The Cost of Customer Satisfaction: A Framework for Strategic Cost Management in Service Industries

Antonella Cugini, Antonella Caru and Fabrizio Zerbini

European Accounting Review, 2007, vol. 16, issue 3, 499-530

Abstract: Customer satisfaction has long been considered a milestone in the path towards company profitability. Although it is widely acknowledged that customer satisfaction leads to higher and more stable revenues, the relationship between customer satisfaction levels and the costs that the company incurs in producing and delivering customer services has received far less attention, and the research results vary significantly across sectors. In fact, there seems to be little guidance for linking company costs to the key elements involved in providing customer satisfaction in services, thereby diminishing the ability of a company to manage its activities accordingly. In this paper, we propose and test a framework to analyse and manage the relationship between company costs and customer satisfaction in service industries. Based on a case study from the tourism industry, we show how service components can be used as a key medium to link customer satisfaction to the cost of service production and delivery. In doing so, we provide guidance for identifying specific sources of customer satisfaction and assessing their cost, thereby extending to service industries previous research on strategic cost management.

Date: 2007
References: View complete reference list from CitEc
Citations: View citations in EconPapers (11)

Downloads: (external link)
http://www.tandfonline.com/doi/abs/10.1080/09638180701507130 (text/html)
Access to full text is restricted to subscribers.

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:taf:euract:v:16:y:2007:i:3:p:499-530

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/REAR20

DOI: 10.1080/09638180701507130

Access Statistics for this article

European Accounting Review is currently edited by Laurence van Lent

More articles in European Accounting Review from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().