1. Quotations
from
Valuing
Your
Customers
by
Angus
Jenkinson,
McGraw
Hill,
1995.
This
selection
from
his
classic
book
highlights
thinking
related
to
the
new
digital
marketing,
service
and
customer
experience,
and
customer
loyalty
in
the
era
of
individuality.
The
ideas
and
cases
in
this
book
explain
how:
– quality
must
evolve
from
product
quality,
to
process
quality
to
relationship
quality
to
meet
the
needs
of
today’s
consumers
and
employees,
and
to
achieve
optimum
potential
(returning
over
the
route
in
implementation);
– lifetime
value
becomes
the
key
to
both
long-­‐
and
short-­‐term
profitability;
– strategic
application
of
knowledge
and
of
communications
changes
products,
transforming
them
into
personalized
and
commodity-­‐proof
service
brands;
– shifting
from
‘brand
management’
to
‘account
stewardship’
preserves
and
nurtures
the
brand;
– ‘moments
of
truth’
crystalize
service
experience,
organization
development
and
relationship
management
in
the
‘archetypal
moments’
that
make
customers
come
back
–
and
tell
their
friends;
– guarantee
management
thinking
builds
an
end
to
end
business
devoted
to
acquiring
and
sustaining
valued
relationships;
Throughout,
the
word
‘consumer’
or
‘customer’
means
a
private
individual,
an
individual
within
a
company
or
a
company
quite
interchangeably
according
to
context
or
need.
Where
a
distinction
needs
to
be
highlighted,
it
usually
is
[people
are
people
wherever
they
are
and
they
all
have
ideas,
emotions,
desires].
These
are
disciplines
to
transform
organization
and
customer
value
by
creating,
sustaining
and
developing
relationships
of
value.
The
evolution
of
quality
from
product
performance
to
relationship
performance
is
the
critical
step
because
this
meets
the
new
aspirations
of
customers
and
employees...
•
If
the
transformation
is
successfully
implemented,
the
result
will
sweep
the
old,
impersonal,
antagonistic
mass
marketing
out
as
a
learning
phase.
If
not,
companies
will
count
the
cost
in
declining
margins.
•

2. Tomorrow’s
marketers
will
need
to
build
competences
which
move
marketing
from
an
impersonal,
transaction
focus
powered
by
image
to
a
personal,
relationship
focus
built
on
substantial
service
in
aid
of
the
brand,
not
just
one
to
one,
but
I
to
I
(I∞I),
using
and
mobilizing
all
the
responsive
company’s
resources
in
the
promise,
the
guarantee
of
quality,
delivered
at
the
moment
of
truth
to
a
recognized
individual.
•
[Marketing
in
the
digital
era]
is
the
means
of
transforming
the
impersonal,
unvalued
noise
of
the
modern
marketplace
into
welcomed
moments
of
truth
[touch
points],
which
become
the
basis
for
the
cultivation
of
a
reciprocal
relationship
between
the
individual
members
of
the
customer
community
and
the
responsive
company.
•
The
information
system
is
the
enabler
of
best
practice.
Until
a
company
has
developed
effective
knowledge
about
the
interaction
of
customers
and
company
at
the
front
line,
and
how
communications,
operations
and
activities
affect
customer
attitudes
and
behaviour,
it
has
little
opportunity
to
optimize
those
encounters
(Figure
1.2).
Until
it
knows
who
its
individual
customers
are
and
how
they
are
behaving,
it
will
find
it
difficult
to
break
out
of
an
impersonal
and
undifferentiated
treatment
of
them.
•
The
community
building
concept
is
central
to
quality
[database]
marketing.
Building
loyal
relationships
with
personal
customers
means
building
community.
•
Becoming
community
value
directed
increasingly
means
developing
a
mutuality
of
value:
loyalty
to
customers
creates
loyalty
from
customers.
Treasuring
our
reputation
within
the
customer
community
is
the
first
step
towards
creating
the
value
stream
that
sustains
the
company
into
the
future...
•
Service
mastery
is
then
the
blue
riband
goal.
