Announcing the Launch of the Customer Value Index 200: Identifying the
Leading Customer Engagement Companies
NEW YORK -- January 17, 2013
The Porter Group, Brady Capital Research (www.bradycap.com), and wRatings
Corporation (www.wRatings.com) today announced the launch of the Customer
Value Index 200 (www.cvi200.com). This innovative index offers investors an
opportunity to capture the value offered by companies that have historically
delivered high quality economic profits and developed deeply emotional
customer relationships based on cultures of transparency, authenticity, and
engagement. By combining a patented approach to identifying companies with
superior competitive positions and harnessing the power of social media the
CVI 200 offers a play on the appreciating value of “social capital” over the
next decade and the real value creating powers of strong core values, dynamic
corporate cultures, and stakeholder community focus.
The CVI 200 is a research-based analysis that provides investors with exposure
to the top 10% of North American-listed companies with a market capitalization
over $1 billion that score the highest in terms of competitive strength,
social attributes, and authentic core values. The investment thesis of the CVI
200 rests upon the premise that engaged and loyal customers are amongst the
most powerful determinants of a company’s ability to generate long-term
sustainable cash flow.
Our assessment methodology identifies the leading customer engagement
companies through the following three-tier process:
1.Competitive Strength and Social Strength Screening℠. Using wRating’s
patented customer research methodology, we identified economically
profitable companies with the highest level of competitive strength by
uncovering how companies are meeting customer functional and emotional
needs (measured in regard to moat barriers created in their supply,
product, and delivery chain). Through a proprietary back-tested algorithm,
we identified a subset of 9 of the 17 customer needs we track that most
closely associate with social strength.
2.Social Attributes Assessment℠. Our proprietary Social Attributes
Assessment℠ acts as a listening post to measure the quality with which
companies are using social media to enhance customer relationships,
organizational culture, and community relationships. It uses a Likert
Scale of 30 social “attributes” that seek to measure the firm’s level of
transparency, authenticity, and engagement.
3.Ranking by Social Capital Score℠. To select the CVI 200, we combine the
Strength Analysis℠ with the Social Attributes Assessment℠ to arrive at our
proprietary Social Capital Score℠. This ranks the final list of companies
based on how well they are generating economic profit through customer
engagement and a business built on a broader social purpose.
On a back-dated basis, the CVI 200 outperformed the S&P 500 Index since the
beginning of 2007, generating a 10.7% annualized rate of return (compared to
-0.7% for the S&P 500). Please note that historical performance is not
indicative of future performance. Since live calculation of the Index began on
November 15, 2012, the CVI 200 is up 11.2% versus 8.6% for the S&P 500, an
outperformance of 260 basis points over the two-month period.
Jeff Cherry, CEO and Managing Partner of The Porter Group, LLC, said, “We
believe a stakeholder focus and dynamic organizational cultures are the
foundation for long-term growth, sustainability and value creation. The CVI
200 represents the culmination of many years of research into the dynamic
nature of the relationships between companies and customers. We think this
analysis can give investors deep insight into a company’s ability to manage
intangible assets and generate long-term shareholder and societal value.”
Barbara Gray, Co-Founder of Brady Capital Research, added “For the last few
years, I have been driven by a dream: to create a way for people to invest in
“good” companies and play the appreciating value of the new form of equity I
call social capital.”
“The world has changed and has become so customer-driven, yet investors don’t
have any product that truly focuses on who is creating that new value,” says
Gary A. Williams, Founder & CEO of wRatings Corporation. “We’ve been tracking
competitive strength for over a decade now, and we can clearly see the power
of social capital and its impact on financial results through the CVI 200.
Better yet, investors can see it now, too.”
The Customer Value Index 200 is a rules-based, equal-weighted Index that is
calculated on a daily basis by Structured Solutions, AG, a leading global
index provider based in Frankfurt, Germany. To be included in the Index, a
company must trade on a U.S. or Canadian exchange and have a market
capitalization of at least $1 billion. Relative to the S&P 500, the Index is
overweight small-to-mid cap growth-oriented companies operating in the
consumer and information technology sectors. The Index is rebalanced on a
monthly basis and includes leading companies such as Starbucks (NASDAQ: SBUX),
Chipotle Mexican Grill (NYSE: CMG), and Whole Foods Market (NASDAQ: WFM).
Investors can discover more about the CVI 200 at the Index’s website,
Please contact us to receive a copy of our whitepaper “Customer Engagement,
Social Media and the New Paradigm in Long-Term Value Creation”.
About The Porter Group
The Porter Group (TPG) is a boutique investment consultancy and private
investment bank founded by Jeff Cherry
(http://www.linkedin.com/in/jeffcherry26) and based in New York City. TPG
provides an interconnected set of investment and strategic advice services to
support investors, investment managers, hedge funds, private equity
partnerships and executives who want to create extraordinary financial as well
as societal value.
About Brady Capital Research
Brady Capital Research is an investment research firm based in Vancouver,
Canada founded by Barbara Gray, CFA (http://www.linkedin.com/in/barbcfa), a
former top-ranked Equity Analyst, and Greg Scott
(http://www.linkedin.com/in/innovating), an entrepreneur focused on company
culture and social media. For the past three years, they have been developing
their social capital investment thesis on how social media is leading to the
creation of a new form of equity called social capital that will change
companies’ underlying risk/growth profiles and accelerate the value
creation/erosion process. For more information, visit BradyCap.com.
About wRatings Corporation
The wRatings Corporation is an independent stock research firm based in metro
Washington DC. The company was founded by Harvard Business Review author, Gary
A. Williams (http://www.linkedin.com/in/garyawilliams). He and his team
continually study customer buying behavior to project the future earnings
performance of companies. Since 1999, their original set of leading indicators
uses a common framework to measure the competitive strength of companies. For
more information, visit wRatings.com.
An investor cannot invest directly in an index. Returns reflect past
performance of the Index and do not guarantee future results. Results reflect
the reinvestment of dividends and capital gains, if any. Index returns do not
represent Fund returns. The Index does not charge management fees or brokerage
expenses, nor does the Index lend securities, and no revenues from securities
lending were added to the performance shown.
The Porter Group
Jeff Cherry, 646-561-6751
Gary A. Williams, 703-581-8208
Founder & CEO
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