How To Beat The Stock Market: Buy Companies With High Customer Satisfaction Scores

How To Beat The Stock Market: Buy Companies With High Customer Satisfaction Scores http://consumerist.com/consumer/personal-finance/how-to-beat-the-stock-market-buy-companies-with-high-customer-satisfaction-scores-261282.php Using a back-tested paper portfolio and an actual case, the authors of a study published in the Journal of Marketing found that companies at the top 20% of the the American Customer Satisfaction Index (ACSI) greatly outperformed the the stock market, generating a 40% return. From 1996-2003, the portfolio outperformed the Dow Jones Industrial Average by 93%, the S&P 500 by 201%, and NASDAQ by 335%. Past performance doesn't indicate future results. ACSI only goes back to 1994. However, these startling findings help vindicate one of our central claims: investing in customer service and satisfaction is good for your bottom line. "Cost-cutting" and "profit-enhancing" measures like outsourcing all your tech support to India, creating a byzantine apparatus for warranty repairs, and using rebate systems designed to trip up your customers will only hurt you in the long run. — BEN POPKEN