The distinction between product and service is irrevocably blurred. All products carry a periphery of services on which their value depends.

Interactions between supplier and customer determine the value of products and services. Thus, an offering is not only the output of one value-creation system, but also an input to another.

Products and services are not the only components of value to a customer; the relationship itself is also of value. This relationship refers to the co-operative actions and their psychological effects that may enhance overall value. A firm that pursues relationship marketing - and develops tighter social ties with its customers - provides customers with value added on top of the value provided by the product or service. Consequently, an offering contains three value contributors of varying proportions: the product, the service and the relationship - or people - components.