prior to this relationship.
2 The enterprise learns more about its own strengths and weaknesses from each interaction and from the customer's feedback, and is therefore able to market, communicate, and handle some aspects of its own tactics or strategy more efficiently and effectively than was possible prior to the relationship.10
Cultivating Learning Relationships depends on an enterprise's capability to elicit and manage useful information about customers. Customers, whether they are consumers or other enterprises, do not want more choices. Customers simply want exactly what they want—when, where, and how they want it. And technology is now making it more and more possible for companies to give it to them, allowing enterprises to collect large amounts of data on individual customers' needs and then use that data to customize products and services for each customer—that is, to treat different customers differently.11 This ability to use customer information to offer a customer the most relevant product at the right price, at the right moment, is at the heart of the kind of customer experience that builds loyalty and share of customer.
Customers, whether they are consumers or other enterprises, do not want more choice. Customers simply want what they want, when, where, and how they want it.
One of the implications of this shift is an imperative to consider and manage the two ways customers create value for an enterprise. We've already said that a product focus tends to make companies think more about the value of a current transaction than the long-term value of the customer who is the company's partner in that transaction. But building Learning Relationships has value only to a company that links its own growth and future success to its ability to keep and grow customers, and therefore commits to building long-term relationships with customers. This means we find stronger commitments to customer trust, employee trust, meeting community responsibilities, and otherwise thinking about long-term, sustainable strategies. Companies that are in the business of building the value of the customer base are companies that understand the importance of balancing short-term and long-term success. We talk more about that in Chapters 6 and 11.
Notes
1 1 Vikas Kumar, “Building Customer-Brand Relationships through Customer Brand Engagement,” Journal of Promotion Management 26, no. 7 (July 2020), p. 986–1012, doi:http://dx.doi.org/10.1080/10496491.2020.1746466, accessed June 7, 2021. Also, Christof Binder and Dominique M. Hanssens report research on brand valuation of a company at the time of merger or acquisition. They discovered that over a 10-year period from 2003 to 2013, “brand valuations declined by nearly half (from 18% to 10% [of total company value]) while customer relationship values doubled (climbing from 9% to 18%). Acquirers have decisively moved from investing into businesses with strong brands to businesses with strong customer relationships.” See “Why Strong Customer Relationships Trump Powerful Brands,” Harvard Business Review, April 14, 2015, available at https://hbr.org/2015/04/why-strong-customer-relationships-trump-powerful-brands, accessed August 17, 2021.
2 2 Priyanka Meena and Praveen Sahu, “Customer Relationship Management Research from 2000 to 2020: An Academic Literature Review and Classification,” Vision 25, no. 2 (June 2021): 136–58, https://doi.org/10.1177/0972262920984550; Ju-Yeon Lee, Shrihari Sridhar, Conor Henderson, and Robert W. Palmatier, “Effect of Customer-Centric Structure on Firm Performance,” Marketing Science Institute Working Paper Series, Report No. 12–111, available at https://www.msi.org/wp-content/uploads/2020/06/MSI_Report_12-1111.pdf, accessed August 17, 2021; Sunil Gupta and Donald R. Lehmann, Managing Customers as Investments (Philadelphia: Wharton School Publishing, 2005); Robert S. Kaplan, “A Balanced Scorecard Approach to Measure Customer Profitability,” Harvard Business School's Working Knowledge Web site, August 8, 2005, available at: https://hbswk.hbs.edu/item/a-balanced-scorecard-approach-to-measure-customer-profitability, accessed August 17, 2021; Don Peppers and Martha Rogers, The One to One Future (New York: Doubleday Books, 1993); and Fred Reichheld and Rob Markey, The Ultimate Question 2.0: How Net Promoter Companies Thrive in a Customer Driven World (Cambridge, MA: Harvard Business Review Press, 2011).
3 3 Thanks to the SalesForce Marketing Cloud website for inspiring many of these examples; “Marketing Cloud Customer Stories,” Salesforce, available at https://www.salesforce.com/products/marketing-cloud/customer-stories/, accessed April 14, 2021.
4 4 Barton Goldenberg, “CXM: Give Your Customers the Experiences They Want,” CRM Magazine 21, no. 4 (April 2017): 6; Ranjay Gulati, Reorganize for Resilience: Putting Customers at the Center of Your Business (Cambridge, MA: Harvard University Press, 2010). Also see Don Peppers and Martha Rogers, Ph.D., One to One B2B (New York: Doubleday Broadway Books, 2001).
5 5 Colin Dwyer, “Barnes & Noble Set to Be Sold to Elliott Management for about $683 Million,” NPR, June 7, 2019, available at https://www.npr.org/2019/06/07/730638739/barnes-noble-set-to-be-sold-to-elliott-management-for-about-683-million, accessed August 17, 2021; “Amazon.com, Inc. Common Stock (AMZN),” Nasdaq, available at https://www.nasdaq.com/market-activity/stocks/amzn, accessed August 17, 2021.
6 6 Bernd W. Wirtz and Peter Daiser, “Business Model Development: A Customer-Oriented Perspective,” Journal of Business Models 6, no. 3 (2018): pp. 24-44; Srividya Sridharan, “Evolve Your Approach to Acquisition and Retention,” Forrester Research, Inc., December 12, 2012, available at www.forrester.com.
7 7 Marco Bertini and John T. Gourville, “Pricing to Create Shared Value,” Harvard Business Review, June 2012, available at https://hbr.org/2012/06/pricing-to-create-shared-value, accessed August 17, 2021. See also Don Peppers and Martha Rogers, Ph.D., The One to One Manager (New York: Doubleday, 1999).
8 8 B. Joseph Pine II, Don Peppers, and Martha Rogers, Ph.D., “Do You Want to Keep Your Customers Forever?” Harvard Business Review 73, no. 2 (March–April 1995): 103–114.
9 9 B. Joseph Pine II, Don Peppers, and Martha Rogers, Ph.D., “Do You Want to Keep Your Customers Forever?”
10 10 Steve Blank, “Why the Lean Startup Changes Everything,” Harvard Business Review, May 2013, available at https://hbr.org/2013/05/why-the-lean-start-up-changes-everything,