It
is
achieved
when
organizational
and
relationship
effectiveness
come
together
in
product,
process,
information,
goals
and
mutual
loyalty:
the
needs
of
community
and
responsive
company
become
increasingly
self-­‐supporting.
•
This
model
of
organization
development
benefits
from
giving
direction
to
quality
development
goals;
and
by
ensuring
that
they
match
our
individual
needs
as
managers,
leaders,
employees
and
customers,
it
increases
the
possibility
of
achievement,
or
at
least
positive
movement.
It
replaces
the
goal
of
quality
as

3. product
specification
with
quality
as
customer
partnership.
Perhaps
the
first
toolmakers
said,
‘You
hunt,
you’re
good
at
it;
I’ll
make
your
flints’,
but
the
reality
is
that
no
product
finds
its
way
to
the
customer
without
an
uncommon
amount
of
cooperative
activity.
This
is
what
really
drives
economic
development.
•
On
co-­‐creation:
Let
us
first
say
something
about
‘competitive
advantage’.
Until
the
eighteenth
century,
‘competitive’
only
had
the
sense
of
‘competence’.
In
fact,
it
meant
‘working
together
to
achieve
excellence’.
This
is
the
basis
of
true
competitive
advantage.
•
For
decades,
organizations
acted
single-­‐mindedly
to
develop
the
skills
and
strategies
in
brand
building
and
communication
which
persuaded
customers
to
buy
the
products
the
company
wanted
to
sell.
The
skills
were
valuable,
but
their
deployment
was
one
way,
single
track,
outbound,
monolithic
communication
to
the
masses.
This
process
shaped
planning,
product
development,
manufacturing,
sales
and
marketing.
It
belonged
to
an
era
when
mass
manufacturing,
mass
distribution
and
mass
marketing
conditioned
the
industrial
paradigm
and
was
structure
focused
on
optimizing
the
length
of
production
runs,
not
customer
relationships.
Size
equalled
economy
of
scale
and
power.
Companies
relished
power
as
the
capacity
to
dominate
the
marketplace.
The
jobs
of
sales,
marketing
and
advertising
were
simply
to
shift
the
tin
the
factories
turned
out.
•
The
mass-­‐marketing
method
is
essentially
adversarial:
it
aims
to
dominate
markets,
customers,
tastes
and
styles.
Campaigns,
strategies
and
targets
shape
the
contest,
and
the
contest
is
often
with
the
customer.
•
Pushing
a
stone
uphill
is
hard
work.
So
is
paddling
a
canoe
against
the
river.
If
the
aim
of
marketing
is
to
make
products
sell
themselves,
doing
that
needs
a
profound
form
of
conversation:
profound
listening,
followed
by
profound
internal
action
to
digest
the
message,
then
profound
communication.
•
The
great
unifying
theme
of
the
20th
century
is
the
triumph
of
the
individual...
•
Marshall
McLuhan
made
the
following
prediction:
‘One
of
the
future
aspects
of
advertising
is
the
custom-­‐made,
the
tailor-­‐made.
Instead
of
peddling
mass-­‐
produced
commodities,
advertising
is
going
to
become
a
personal
service
to
each
individual.’
This
implies
that
the
customer
should
be
seen
as
a
partner
or
associate,
not
a
target
enemy
whose
resistance
must
be
overcome.

4. •
One
of
the
single
most
effective
ways
to
destroy
quality
is
to
stick
a
wet
finger
in
the
air
and
set
short-­‐term,
arbitrary,
numeric
targets
‘to
get
people
working’.
The
gap
between
this
and
the
renewing,
ordering
imagination
based
on
intimate
and
profound
knowledge
of
customers
and
craft
is
as
wide
as
Ginnungagap,
the
void
between
worlds
in
Norse
mythology.
This
is
a
numericism
that
wants
to
impose
itself
on
the
world.
If
you
ignore
the
realities
of
the
marketplace
or
the
system
and
try
to
impose
your
own
order
onto
it,
is
it
so
surprising
that
you
should
find
yourself
obsessed
with
survival,
never
getting
off
the
bottom
rung
of
development?
