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Customer Satisfaction and Links to Customer Profitability: An Empirical Examination of the Association between Attitudes and Behavior

Author

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  • Söderlund, Magnus

    (Dept. of Business Administration, Stockholm School of Economics)

  • Vilgon, Mats

    (Dept. of Business Administration, Stockholm School of Economics)

Abstract

This paper explores links between customer satisfaction, repurchase intentions, purchase behavior, and customer profitability with empirical data on attitudes, behavior, and profitability at the customer level of analysis. Purchase behavior and profitability data, derived from the accounting system of a firm, are matched with the responses of the firm's customers to survey questions distributed prior to the behavior and profitability outcomes. The analysis reveals a strong link between customer behavior and customer profitability, while modest links exist between repurchase intentions and subsequent behavior. Only a weak and non-significant direct link can be observed between customer satisfaction and customer profitability. This paper, then, questions customer satisfaction's commonly assumed role as a proxy for profitability.

Suggested Citation

  • Söderlund, Magnus & Vilgon, Mats, 1999. "Customer Satisfaction and Links to Customer Profitability: An Empirical Examination of the Association between Attitudes and Behavior," SSE/EFI Working Paper Series in Business Administration 1999:1, Stockholm School of Economics.
    • Handle: RePEc:hhb:hastba:1999_001
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    Citations

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    Cited by:

    1. Danielle C. Sanderson, 2014. "Treating the Tenant as a Customer: can good service improve real estate performance?," Real Estate & Planning Working Papers rep-wp2014-04, Henley Business School, University of Reading.
    2. repec:dgr:rugsom:04f08 is not listed on IDEAS
    3. R. Arivazhagan & P. Geetha, 2011. "A Study on Consumer Awareness and Satisfaction towards Orange Flavored Soft Drinks in Tier-I Cities of Tamilnadu," Indian Journal of Commerce and Management Studies, Educational Research Multimedia & Publications,India, vol. 2(7), pages 15-22, November.
    4. Teerling, Marije L., 2004. "How about integration: the impact of online activities on store satisfaction and loyalty," Research Report 04F08, University of Groningen, Research Institute SOM (Systems, Organisations and Management).

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