1. Value Promise v/s Value Delivery
Abstract:
This article is about the inevitability for organizations to move away from offering
“commodity” customer service to an “on Brand” customer service. This article focuses
on the need for organizations to align the promises that they are making while
communicating the benefits of their brand with their current and potential customers,
with the actual delivery of that promise. The benefits of such an alignment will result in
stronger brand equity, greater customer centricity, increased levels of loyalty and
concrete differentiation in the market place. The article begins with a review of the
current situation of “on Brand” service gauging some of the reasons as to why delivery is
not aligned with the promises made by the brand, and showcases some success stories.
The article then discusses a tool that provides organizations with the ability to translate
the brand promise into service delivery at every customer interaction resulting in an
authentic and memorable ‘moments-of-truth’ for the customer. This article is based on
the author’s experiences, observations, empirical evidence, and formal and informal
discussions with his clients and non-clients.
Key Words:
Brand Promise, On Brand Service, Alignment, Promise-Delivery Matrix, Brand Equity
The Author:
Ajit Rao leads the Brand & Customer Experience domain’s for Nielsen. He is the author
of “The Tao of Loyalty – Winning with Employees” and “The Little Book of Big
Customer Satisfaction Measurement”. He is based in Bengaluru, India and he may be
contacted at ajit.rao@nielsen.com
The Business Situation:
Worldwide the understanding of Customer Satisfaction has been evolving ever since it
became popular in the 1970’s and 1980’s, attributed largely to the gaining prevalence of
the various quality movements at that time. In the 1990’s, it dawned upon organizations
that measuring Satisfaction alone did not explain business outcomes well and hence
organizations moved to measuring Loyalty (in its various avatars). The 2000’s saw the
entry of the Net Promoter Score1
which became very popular because of its simplicity.
Many organizations use the NPS and several amongst them have experienced that while
the NPS is simple to measure, it does not necessarily explain business outcomes well nor
are the findings of a NPS study easily managed. Since we manage what we measure, it is
quite important for organizations to measure the right elements, and by measurement we
do not simply mean a customer satisfaction index or a NPS score, but ensuring that all
that is measured is aligned to the firm’s and brand’s strategy. It must be mentioned here
that the relationship between Customer Satisfaction and Business Outcomes is often not

2. easy to understand9
, because of the large number of imponderables involved. The
relationship is far more complex than it is made out to be and often unfolds over a long
period of time.2
My belief is that the approach to Customer Satisfaction including its measurement is
going to change in the near future. I see a number of seemingly unrelated events across
the globe. However, when I look at all these events through a certain lens, I see a distinct
pattern emerging, that of “On Brand Service Delivery”8
. On Brand Service delivery is
about ensuring that the Brand Experience is completely aligned to the Brand Promise. Let
us look at some of these discrete events that define this pattern.
1. A study of mobile service brands by Nielsen in Asia, indicates that, those brands
which are strong on both Brand Equity* and Customer Satisfaction
simultaneously, have 14 points higher market share compared to those mobile
service brands that were strong either on Brand Equity or on Customer
Satisfaction (but not both). Interestingly, this same study indicated that while
telecom service providers are well differentiated on Brand Equity, there was very
little difference on Customer Satisfaction. This meant that most telecom service
providers offer undifferentiated customer service or experience.
2. If one reviews Customer Satisfaction questionnaires2
, one would find that in any
sector, there are minor differences between the questionnaire of one brand of
service provider and another. This indicates that most companies today are
offering and measuring “commodity” customer service. The questionnaires are
mostly similar, especially in the factors (themes) and attributes that are covered in
the survey.
3. JD Power IV in his book4
on customer satisfaction provides an interesting fact
about Toyota Camry. Toyota found that in 2004, about 3 million people walked
into their showrooms to buy a car but about half walked out to buy a competitor
product. They found that it wasn’t for reasons of product quality. Some bought
other brands because of price and some for other reasons. But Toyota found that
nearly 15% of customers did not find the sales experience upto the mark. The
book quotes “after years of gaining market share on the shoulders of product
quality, Toyota now realizes that future growth will depend on providing a sales
experience that matches the quality of its vehicles”. Clearly Toyota understands
the importance of aligning its service quality to its product/ brand quality
4. An E&Y Asia Pacific Retail Banking study3
suggests that the Customer
Satisfaction scores of most banks is going up. Yet, share of wallet is decreasing,
possibly because most customers are unable to differentiate one bank from
another, based on quality of service and hence, customers end up choosing a
bank/product based on charges, fees or interest rates.

