| Abstract Text: |
A number of recent marketing studies examine the stock market’s response to the release of
American Customer Satisfaction Index (ACSI) scores. The broad purpose of these studies is to
investigate the stock market’s valuation of customer satisfaction. However, a key focus is on
whether customer satisfaction information predicts long-run returns. We provide evidence on
the market’s pricing of ACSI information using a more comprehensive set of well-established
tests from the accounting and finance literatures. We find that ACSI scores provide some
incremental information on future operating income and that the market quickly responds to the
release of information on large increases in satisfaction. However, we find no evidence that
ACSI predicts long-run returns. These results suggest that customer satisfaction information is
value-relevant, but are also consistent with Jacobson and Mizik’s (2009) conclusion that
mispricing of ACSI information, if present at all, is limited. |
