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Customer satisfaction and firm performance: insights from over a quarter century of empirical research

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Listed:
  • Ashley S. Otto

    (Baylor University)

  • David M. Szymanski

    (University of North Florida)

  • Rajan Varadarajan

    (Texas A&M University)

Abstract

Emphasizing customer satisfaction as a strategic lever for enhancing business performance is a widespread business practice. However, just over 25 years of empirical studies by academic researchers has produced evidence that is sometimes contradictory. Hence, greater academic clarity and improved managerial understanding could result from a meta-analysis of the customer satisfaction-business performance relationship. To that end, the authors analyzed 251 correlations from 96 studies published between 1991 and 2017. While the satisfaction-performance relationship is positive and statistically significant on average (r = .101), more meaningful insights emerge from the explication of moderating and mediating relationships. Illustrative of these insights is the finding that satisfaction is more appropriately depicted as mediating the effects of selected marketing strategy variables on firm performance outcomes. Moreover, when satisfaction is viewed in the right setting using the right satisfaction and performance measures, a most favorable contingencies (MFC) perspective, the estimated correlation is reasonably strong (r = .349).

Suggested Citation

  • Ashley S. Otto & David M. Szymanski & Rajan Varadarajan, 2020. "Customer satisfaction and firm performance: insights from over a quarter century of empirical research," Journal of the Academy of Marketing Science, Springer, vol. 48(3), pages 543-564, May.
    • Handle: RePEc:spr:joamsc:v:48:y:2020:i:3:d:10.1007_s11747-019-00657-7
    DOI: 10.1007/s11747-019-00657-7
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