Run your business like an S&P 500 company. No, really. We leveraged our proprietary alternative data engine to generate this list of why S&P 500 companies consistently lead their industries on all fronts, with data sourced from SEC filings.
Being known as a leader in any industry, for any reason, is a facet of brand equity that cannot be underscored. MGM International consistently sets the bar for customer service and experience for the hospitality industry, building a loyal customer base with high ROI and high brand recognition. Charter Communications also cites this as an intentional, integral part of their marketing and business strategies: “Our operating strategy includes insourcing nearly all our customer care and field operations, which results in higher quality service delivery.” If customers know their Customer Value ratio will be high (CV = benefits/price), they’ll come back again and again.
Every industry in this index innovates, and the leaders stand out because of it. For example, CBOE Global Markets is a leader in the investment and trading industry and attracts customers to their firm in part because of their mission statement: “Drive the global marketplace forward through product innovation, leading edge technology and seamless trading solutions.” In a more tangible way, Union Pacific Corp is innovating in the railroad industry – making trains faster, their cars more energy efficient, and routes streamlined.
Innovating is important, but the strongest firms in the index take advantage of their core competencies – for example, their brand equity, physical assets, and employees. Kansas City Southern recognizes the strategic location of its rail network, and actively implements strategies to extract everything it can from that existing asset. In a more intangible sense, Netflix realizes it has close to 200 million monthly subscribers and should use this existing platform to create and share their own Netflix originals. They don’t have to pay acquisition costs and draw people to their service, especially when they create hits like Outer Banks or The Crown that can only be seen through Netflix.
“To win in the marketplace you must first win in the workplace.” Doug Conant, former CEO of the Campbell Soup Co, made this claim which still drives a lot of what the company does today. A key 2020 goal of theirs was to build a winning team and culture. Another notable example of this is the Prudential Financial professional development programs. Called “Skills Accelerators,” they are programs that current Prudential employees can access to close gaps in their resumes, and in turn bring value back to Prudential and its clients.
ESG, or Environmental, Social, and Corporate Governance, is a buzzword of the past few years, and more than ever, investors are demanding that firms meet certain scores on criterion, both for ethical and financial reasons. Most S&P 500 companies recognize this demand and adopt better practices to score higher. For example, Eaton Corp., a leading energy company, is working to implement more energy efficient solutions for its customers and is staying relevant because of it. Kraft Heinz releases an annual ESG report, which outlines its goals and related metrics for tracking those ESG practices.
Every company has some idea of where they want to be in ten years. Top companies build their entire corporate strategy around it – every investment decision, every hiring choice, every news release is crafted for the long term. Morgan Stanley is a prime example of this, and their results reflect a clear, concise goal that its employees can get behind and execute. Alphabet, Google’s parent company, also thinks long term, with several “Other Bets” (emerging businesses in process of development) that will keep the firm relevant long-term.
Maybe your firm isn’t trying to compete against giants like Amazon or Bank of America. Either way, Intrinio’s alternative data works to get the answers you want about how to run your business a little differently or unlock some critical insights into why some firms outperform the market consistently.
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