Chapter 5: The First Customers You Must Earn Are Your Employees
Before a single customer decides whether to trust your brand, your employees have already voted on it.
They vote through the energy they bring to customer interactions, through the quality of decisions they make when no one is watching, through whether they tell the truth in rooms where the truth is uncomfortable. The energy inside your organization is the energy your customers feel in every touchpoint.
Chapter 5 of Build Trust. Become the Brand. makes the case that your employees are your first market, and that the brand you build with them determines the brand your customers experience.
Uber: The Cost of Ignoring Employee Signals
In February 2017, a blog post by former Uber engineer Susan Fowler exposed a pattern of harassment and discrimination that had been visible inside the organization long before it became public. [1] What followed was not a sudden crisis; it was the surfacing of internal signals that had been dismissed for years.
More than 20 employees were fired following internal investigations. [2] Over a dozen senior executives resigned or were forced out, including the CEO. [3] A SoftBank-led deal valued Uber at $48 billion, down from its earlier $68 billion valuation, a loss of $20 billion in private value. [4]
The signals had been present throughout. Meetings had a managed rather than an alive quality. Good people were leaving. The gap between the company’s stated culture and its actual culture was widening. None of it was acted on while correction was still cheap.
Costco: What Protecting Employee Signals Builds
Costco made the opposite choice consistently. They treated the internal signal, the energy of employees who genuinely believed in what they were building, as the most important competitive asset they had.
Membership renewal rates reached 93 percent in the U.S. and Canada and 90 percent worldwide. [5] Net sales approached $250 billion. [6] Employee turnover held at approximately 8 percent against a retail industry average near 60 percent. [7]
The trust customers feel in every Costco interaction is not manufactured. It is the direct output of an organization that protected its internal signal at every stage of growth.
The Key Takeaway
Your employees are not separate from your brand. They are your brand, the primary signal your customers receive before any marketing reaches them.
As Sunil Godse writes: “The room tells you the truth. The question is whether you’re willing to hear it.”
Case studies featured: Uber ($20B in value lost when employee signals were ignored [1][2][3][4]), Costco (93% renewal rate and $250B revenue built on employee trust [5][6][7]).
→ Deep dive: Relational Intuition – Why the Room Knows Before Your Metrics Do → Related: Step 3: Intuitive Hiring – Protecting the Room Where Trust Is Built → Read the book: Build Trust. Become the Brand.
References
- TechCrunch. Former Uber engineer says company ignored repeated reports of sexual harassment. https://techcrunch.com/2017/02/19/former-uber-engineer-says-company-ignored-repeated-reports-of-harassment
- Vanity Fair. Mass Firings at Uber as Sexual Harassment Scandal Grows. https://www.vanityfair.com/news/2017/06/uber-fires-20-employees-harassment-investigation
- Bloomberg. Uber’s Top Ranks Thin Out as CEO Travis Kalanick Steps Away. https://www.bloomberg.com/graphics/2017-uber-leadership-gap
- Observer. SoftBank to Buy a Chunk of Uber for 30% Off in Mega Deal. https://observer.com/2017/12/softbank-to-buy-a-chunk-of-uber-for-30-off-in-mega-deal
- Costco Wholesale Corporation. 2024 Annual Report. https://s201.q4cdn.com/287523651/files/doc_financials/2024/ar/COST-2024-Annual-Report.pdf
- Costco Wholesale Corporation. Fourth Quarter and Fiscal Year 2024 Operating Results. https://s201.q4cdn.com/287523651/files/doc_news/Costco-Wholesale-Corporation-Reports-Fourth-Quarter-and-Fiscal-Year-2024-Operating-Results-2024.pdf
- Harvard Business School. Costco and other retailers prove a ‘good jobs’ strategy works. https://www.hbs.edu/bigs/costco-and-other-retailers-prove-a-good-jobs-strategy-works