We provide a mathematical framework for assessing the value of custome
r satisfaction. The framework enables managers to determine which cust
omer satisfaction elements have the greatest impact, and how much mone
y should be spent to improve particular customer satisfaction elements
. This makes it possible to hold customer satisfaction programs accoun
table, in the way that other business programs are held accountable, b
y forcing them to demonstrate their benefits with respect to bottom-li
ne profitability. We use an individual-level model of loyalty and rete
ntion, and then build up to market share by aggregation. We demonstrat
e the application of our approach in a pilot study of a city's retail
banking market.