Institutional investors such as equity funds increase their holdings in companies where customer satisfaction improves.
Researchers at Aalto University in Finland found that companies in uncertain product markets such as consumer electronics were particularly exposed to changes in satisfaction.
“It’s somewhat surprising to find that transient institutional investors, who we often see as focusing only on quarterly profit forecasts, also react to customer satisfaction, which reflects a firm’s long-term marketing competence,” said study leader Jaakko Aspara.
Read more at Aalto University School of Business