3. 5. Customers who visit Disney Land sometimes have to stand in long queues to buy
tickets for a ride. Yet, these customers are not dissatisfied when they walk out of
Disney Land because of the delivery of Disney’s promise of a “magical
experience”. In order for customers to truly experience the “magic”, Disney
makes a lot of effort to deliver the same at every moment of truth. Consider for
example, the hitching posts5
in the streets which are cleaned every night so that
they look bright and shiny every morning. Imagine, if so much attention is paid to
the hitching posts, the kind of detailing that goes elsewhere into the making of the
Disney experience truly magical. For example, Cindrella’s castle5
has bigger
stones at the bottom than those at the top. This makes the castle look much bigger
than it actually is. All this detailing ensures that the experience and feel is truly
“magical”, as promised. Disney it appears is so obsessed with the detailing5
that
the same customers see different things from the same painting or mural, every
time they visit Disney! Thus making every visit “magical”. It’s not just about the
detailing, it’s also about people. The Cast5
(as Disney employees are called) are
encouraged to drop whatever they are doing and offer to help, when they see a
guest (as Disney calls its customers) in need. If they see guests puzzling over a
map, they offer to help. If someone is trying to take a group photo, they offer to
take a picture so that everyone can be in the picture. It is such delivery of the
magical kingdom promise that makes customers go back to Disney land over and
over again! Long queues matter less to them than the magical experience!
Disney’s service is “On Brand”
6. The Southwest Airlines6
brand promise is about fun and low prices. In order to
keep prices low, Southwest Airlines does not provide passengers with meals, does
not provide baggage transfers, does not offer reserved seats and is very focused on
short hauls and secondary airports. In order to keep their service “fun”, they take
care to hire employees with a certain attitude. These “fun employees” effectively
are able to engage their customers on every flight. The employees crack jokes, do
fun things and all these are spontaneous because of the kind of employees that are
recruited and the culture that Southwest Airlines nurtures. Southwest Airlines
knows that it’s not just about delivering the promise but also about not doing
anything that does not relate to the promise!
7. Some organizations are creating a new role in their structure – Head of Customer
Experience, distinct from Head of Marketing. Here is a description of this role
from an online advertisement of one company. “Following an extensive review of
the brand, we are about to relaunch our brand with a new positioning. The Head
of Customer Experience will play a vital role in ensuring that we place the
customer and the insight central to all our business decisions and that all our