•
Grocers
who
want
to
create
and
sustain
lasting
relationships
with
their
customers
use
a
number
of
time-­‐honoured
techniques,
whose
principles
cross
boundaries.
The
good
community
grocer
greets
his
or
her
customer
with
a
smile
and
by
name:
‘Hello
Mrs
Horobitz,
and
how
are
we
today?’
There
may
even
be
a
family
question:
‘And
how’s
your
son
after
his
operation?’
Produce
is
good
and
is
laid
out
openly
for
display,
and
in
the
process
of
picking
the
customer’s
order
the
grocer
would
publicly
reject
anything
considered
unsuitable
and
ostentatiously
but
naturally
throw
it
in
the
reject
bin,
in
a
gesture
that
says
‘I
care’.
There
would
be
an
extra
carrot
added
to
the
pile
after
the
scale
dipped
and
the
right
weight
had
been
reached,
an
open
display
of
natural
added
value.
There
might
be
an
occasional
treat
such
as
an
apricot
for
a
child
or
a
bunch
of
flowers
at
Christmas.
The
grocer
would
talk
cheerfully
but
not
pushily
about
products:
‘I’ve
got
a
nice
lot
of
new
potatoes
just
in.
Would
you
like
to
try
them?’
The
above
example
demonstrates
a
number
of
key
principles:
–
Acknowledging
the
person,
both
as
an
individual
and
as
a
valued
customer.
–
Having
a
dialogue
that
enables
warmth
and
knowledge
to
be
developed.
–
Being
able
to
anticipate
a
reliable
relationship,
with
few
problems,
which
are
promptly
and
courteously
dealt
with.
–
Regular
added
value
as
a
natural
extension
of
the
basic
transaction.
–
Special
attention
during
relationship
development.
–
Graceful
surprises.
•
Branding,
through
the
world
of
imagery
and
personality,
creates
a
‘being’
with
which
the
customer
can
identify...
•
Alfie
Kohn
tells
me
an
old
American
joke.
An
old
man
was
getting
insulted
by
a
group
of
10-­‐year-­‐olds
each
day.
They
would
tell
him
how
stupid
and
ugly
and
old

5. he
was.
Rather
than
shout
at
them
he
called
them
together
and
told
them
that
any
of
them
who
shouted
at
him
the
next
day
would
get
a
dollar.
Excited
and
amazed
they
all
came
round
hurled
abuse,
and
collected
their
dollar.
‘Do
the
same
tomorrow’,
he
said,
‘and
I’ll
give
you
a
quarter
for
your
trouble’.
The
children
thought
this
was
still
pretty
good,
and
turned
out
again
to
insult
him
and
earn
the
reward.
Then
he
apologized
and
told
them
that
on
the
following
day
he
could
only
afford
to
give
them
a
penny.
‘Forget
it,’
they
said
–
and
that
was
the
end
of
his
problem.
NatWest
offered
one
point
per
£10
spent,
then
one
per
£20,
and
next?
•
The
new
marketing
seeks
to
establish
an
association
through
dialogue
and
through
a
set
of
values
that
are
mutual
and
community
creating:
the
higher
levels
of
organization
quality.
Such
values
are
essentially
moral.
They
are
based
on
a
principle
of
sharing
which
becomes
gain-­‐gain.
...So,
the
ideas,
the
imagination
and
techniques
of
business
will
need
to
be
more
coloured
by
a
moral,
value
laden
outlook
if
they
are
going
to
be
successful
in
winning
and
keeping
customers
in
a
loyal
relationship.
This,
of
course,
does
not
mean
a
moralistic
attitude.
That
would
simply
be
talking
down
to
customers.
Companies
which
carve
a
great
reputation
for
themselves,
for
their
quality
and
dependability,
are
always
associated
implicitly
at
least
with
moral
worth:
with
integrity,
honest
value,
and
a
guarantee
of
worth.
•
Marketing
...becomes
service
and
the
boundaries
of
product
and
marketing
become
blurred...
While
good-­‐quality
selling
is
essentially
a
service,
paradoxically,
service
can
be
considered
as
a
sales
activity.
