Customer satisfaction, earnings and firm value

Purpose – The aim of this study is to examine the relationship between customer satisfaction, earnings and firm value.Design/methodology/approach – A model borrowed from the accounting literature – the Ohlson model – is used to consider the impact of customer satisfaction on Tobin's q – a capital market‐based measure of firm performance widely used in marketing research. Data on firm performance is drawn from COMPUSTAT and integrated with data on customer satisfaction from the American Customer Satisfaction Index (ACSI).Findings – Results show that customer satisfaction has a positive impact on firm value. Critically, the authors find that this impact is over and above the impact that earnings has on firm value. They also find that customer satisfaction positively and significantly moderates the earnings‐firm value relationship.Research limitations/implications – Findings are limited to firms covered by the American Customer Satisfaction Index and subject to the assumptions underpinning the Ohlson model.P...

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