When the going gets tough,ads become straightforward but multi-appealed: The influence of the recession on financial services advertising appeals

Although many scholars and researchers have contributed to the sizeable literature on the relationship between advertising and society, few have examined economic circumstances as a meaningful force shaping advertising. This study provides the empirical evidence that changes in economic conditions, the recession in particular, can transform advertising appeals. The analysis of 1488 financial services ads placed in two popular US magazines showed that the patterns of appeals have turned to direct assertive styles in the wake of the economic crisis of the period 2008–2009. At the same time, however, ads during this recession period have used a far wider variety of strategic and tactical appeals than those in pre-recession era.     

When the going gets tough,ads become straightforward but multi-appealed: The influence of the recession on financial services advertising appeals

Although many scholars and researchers have contributed to the sizeable literature on the relationship between advertising and society, few have examined economic circumstances as a meaningful force shaping advertising. This study provides the empirical evidence that changes in economic conditions, the recession in particular, can transform advertising appeals. The analysis of 1488 financial services ads placed in two popular US magazines showed that the patterns of appeals have turned to direct assertive styles in the wake of the economic crisis of the period 2008–2009. At the same time, however, ads during this recession period have used a far wider variety of strategic and tactical appeals than those in pre-recession era.     

A content analysis of financial services magazine print ads: Are they reaching women?

The financial services industry has undergone what can only be called a ‘transformation’ over the last 25 years. Deregulation has increased competition in all sectors. Thus, firms must understand the needs of their customers. The number of women as financial services decision makers has been rapidly growing, and it is estimated that within 15 years women will represent over 65 per cent of top wealth-holders. This study looks at how the financial services industry communicates with potential women customers through print advertising. The most frequently used appeals when advertising in women's magazines are similar to those used in men's magazines, but they differ from those used in general magazines. Surprisingly, advertisers, however, do not seem to tailor their ads differently to women than to men, despite evidence that women respond to different approaches.     

Advertising in the mutual fund business: The role of judgmental heuristics in private investors' evaluation of risk and return

Effective advertising strategies are of growing importance in the mutual fund industry due to keen competition and changes in market structure. But the dominant variables in financial decision making, investor's perceived investment risk and expected return, have not yet been analysed in an advertising context, although these productrelated evaluations can be influenced by advertising and therefore serve as additional indicators of advertising effectiveness. In this study, the authors use a large-scale experimental study (n=499) to detect how risk-return assessments of private investors are influenced by specific elements of print ads. In this context, judgmental heuristics used systematically by private investors play a crucial role.     

Targeted advertising and advertising avoidance

I examine how the increasing ability of firms to target their ads influences market outcomes when consumers have access to advertising‐avoidance tools. Although firms generally benefit from improved targeting, consumers need not. I also show that there may be too little blocking of ads in equilibrium and consider the role of targeted advertising when niche firms compete against mass‐market firms.     

The role of creative strategy,ad disclosure and regulatory focus in investors’ decision making: An experimental investigation

This study examines the effects of creative strategy and ad disclosure in financial services advertising (FSA) and individual differences in regulatory focus on retail investors’ attitudes and behavioral intentions. Results from a between-subject experiment indicate that investors’ regulatory focus (promotion focus versus prevention focus) moderates the effects of FSA related to creative strategy and ad disclosure. Specifically, prevention-focused investors (promotion-focused investors) had more favorable attitudes towards and showed greater purchase intentions of a financial product when exposed to informational ads and ads with disclosures (transformational ads and ads without disclosures). The authors offer theoretical, managerial and public policy implications.     

