ANN ARBOR, Mich. (October 31, 2020) — In competitive markets, firms are rewarded for treating their customers well and punished for treating them badly. The former gains in profit and share price; the latter doesn’t. So too in political markets.
In economic terms, this year’s presidential race is basically taking place in a market duopoly: There are only two significant brands, “Trump” and “Biden,” and the one that captures a 50% market share will win the popular vote.
“Customer” satisfaction among the nearly 63 million who voted for Donald Trump in 2016 points to a “repurchase” by 53 million, as per the American Customer Satisfaction Index (ACSI®).
In a duopoly, the incumbent brand typically has the upper hand, and loyalty is often stronger than it is in a monopsony. Trump has a satisfaction score of 75 (out of 100) – roughly equal to the national ACSI average of 75.3 and much higher than the public sector (66.7). Consistent with what would be expected in a duopoly, he benefits from a high repurchase probability: 84% of those who voted for him in 2016 are likely to do so again.
“If the number of voters remains the same as in the 2016 election (137 million), that would propel him to victory,” said Claes Fornell, ACSI Founder and Chairman. “However, voter turnout is projected to grow to around 150 million. If correct, Biden would win because Trump would need another 22 million, in addition to the 53 million he is likely to get from loyalists, which is unlikely.”
These additional votes would have to come from “brand switchers” and new voters. Average polling estimates suggest that Trump would get no more than another 14 million. Accordingly, if the turnout reaches 150 million, ACSI predicts that Trump will get 44.7% of the popular vote, compared to 53.8% for Biden. Should voter turnout be more in line with what it was in 2016 (137 million) Trump would get 48.9% and win the popular vote. However, the data suggest record voter turnout and thus a Biden win.
Only three times in almost 90 years has a challenger won the presidency. 2020 is set to break that norm because the president’s market share is too small to be offset by customer satisfaction or loyal customers. With an estimated increase in voting to 150 million from about 137 million in 2016, Trump’s starting point of 53 million “repurchasers” would not be enough. Robust early voting may push total voter turnout even higher. However, the lower the turnout, the higher the likelihood that Trump wins.
Methodology
The ACSI does NOT survey the public at large – only customers of the companies included. For this analysis, the same principle was applied to the presidential race: Only those who voted for Trump were surveyed. The only additional piece of information needed for prediction is the size of the market – in this case, the total number of voters.
The ACSI Trump survey is based on data from October 26-27, when 1,000 individuals drawn from a nationally representative online sample of Trump 2016 voters were surveyed. Respondents were asked ACSI questions about their satisfaction with Trump as President and how likely they were to vote for Trump again in 2020. The likelihood estimate is .84 with a margin of error at +/-.017.
This press release is also available in PDF format.