4. processes, procedures, and initiatives that touch the customer adhere to the
brand positioning.”
Why is this Happening?
Over the past several years, managers have been largely preoccupied with improving
operational effectiveness resulting in the rise of the quality movement, six sigma
movement etc. A natural fall out of these improvement efforts was the overall
enhancement in customer satisfaction.
Organizations are also benchmarking themselves with their competitors, not only within
their markets but also with companies in other regions. So when company makes a
change in any of its processes other companies quickly follow those best practices. This
tendency is resulting in ‘raising the bar’ when it comes to service delivery at customer
‘moments-of-truth’
Often, the vendors/ partners of service providers in any industry are common, for
example, network equipment providers in the Telecom space, software companies in the
banking space or management consultants. These vendors learn from one organization
and then transfer that very knowledge to another organization. This results in similar
equipment, processes and advice to organizations.
As a result, customer satisfaction of most organizations is going up. However, in the
process, there is hardly any differentiation in the services delivered from a company in
one sector to another.
Another recent global Nielsen study of mobile service providers and retail banks
indicates that the standard deviation of Brand Equity* is much higher than the standard
deviation of Customer Satisfaction. This suggests high variation in brand equity but low
variation in customer satisfaction. The Customer Satisfaction index was also found to be
higher than the Brand Equity index for each brand. Importantly, this pattern was observed
in both the categories (mobile service and retail banks) and in each of the eleven
countries in which the study was conducted. The inference is clear – while service
providers are able to differentiate themselves on “brand” in the eyes of the customer, they
have not been able to do a good job at differentiating themselves on service delivery.
Most service providers in mobile service and retail banking seem to be offering what we
are now calling “commodity service”.
This is best explained in the words of Michael Porter in his path breaking article in HBR7
.
“After a decade of impressive gains in operational effectiveness, many companies are
facing diminishing returns. Continuous improvements have been etched on manager’s
brains. But its tools unwittingly draw companies toward imitation and homogeneity.
Gradually, managers have let operational effectiveness supplant strategy. The result is

5. zero sum competition, static or declining prices, and pressures on cost that compromise
companies’ ability to invest in the business for the long term”
The challenge for most organizations is not to reduce their efforts on operational
effectiveness but to do this in a meaningful manner that will allow an organization to
truly differentiate itself based on service quality. How can an organization do this?
Every organization exists because it creates some value or benefit for its customers.
These values needs to be (a) relevant to the customer, (b) act as a differentiator from
competition and (c) should also be sustainable in the long run. . This warrants for a clear
positioning and is in the realms of strategy.
However, creating the right values is not good enough for success. The organization
needs to deliver these values/benefits to its customers at every touch point, at every
interaction that the customer has with the service provider. Simply put, the organization
needs to deliver what it promises – effectively and efficiently. Effectively – in the context
of ensuring that the customer experiences that the service provider delivers is in line with
all that is promised. Efficiently – in the context of delivering these services quickly, ‘first
time right’ and at a low cost/ no wastage.
The outcomes to an organization that creates the right values and delivers them well
cannot be over emphasized. It translates into high brand equity and therefore profits
which in turn results in an increasing base of loyal and bonded customers.
This also means that the organization is not only well differentiated in the promises it
makes, it is also well differentiated in the way it delivers service.
Whenever a Customer satisfaction report on the retail sector is made public, Walmart
often finds itself at the bottom of the table9
and then all the gurus talk about the actions
that Walmart must take to improve customer satisfaction. On the other hand Walmart is
one of the most profitable retail companies. If one looks at it from Walmart’s point of
view, they probably do not care (and thank god for that!). This is because Walmart’s
promise is “everyday low prices”. They do not promise great service and “everyday low
prices” is the reason customers walk into Walmart and the organization delivers this
consistently day on day, year on year. They are able to do this because all their systems,
processes, people are geared to delivering the lowest price possible. . Walmart has made

6. a clear and definite promise and ensures that their promise is delivered effectively and
efficiently.
This entire concept seems intuitive and simple, yet implementing this concept remains a
challenge. One reason is the organizational structure. Most firms have a Marketing head
that drives the positioning or strategy and they also have a head of Customer Service that
drives service quality or service delivery. These two positions rarely work together; often
they compete with each other for resources/budgets and also for the next promotion to
CEO/MD. My experience is that Marketing often blames Customer Service for poor
service delivery leading to customer churn. Similarly, Customer Service blames
Marketing for promising the earth to acquire customers, promises that cannot be met
with. For a Brand Promise to convert into a differentiated Brand Delivery there is a need
for these two functions – Marketing & Customer Service - to collaborate with each other.
The other key reasons for non-delivery of brand promise revolve around benchmarking,
common vendor pool, excessive focus on operational effectiveness as discussed earlier
Having said the above, the most critical reason in my opinion, is the way an organization
views the strategic importance of Service quality. Janelle Barlow and Paul Stewart8
have
suggested that organizations can follow 4 types of service strategies. We have adapted
these service strategies without losing their essence and the figure below explains the
same:

7. Organizations that look at service as a cost or service as a necessity will never end up
building great service companies. Those organizations that view service as a competitive
edge focus their energies in improving customer satisfaction. However, over time while
these companies do indeed improve customer satisfaction, they do so at the cost of poor
differentiation compared to competition. One can see this in sectors such as mobile phone
services, automobiles, retail chains and consumer banking. Hence despite improving
customer satisfaction, these sectors end up competing on price and promotions.
Those organizations that view service delivery as an expression of the brand are the ones
that will not only improve customer satisfaction but will also be seen as being “different”
compared to its competitors. The outcomes are stronger brand equity, higher levels of
customer loyalty and brand ambassadors leading to higher profits and growth! How can
an organization bring about such alignment?
A Recommended Approach:
In order to be able to align the Brand Promise with the Brand Delivery one needs a
mechanism to be able to do that. The Promise – Delivery Matrix2
is one such mechanism
that can help an organization bridge the gap between Promise and Delivery.

8. In this matrix, the Benefits or Brand promise is listed on the Y – axis. In the above
telecom example, the benefits offered by the service provider to its customers are “always
Available”, “Convenience”, “Speed”, “Friendly employees” and “Entertainment”. On the
X-axis, are listed all the points of interaction with the customers. In the above example,
the moments of truth are “Network”, “Activation”, “Recharge/ Billing”, “Call Centre”,
“Store” and “VAS”.
Every cell in the matrix contains attributes that are specific to a benefit and specific to a
moment of truth. For example, in the Call Centre area, one could have attributes such as
“The call center is open 24 hours a day” (availability), “one can connect to the call center
in the first attempt” (speed), “the call center executive resolved my problem in the first
call” (speed), “the call center executive was warm and friendly” (friendly staff) and so
on. The brand promises of the Telecom Company are now being aligned to the delivery at
the Call Centre and when surveying customers this is what is asked in the research
questionnaire as well. All the other cells can be filled up in a similar fashion. In some
cases, the cells could be empty, for example Network and friendly employees.
The mobile service provider can now measure and manage the alignment of the brand
promise with the brand delivery. This will not only enhance the brand equity of the
mobile service provider but also differentiate its service from those of its competitors.
The mobile service provider also no longer is focused on improving operational
excellence but has brought back strategy into service delivery.
Since, the Telecom Company is now measuring how its promises are being delivered; it
will also be able to track, across time periods, the impact of each of the benefits/values on
Brand Equity. From the matrix illustration above, the organization could very well find
that the contribution of “Entertainment” is going up over time while the relative impact of
“Always Available” is going down or vice versa. In a similar fashion, the service
provider can also track the impact of each of the touch points (“Network”, “Activation”