Service
is
the
creation
of
relationship
value
through
acts
of
care
that
satisfy
customer
needs.
Service
creates
the
company’s
future:
ensuring
that
customers
wish
to
return
to
the
same
source
for
future
purchases.
Service
creates
tomorrow’s
sales;
it
is
selling
through
a
long-­‐term
window.
The
promise
of
future
service,
if
credible,
also
produces
today’s
sales.
•
Service
transforms
the
commodity
in
personalized
interaction
with
the
customer.
It
generates
relationship
values
through
a
series
of
interactions
at
the
service
front
line.
These
are
the
threshold
moments
of
truth
when
clients
and
customers
test
our
development.
To
what
extent
will
the
quality
of
our
processes,
resources,
people,
information,
etc.,
come
together?
To
what
extent
can
we
put
the
customer’s
genuine
needs
and
preferences
first,
not
as
slaves,
but
as
partners?
Then,
good
service
transforms
commodities.
•

6. What
eventually
determines
our
loyalty,
or
the
lack
of
it,
is
the
‘archetypal
moment,’
or
moments
that
we
would
call
to
mind
about
a
company,
the
inner
mental
picture
of
the
company,
or
its
products
and
services,
and
how
we
feel
about
this.
•
The
future
will
be
marked
by
an
intensification
and
deepening
of
business
relationships.
The
model
in
Figure
8.6
is
of
this
dynamic
threshold
[moment
of
truth,
touch
point]
with
customers:
a
two-­‐way
dialogue
and
relationship
that
needs
to
adjust
to
individual
customers
and
customer
groups,
and
their
changing
needs
over
time,
as
well
as
the
organization’s
changing
needs
and
capabilities.
The
interaction
includes
all
communications,
including
product
and
service
delivery,
customer
complaints
and
requests,
telephone
contacts,
both
inbound
and
outbound,
promotional
and
service
mailings,
educational
and
promotional
events,
e.g.
seminars
and
previews,
and
face-­‐to-­‐face
meetings
or
encounters...
one
has
to
call
into
question
the
real
value
of
any
part
of
the
business
that
has
no
relationship
with
customers.
•
First
Direct
are
in
the
top
quartile
of
British
banks
in
a
Boston
matrix
measuring
‘customer
satisfaction’
and
‘willingness
to
refer’,
and
are
one
of
only
two
banks
in
this
quartile.
In
addition
to
being
the
first
British
bank
serious
about
remote
banking,
they
achieved
technical
leadership
with
implementation
of
an
event
management
or
event
trigger
system.
This
enabled
them
to
predefine
a
series
of
possible
customer
events
and
to
programme
a
desired
response,
an
idea
first
promoted
by
the
author
in
1988.
Marketing
management
define
‘rules’
and
customers
are
subsequently
selected
by
the
database
system
for
communication,
promotion
or
service,
based
on
their
event
or
behaviour
history.
This
concept,
an
event
trigger,
links
three
ideas:
1.
The
recency/frequency/value
behaviour
thinking
that
has
driven
mail
order
for
decades:
Who?
2.
The
moment
of
truth
concept:
When?
3.
Contact
management
techniques
developed
for
salesforce
management
systems
and
telemarketing
scripting,
with
emphasis
on
process
management:
What?
An
event
trigger
can
be
defined
as
‘the
configuration
of
a
system
to
recognize
particular
customers
and
their
relationship
at
a
moment
of
truth
and
thereby
stimulate
an
appropriate
action
according
to
a
predetermined
and
evolving
policy’.
•

7. The
most
important
moments
of
truth
[touch
points]
are
the
archetypal
moments,
...It
is
the
picture
and
feeling
of
the
event
experienced
by
a
customer
that
best
sums
up
his
or
her
loyalty
or
disinterest
in
a
company
or
its
products
[brand
essence].
•
Studies
of
satisfaction
show
that,
‘Satisfaction
is
not
the
pleasurableness
of
the
[consumption]
experience
…
it
is
the
evaluation
rendered
that
the
experience
was
at
least
as
good
as
it
was
supposed
to
be.’15
Satisfaction
is
an
evaluated
condition
which
arises
during
a
two
stage
process.
