Are stores with high customer satisfaction ratings more profitable? In The Moderating Role of Competition in the Relationship Between Nonfinancial Measures and Future Financial Performance, forthcoming in Contemporary Accounting Research, Raj Mashruwala of Washington University and Rajiv Banker of Temple University suggest a link, but only when competition is stiff. Using data from more than 800 stores within a department store chain, the researchers compared employee and customer satisfaction measures to the stores' profits. In urban areas (where competition for customers was strong), the higher the level of satisfaction, the more profitable the store.
| • | Cheery customers spend more
A compilation of research produced by America's Best Business Schools U.S. News & World Report, Monday, Sept. 24, 2007 Byline: Justin Ewers, SPECIAL REPORT |
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