Study: Customer Service Boosts Stock Price

A study published in January 2006 in Journal of Marketing: "It is possible to beat the market consistently by investing in forms that do well on the ACSI [American Customer Satisfaction Index." Consumerist, which has a pdf copy of the article, explains, "Companies at the top 20% of the the American Customer Satisfaction Index greatly outperformed the the stock market, generating a 40% return."

Interesting. Would it be possible to beat the ASCI's quarterly schedule by ordering your own Net Promoter surveys for selected companies? Is anyone doing this already? Comments? (moderated).

Update: here's a study from London School of Economics that links Net Promoter Score and company (and stock) performance.


  1. This is not precisely what you were asking, but Motley Fool referenced Net Promoter in an article called "Companies You Should Buy Right Now article":

    "What makes a great company? That's the rub. There can be a lot of ways to measure greatness. eBay (Nasdaq: EBAY) and Southwest Airlines (NYSE: LUV), for example, have high net promoter scores."

    Here is a link to the article:

  2. Very interesting blog. An investment strategy based on NPS won't work. In fact, look closely at the London School of Economics paper. They measure revenue growth in 2004 and then did a study in the summer of 2005 to measure NPS. A major flaw in their research. If anything, the best assumption you could come up with is that revenue growth drives NPS.

    How could you use data like that in an investment strategy. If that is the best data they can come up with, that tells us a lot.

    There is enormous financial evidence published on the predictive capabilities of the ACSI.


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