It
is
summarized
in
the
study
by
Westbrook
(1987)14
as:
consumption
outcome
→
affect
→
satisfaction.
This
study
also
showed
that
feelings,
which
may
be
less
conscious
(and
which
are
described
by
one
researcher
as
primitive
and
naive16)
are
more
powerful
drivers
of
word
of
mouth
recommendations
and
future
buying
decisions
than
satisfaction,
perhaps
because
of
those
very
conditions.
In
fact,
recent
scientific
studies
are
only
now
recognizing17
what
is
obvious
to
many:
the
important
role
of
feeling
and
emotion
in
judgement
and
decision
forming.
•
Of
course,
some
decisions
are
made
with
considerable
rational
input.
This
is
particularly
true
in
business-­‐to-­‐business
marketing
where
the
decision
process
tends
to
be
more
formalized
and
involves
multiple
individuals
and
organizational
specifications.
Even
here
though,
feelings
of
confidence,
warmth,
fear,
etc.,
often
influence
decisions.
Even
in
the
most
intellectual
process,
there
is
a
final
judgement:
does
it
feel
right?
Einstein
would
judge
a
theorem
on
feelings,
for
example
by
its
beauty.
The
‘feel
good’
factor
is
now
a
recognized
force
in
political
processes
and
the
economy.
•
Service
is
the
creation
of
relationship
value
through
acts
of
care
that
satisfy
customer
needs.
Service
creates
the
company’s
future:
ensuring
that
customers
wish
to
return
to
the
same
source
for
future
purchases.
Service
creates
tomorrow’s
sales;
it
is
selling
through
a
long-­‐term
window.
The
promise
of
future
service,
if
credible,
also
produces
today’s
sales.
•
The
greater
the
service
content,
the
more
likely
it
is
that
the
product
consists
of
the
capacity
of
systems
of
people,
processes
and
equipment
that
can
be
tested,
exported
and
franchised
but,
in
a
sense,
comes
into
being
only
in
memory,
imagination
and
experience
(see
Figure
8.8).
Such
a
product
cannot
be
seen,
but
exists
only
in
the
moment
by
moment
of
life
and
service
delivery:
as
the
crystal
suddenly
appears
in
the
supersaturated
solution.
•

8. Each
and
every
product
begins
first
with
an
idea
(or
concept).
Take
the
most
tangible
product
you
can
think
of,
and
you
start
with
the
idea
you
are
thinking...
So
the
core
of
a
service
product
is
a
concept:
a
haircut,
a
flight
to
New
York,
a
holiday
in
France,
a
personal
computer.
This
is
the
core,
generic,
essential
or
commodity
concept
that
can
then
be
personalized
in
two
ways
(see
Figure
8.9):
1.
Brand
image.
Not
‘a
radio’
but
‘a
Sony
radio’;
not
‘fast
food’
but
‘McDonald’s’,
i.e.
a
brand
image
which
makes
the
business
or
brand
unique
among
commodities.
2.
Customer
personalization.
Personally
recognized,
configured,
cooked,
delivered:
service
elements
that
made
the
service
product
unique
for
the
customer.
It
is
often
more
difficult
for
others
to
replicate
customer
unique
aspects
for
they
invariably
include
something
of
the
personal
relationship
between
buyer
and
seller.
All
true
personalization
of
service
and
relationship
does
this.
Of
course,
false,
unwarranted
or
inaccurate
personalization
is
simply
a
unique
form
of
customer
insult,
not
service.
•
The
specific
service
product
is
therefore
a
brand
image
and
a
service
experience
which
is
woven
in
the
moment
of
truth
from
its
delivery
attributes
–
which
correspond
to
elements
of
the
four
core
competencies
of
the
business
described
at
the
end
of
Chapter
5.
1.
Physical
or
tangible
features;
the
essential
or
core
item
2.
Activity,
movement
or
process
elements
3.
Relationship
or
personal
features,
the
human
touch
4.
Information
content,
including
data
supporting
or
developing
brand
values.
A
service
product
consists,
therefore,
of
what
we
provide
and
what
the
customer
experiences.