Is Investor Attention for Sale? The Role of Advertising in Financial Markets

Prior research documents capital market benefits of increased investor attention to accounting disclosures and media coverage; however, little is known about how investors and markets respond to attention‐grabbing events that reveal little nonpublic information. We use daily firm advertising data to test how advertisements, which are designed to attract consumers' attention, influence investors' attention and financial markets (i.e., spillover effects). Exploiting the fact that firms often advertise at weekly intervals, we use an instrumental variables approach to provide evidence that print ads, especially in business publications, trigger temporary spikes in investor attention. We further find that trading volume and quoted dollar depths increase on days with ads in a business publication. We contribute to research on how management choices influence firms' information environments, determinants and consequences of investor attention, and consequences of advertising for financial markets.     

The Effects of Advertising on Mutual Fund Flows: Results from a New Database

We examine 471,000 mutual fund company advertisements from 1997 to 2003 to study advertising's effect on fund inflows. We find advertising is generally ineffective in attracting inflows but was more effective during the bear market despite smaller advertising expenditures during this time. The top 10 advertisers in our sample were most successful in capturing inflows. These companies generated inflows with mutual fund ads; other companies succeeded when advertising their other products and their brand image. Within a fund family, advertising affects the flagship fund differently than the other funds. Sample firms appeared unable to choose correctly between print and TV ads.     

The social media faces of major global financial service brands

With the advent of social media, brand management has become not only more difficult, but also increasingly critical to the credibility and reputation of firms. Moreover, consumer-generated content and its rapid diffusion takes control over advertising-intended messages away from brand managers. Financial services brand managers will not fully be able to control the destinies of their brands, but at the very least they need to be involved in the conversations that speak about their brand. This article suggests a powerful analytical tool Chernoff Faces, which can add to financial service brand managers’ arsenal.     

The social media faces of major global financial service brands

With the advent of social media, brand management has become not only more difficult, but also increasingly critical to the credibility and reputation of firms. Moreover, consumer-generated content and its rapid diffusion takes control over advertising-intended messages away from brand managers. Financial services brand managers will not fully be able to control the destinies of their brands, but at the very least they need to be involved in the conversations that speak about their brand. This article suggests a powerful analytical tool Chernoff Faces, which can add to financial service brand managers’ arsenal.     

Managing customer expectations in financial services: Opportunities and challenges

Although studies have been conducted to advance our understanding of the concept of expectations, a number of challenges have been created in relation to the nature, types and dynamics of these expectations, and the effects of expectations on subsequent evaluations, both of which need closer attention. The objectives of this paper are to examine these challenges in the context of financial services, and discuss how financial service providers can manage customer expectations to their advantage. A set of propositions is developed, and suggestions for future research are also discussed.     

Effective marketing for professional services

In many professions, the idea of marketing has traditionally been not only foreign but distasteful. After all, what doctor, lawyer, architect, or consultant worth his or her salt would even need to go out hustling business? While this view still holds considerable weight in many people's minds, it is gradually receding before the forces of economic reality. As more professions become overcrowded, competition for customers is sharpening. How should professionals go about drawing favorable attention to themselves? By first recognizing the special problems they face in marketing their services, argues the author. Among the obstacles he identifies are buyer uncertainty about obtaining professional services, the difficulties of distinguishing among firms, and the immeasurable benefits of advertising. Among his suggestions are that providers of these services concentrate on educating prospective customers about the opportunities and limitations of the services, team up with others who have desirable experience, and do marketing research to identify and then cater to customer desires.     

Getting the most out of advertising and promotion

Until recently, believing in the effectiveness of advertising and promotion was largely a matter of faith. Despite all the data collected by marketing departments, none measured what was really important: the incremental sales of a product over and above those that would happen without the advertising and promotion. Thanks to a qualitatively new kind of marketing data, that situation is changing. "Single source" data correlate information on actual consumer purchases (available from universal-product-code scanners used in supermarkets and drug-stores) with information on the corresponding television advertising those consumers receive or on the promotion events they see. This allows managers to measure the incremental impact of advertising and promotion and to improve marketing productivity. To take advantage of the new single-source data, however, managers have to throw out much of the conventional wisdom about advertising and promotion that has grown up over the years. They must learn how to evaluate marketing differently by continually examining the appropriate balance between advertising and promotion. They must also train their sales force to do a different and extremely important job: to demonstrate to retailers the consumer pull of the company's advertising and promotion programs, as well as the effect of these programs on retailer profitability.     

