Customer satisfaction is flat; wave of ‘pent-up customer defection' building
Customer satisfaction is flat and that's a warning sign, according to the latest release from the American Customer Satisfaction Index.
During the past six months, the Index has remained unchanged — even at the first decimal, the report revealed. From a sample of about 200,000 customers, the national ACSI score holds at 76.9 (out of 100) for the fourth quarter of 2025. On an annual basis, the Index fell by 0.5% and has not materially increased since 2017.
At the macro level, compounding market concentration, increasing seller pricing power and higher buyer switching costs are major causes for the lack of improvement. At the micro level, irrelevant performance metrics and data-discordant analytics have made resource allocation for strengthening customer relationships next to impossible.
According to the report, a wave of "pent-up customer defection" is building. Stagnant satisfaction, rising complaints and higher switching costs are creating a stockpile of latent churn that can release suddenly when barriers drop.
In other key takeaways, market concentration is masking real economic fragility, the report said. With fewer competitors and greater pricing power, firms can raise prices without improving the customer experience — a pattern that historically precedes slower GDP growth and rising inflation.
“In well-functioning markets, buyer satisfaction and seller profits move together," said Claes Fornell, founder of the ACSI and the Distinguished Donald C. Cook Professor (Emeritus) of business administration at the University of Michigan. "When seller profits increase without a corresponding rise in buyer utility, it is an indicator of market inefficiency. Decoupling seller profit from buyer satisfaction impedes economic growth and slows innovation. Buyer surplus stagnates and inflation accelerates.”
Escalating M&A activity, without a corresponding increase in antitrust enforcement, has compounded the problem, added Fornell.
“Tariffs have had a similar effect by discouraging international competition,” he said.
Founded in 1994 at the University of Michigan's Ross School of Business, the American Customer Satisfaction Index measures customer satisfaction with more than 400 companies in over 40 industries, based on approximately 200,000 annual interviews.
To read the full release, click here.
