Examining the Linearity of Customer Satisfaction: Return on Satisfaction as an Alternative.

Past literature has suggested maximizing customer satisfaction as a strategic choice to increase customer loyalty and ensuring revenues. However, the relationship between increased customer satisfaction and resultant revenue has remained unexamined. This research focuses on optimizing customer satisfaction rather than maximizing it. This optimization of customer satisfaction is based on maximizing profitability. In aiming for higher customer satisfaction levels with no regard to profitability, a company runs the risk of self-annihilation. Based on conceptual foundations of prior research on Return on Quality (ROQ), we propose the construct of Return on Satisfaction (ROS). We review frameworks of customer satisfaction examined by scholars in marketing and then propose a conceptual ROS model. We use empirical data (n=1597) obtained from an institution of higher education to test the conceptual model we propose. Results indicate that the data demonstrates construct validity and points to promising directions for further research. We conclude by underscoring managerial implications as well as the scholarly contributions of this research. [ABSTRACT FROM AUTHOR]