Disentangling the market value of customer satisfaction: Evidence from market reaction to the unanticipated component of ACSI announcements

Vladimir Ivanov, Kissan Joseph and M. Babajide Wintoki

International Journal of Research in Marketing, 2013, vol. 30, issue 2, 168-178

Abstract: There is a rich literature that examines the impact of customer satisfaction on market value. Surprisingly, the short-run market impact of customer satisfaction has been found to be either insignificant or limited in scope. To address this shortcoming, we introduce the notion that investors form expectations about customer satisfaction and respond only to deviations from these expectations (i.e., “surprises”). We consider two “expectations” models: a naïve model that utilizes last year's scores and a model that includes firm characteristics and marketing investments to proxy for the prior allocation of resources devoted to improving customer satisfaction. In our empirical work, we find that the market does indeed respond in the short-run to surprises in customer satisfaction, with more pronounced effects for our second expectations model. Overall, our research offers two distinct contributions. First, it refines the current conceptualization of customer satisfaction by explicitly introducing the notion of investor expectations. Second, we employ this refined conceptualization to unequivocally demonstrate the short-run impact of investments in customer satisfaction.

Date: 2013
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (7)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0167811612000754
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:ijrema:v:30:y:2013:i:2:p:168-178

DOI: 10.1016/j.ijresmar.2012.09.003

Access Statistics for this article

International Journal of Research in Marketing is currently edited by Roland Rust

More articles in International Journal of Research in Marketing from Elsevier
Bibliographic data for series maintained by Catherine Liu ().