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Treating Customers Well is Good for Business

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A good product isn’t enough for many consumers who are looking for ways to align their purchases with their values. Companies that consistently provide high quality customer service know that protecting their brands matters—starting with how they treat their customers.

Keeping Customers Happy

In today’s social media-driven world, both positive and negative opinions that resonate broadly can go viral almost instantaneously. At the same time, consumers increasingly believe in aligning their spending with their ideals, and are sensitive to how companies treat the customers who are essential to their success.

Finding Value in Companies’ Customer Relationships

Parnassus’s qualitative ESG (environmental, social and governance) review includes all aspects of a company’s relationships with its customers, such as customer service, product safety, recalls and privacy issues. The investment team also evaluates the overall brand as part of their detailed assessment of a company’s moat, or competitive advantages. Examples of companies with healthy brands and commendable customer service that are held in Parnassus’s portfolios include:

  • Starbucks®, which offers an attractive loyalty rewards program and is close to reaching their goal of 100% sustainably grown coffee
  • Apple, which simplifies the process of getting support for their complex products with their in-store Genius Bars staffed by well-trained employees
  • Nordstrom, which has an outstanding returns policy, member perks and high-touch, professional in-store service
  • The Walt Disney Company, which emphasizes ethical marketing, using their brand assets to promote healthier food choices and disallowing depictions of tobacco or smoking
  • Prioritizing Customer Loyalty

    Fostering outstanding relationships with customers is essential for businesses because the most valuable asset a company holds is their customer base. Companies that take extra steps to stand out with exceptional service will likely be rewarded with enhanced loyalty—and this will be reflected on their bottom line.



    As of 06/30/2017, percentage of the Parnassus Core Equity Fund represented by the companies in this article are as follows: AAPL is 3.0% and DIS is 3.7% of TNA. Percentage of the Parnassus Endeavor Fund represented by the companies in this article are as follows: AAPL is 0.5% of TNA. Percentage of the Parnassus Asia Fund represented by the companies in this article are as follows: AAPL is 1.4% of TNA. Percentage of the Parnassus Fixed Income Fund represented by the companies in this article are as follows: Starbucks due 10/1/23 is 1.6%, Starbucks due 6/15/26 is 0.8%, Apple due 5/13/45 is 0.7%, Apple due 2/23/23 is 1.7%, Nordstrom due 10/15/21 is 0.6%, Nordstrom due 3/15/27 is 0.8% and Walt Disney Comp. due 2/12/21 is 1.7% of TNA.

    Mutual fund investing involves risk, and loss of principal is possible.

    The views expressed are subject to change at any time in response to changing circumstances in the markets and are not intended to predict or guarantee the future performance of any individual security, market sector or the markets generally, or the Parnassus Funds. Current and future portfolio holdings are subject to risks.