A little experiment I ran shows some definite indications of that. Now, I am nobody's data analyst, I don't even play one on TV. I do know when numbers tell a story however. I also am a big believer in the power of words.
So, I wondered, if a company is really focused on its customers, that would show in the words of its top executives. And if it showed in the words of its executives, would that have any correlation to a company's performance?
In order to do a controlled experiment, I chose the following, using a client as a baseline.
Words:
How regularly did the executives of public companies use the word customer in their latest earnings release call with the street? This is expressed as occurrences of "customer" vs total words in the call. The comparison is off of my client's baseline. So, for instance, Comp 5's execs used "customer" 126% more often than my client, and Comp 1's used it about 1/3 less.
As another comparison, I compared how often the execs used the word "account" (controlled for versions such as accounting, etc) vs using the word "customer". Comp 1's execs used "account" the most. Three companies' execs only used the word customer...not account.
Performance:Set against the words analysis, is the 6 month stock performance of the companies. Also, several market indexes are included for comparison.
As you can see, there is a fairly clear correlation.
Is this the do-all end-all of analyses? No.
Is there enough here to warrant looking further into it? Yes.
Has anyone done any research that contradicts this? Not yet!
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