These
are
united
in
an
act
of
knowledge
which
is
also
the
customer’s
judgement
of
what
we
provide.
Image
and
reality
meet.
The
customer
perceives
not
only
what
we
provide,
the
tangibles,
but
also
the
way
we
provide,
the
intangible
values.
Perhaps
the
best
way
to
represent
this
is
by
an
illustration
(see
Figure
8.10),
the
magic
of
the
clover
leaf.
The
aim
should
be
to
craft
and
shape
the
service
elements
until
they
deliver
the
proverbial
crock
of
gold.
The
brand
both
unites
the
four
elements
of
the
total
service
product
and
wraps
them
in
its
values
and
image.
Customers
experience
tangible,
process,
information
and
relationship
elements
of
the
service.
One
of
the
advantages
of
this
model
is
that
it
has
complete
synergy
with
the
organization
model
(which
will
be
developed
in
the
next
chapter).
This
should
not
be
surprising.
The
distinction
between
company
and
product
is
partly
artificial
and
meets
in
the
moment
of
truth.

9. •
One
of
the
most
important
developments
over
the
next
years
will
be
the
increasing
‘intelligence’
and
information
content
in
products.
Information
is
not
only
a
component
of
the
product
package
in
its
own
right,
as
in
a
railway
timetable
or
library
database,
but
will
increasingly
transform
the
process,
relationship
and
hardware
components
of
the
product.
More
and
more
products,
for
example
financial
products,
consist
almost
exclusively
of
information
(or
expertise)
added
value.
•
It
is
therefore
crucially
important
that
the
computer
database
system
is
able
to
record
the
total
service
package,
or
at
least
all
meaningful
elements
of
it.
For
example,
in
making
a
decision
about
the
effectiveness
of
a
particular
insurance
product,
it
may
be
necessary
to
link
the
product
not
only
to
the
marketing
promotion,
but
also
to
the
particular
script
that
is
used.
Furthermore,
if
customers
telephoning
for
an
insurance
quotation
are
kept
waiting
for
a
long
time,
this
could
affect
take-­‐up
and
loyalty.
An
insurance
product
that
has
had
a
claim
is
a
different
insurance
product
from
one
that
has
not,
both
to
the
customer
and
the
company.
It
should
therefore
be
possible
to
configure
the
database
to
recognize
the
different
elements
or
entities
that
are
likely
to
be
relevant
to
total
service
product
mix.
A
technique
such
as
regression
analysis
can
then
be
used
to
link
customer
satisfaction
and
retention
to
key
ingredients
of
the
product.
It
is
less
important
to
adopt
a
particular
model
of
the
product
than
to
recognize
the
needs
to
be
able
to
link
service
components
in
an
information
system
and
measure
productive
effects.
This
is
covered
in
more
detail
in
Chapters
11
and
12.
•
A
powerful
service
guarantee
works.
It
produces
companies
that
stand
out
from
the
crowd,
and,
if
taken
seriously,
forces
commitment
to
quality.
The
result
is
a
double
impact:
–
Better
quality
service.
–
Contented
customers
willing
to
pay
for
assured
quality.
‘Guarantee
management’
is
the
end-­‐to-­‐end
establishment
of
a
market-­‐moving
commitment,
a
guarantee
of
delivery
supported
by
systems,
knowledge
and
processes.
It
is
an
idea
that
was
developed
earlier
as
a
support
for
the
development
of
treasured
reputation.
There
were
four
components:
1.
Establish
what
you
want
to
promise
(from
knowledge
of
customers).
2.
Establish
how
to
deliver
it.
3.
Make
the
offer.

10. 4.
Invite
response,
making
it
easy
if
anything
goes
wrong.
It
is
quite
obvious
that
a
guarantee
hits
straight
at
the
problem
of
reliability
while
providing
great
marketing
leverage.
And
a
guarantee
is
essentially
a
direct
marketing
device.
It
is
targeted,
it
communicates
and
it
invites
response.
Link
it
to
a
database
and
you
have
great
analytical
and
targeting
power,
e.g.
for
follow
up.
Angus
Jenkinson