, named after the Middle Eastern terror group. The ABC News investigators even went to the organization with 2 small business owners and were told their grades of C could be raised to A+ if they paid $395 membership fees.
Of course, you can’t find the BBB rating of Hamas anymore. And the BBB investigated the LA BBB for violations and actions they claimed did not follow their policies. On Dec. 22, ABC News reported that William Mitchell, the CEO of the LA Chapter of the BBB resigned amid that ongoing investigation by the national headquarters.
But if you think that the questionable ratings ended there, you would be sorely mistaken. Here are some other companies and their ratings as of 2/18/12:
- Monsanto A+ (2 complaints closed within the last 3 years)
- BP America, Inc. A+ (16 complaints closed in last 3 years, BBB knows of no significant government actions involving BP America, Inc.)
- Charter Communications Inc. A+ (5527 complaints closed in last 3 years, 1488 closed in last 12 months)
- Citi A- (6383 complaints closed in last 3 years, 2,539 in last 12 months, multiple government actions)
In case you don’t know who Charter Communications is, they were Business Insider’s Worst Company in America 2010. Monsanto is widely considered to be one of the worst environmental criminals in the US, and was the company upon which George Clooney’s movie, Michael Clayton, was based. Citigroup is, well, Citigroup, and just agreed to pay the U.S. $158 Million to settle mortgage fraud claims, which is in addition to the $1.8 Billion Citigroup has to pay the Justice Dept. as part of the $25 Billion mortgage loan settlement from the nations top lenders.
But for me, the real kicker is BP America’s A+ rating, with only 16 complaints in the last 3 years. 16 complaints? No significant government actions? For those of us with short memories, the Deepwater Horizon exploded and sank on April 20, 2010, triggering the worst oil spill in history. Since then, the Justice Dept. has investigated the spill, as has the U.S. House Committee on Energy and Commerce, and President Obama issued an Executive Order establishing a bipartisan National Commission on the BP Deepwater Horizon Oil Spill and Offshore Drilling. No significant government action indeed.
Just to summarize: you can claim to be an organization that blows up buses full of innocent women and children and get an A+ rating from the BBB. You can engage in fraudulent business practices to the point that the U.S. government fines you nearly $2 Billion dollars and you can get an A- rating from the BBB. And you can poison the Gulf of Mexico, destroying the ecosystem and eviscerating the fishing and tourism industries of Louisiana, Mississippi, Alabama and Florida and get an A+ rating from the BBB.
Can someone please explain to me why anybody should ever trust a BBB rating?