9. etc.) on Brand Equity, across time. Besides the impacts, the firm can also track how
customers are rating each of these benefits/values and touch points compared with its
competition. Using the impact and performance information, the organization can define
its future direction. This kind of approach can provide clear and insightful information to
organizations.
In order for the organization to be able to deliver Value in line with the Brand Promise,
the organization will need to make some structural changes or bring in mechanisms that
lead to better co-operation between the teams that create the Value and the teams that
deliver that Value (essentially Marketing and Customer Service). In the absence of such
co-operation, organizations will continue to measure and manage “Commodity Service
Quality” as against “On Brand Customer Experience”. The structural or other changes
could relate to common KPI’s for Marketing and Customer Service (Brand equity,
Alignment Index – for example). It could mean compulsory job rotation – from
marketing to customer service and vice versa at senior levels. It could mean that key
policies of the company (including recruitment, training, advertising, investments) are
aligned to the Brand promise. It could mean high level monthly alignment meetings
chaired by the COO or CEO.
Whether organizations like it or not, they will have to move towards “On Brand
Customer Experience”. Organizations cannot view Service delivery or Customer
Experience independent of the Brand and only as improvements in Operational
Excellence; Organizations will need to bring Strategy back into Service delivery by
ensuring that the brand promise is delivered at every interaction point with the
organization. Indeed, the management and measurement of Customer Satisfaction will no
longer be about just plain Satisfaction but about relevant Satisfaction or satisfaction in
the context of truly aligning the experience with the Brand Promise. In essence - how
well the Brand Promise is internalized into the actual delivery of the service, at every
customer interaction or moment of truth. Most organizations today manage customer
satisfaction from an “inside –out” view. Hence, the focus is usually on improving
processes, systems, training of people etc. since the lens of the organization is on the
delivery points such as the call center or the store rather than on the customer’s needs.
However, customers do not care if an organization has a call center or not. Customers
don’t care whether the firm has 500 stores or 1000 stores. What customers want are
benefits like convenience or availability or speed or problem resolution. When the
organization looks at customer satisfaction as On Brand customer experience, the lens of
the organization is “outside-in”. The starting point becomes the customer. The focus of
the organization is not just on improving the processes but improving, reinforcing and
enhancing the benefits or promises such as convenience or speed that the organization
makes to its customer. This approach needless to say makes the organization customer
centric and as we all know such an approach has a positive impact on the Brand equity
and hence loyalty and profits.
To conclude:

10. 1. Organizations need to clearly define what it will promise to its customers. The
promise(s) should be relevant to its customers, well differentiated from
competition and sustainable.
2. However, this by itself does not help the organization. The organization needs to
deliver these promises at every touch point with the customer – effectively and
efficiently. In order to manage this, the firm will need to redefine the way it
measures customer satisfaction to ensure that the measurement revolves around
the alignment of delivery to the promises made. The Promise-Delivery matrix is a
tool that can help organizations build the alignment.
3. The organization needs to communicate the promises it makes to its customers in
a consistent manner. The communication could also include aspects that the
service provider will not offer its customers (as in the case of Southwest Airlines)
and finally
4. The benefits of such an approach are immense to any organization. It means a
customer centric organization, it means an organization that is not only able to
differentiate itself on the promises it makes but also on its experience or service
delivery and therefore it means stronger brand equity leading to loyalty and
profits
*Nielsen has a proprietary way of measuring Brand Equity amongst
consumers/customers.
Note: For emphasis, some key words and sentences have been italicized by the author
References:
1. Fred Reichheld, The Ultimate Question, Boston, Harvard Business Press, 2006
2. Subash Chandra and Ajit Rao, The Little Book of Big Customer Satisfaction
Measurement, New Delhi, Sage Publications, 2012
3. E&Y Asia Pacific Retail Banking study – Pursuing Customer Loyalty, 2010 (Location
not mentioned in the paper)
4. Chris Denove and James D Power IV, Satisfaction, New York, Penguin Portfolio, 2006
5. Tom Connellan, Inside the Magic Kingdom, Austin, Texas, Bard Press, 2003
6. Kevin Freiberg and Jackie Freiberg, Nuts, Broadway Books, 1998 (Location not
mentioned ISBN no 0767901843, 9780767901840)
7. Michael E. Porter, What is Strategy?, Harvard Business Review, November-December,
1996 (location not mentioned…probably Boston, Massachusetts)
8. Janelle Barlow and Paul Stewart, Branded Customer Service The New Competitive
Edge, San Francisco, Berett-Koehler Publishers, 2004.2005
9. Timothy Keiningham, Sunil Gupta, Lerzan Aksoy and Alexander Buoye, The High
Price of Customer Satisfaction, MIT Sloan Management Review, Spring 2014, Vol.
55, No. 3 (location not mentioned…probably Boston, Massachusetts)