Relating customer satisfaction with competitive advantage: An empirical study from pharmaceutical industry

Customer value is the next source for competitive advantage. This paper proposes a "Customer-Company-Information-Value" model. Divided into two categories (i.e. external and internal), a total of 272 customers from pharmaceutical industry are surveyed on the dimensions of perception, satisfaction and loyalty to study the interaction between customer satisfaction and competitive advantage. Nonparametric Mann-Whitney U is introduced for statistical test. The result finds that the relationship between customer satisfaction and competitive advantage is positive while there exists a slight difference between external and internal customers' perspectives due to their professional background. Moreover, it probes into the current gap between foreign invested and domestic pharmaceutical companies. "Brand over price" is a fact in the current Chinese pharmaceutical market. The study suggests that the customer satisfaction index should not be treated merely as a barometer, the long-term nature of the competitive advantage from improving customer satisfaction has broad strategic implications. Successful companies should embrace a more effective model to optimize internal and external customer satisfaction, and place adequate value on the link between internal and external consumers in order to both sustain profitability and gain the competitive advantage that others would seek to emulate.