DEVOLUTION, ACCRUALS ACCOUNTING AND ASSET MANAGEMENT IN NHS WALES

This paper describes how a strategy for health services has been developed for NHS Wales and examines the role of accruals accounting in asset management and development. It uses archival investigation as well as interviews and a questionnaire. The role of accruals accounting in the operation of the service, particularly as it relates to the capital asset base of the Trusts and how these are managed, is discussed in the context that Trusts are autonomous units that develop services, and hence their capital asset base, through their own internal planning structure. It is found that, on devolution, there was a lack of consistent information about the stock of capital assets and that capital charges, based on accruals accounting, were not penetrating asset management within individual Trusts. Although strategies were being developed centrally, their implementation at a Trust level can be impeded as a consequence of accruals accounting.     

Product market advertising and new equity issues

We analyze the interaction between a firm's product market advertising and its corporate financing decisions. We consider a firm that faces asymmetric information in both the product and financial markets and that needs to raise external financing to fund its growth opportunity (new project). Any product market advertising undertaken by the firm is visible to the financial market as well. In equilibrium, the firm uses a combination of product market advertising, equity underpricing, and underfinancing (raising a smaller amount of external capital than the full information optimum) to convey its true product quality and the intrinsic value of its projects to consumers and investors. The following two predictions arise from our theoretical analysis for the relation between product market advertising and equity underpricing around new equity issues. First, firms choose a higher level of product market advertising when they are planning to issue new equity, compared with situations in which they have no immediate plans to do so. Second, product market advertising and equity underpricing are substitutes for a firm issuing new equity. We empirically test the above two predictions and find supporting evidence in the context of firms making initial public offerings and seasoned equity offerings.     

The effects of advertising and solicitation on audit fees

Leading academic and professional accountants have suggested that the crisis in auditing over the past few years may have had its origin in deregulation which allowed firms to advertise their services and solicit new clients, encouraging accounting firms to become more commercial. In this paper, we look at this issue in New Zealand which has the unique distinction of having separated two key forms of deregulation, namely advertising and solicitation, by 6 years. This allows us to separately examine the effect of each form of market competition on audit fees. We find that advertising is associated with increases in fees, not decreases, which suggests that quality-based advertising took place, and not price-based advertising. In contrast, solicitation corresponded with a general decrease in average fees for clients of the Big 8. We interpret this result as indicating an increase in competition among accounting firms. Our results suggest that there may be a much more complex relationship among market competition, advertising and solicitation, and fees than the arguments used to originally justify deregulation.     

Integration and search engine bias

We study the effects of integration between a search engine and a publisher. In a model in which the search engine (i) allocates users across publishers and (ii) competes with publishers to attract advertisers, we find that the search engine is biased against publishers that display many ads – even without integration. Integration can (but need not) lead to own‐content bias. It can also benefit consumers by reducing the nuisance costs due to excessive advertising. Advertisers are more likely to suffer from integration than consumers. On net, the welfare effects of integration are ambiguous.     

THE ROLE OF ACCOUNTING IN ORGANISATIONAL CHANGE: PROMOTING PERFORMANCE IMPROVEMENTS IN THE PRIVATISED UK WATER INDUSTRY

Privatisation has been one of the most important and controversial policy initiatives to emerge in the U.K. over the last decade. Yet despite its prominence, little so far is known about its impact on those centrally involved in its implementations: senior management. This paper will investigate the ways in which senior management within one of the major privatised industries, the Water Industry, have sought to give effect to the strategic change involved in the transformation of a public sector Water Authority into a private sector Water plc. Although the monopoly character of the supply of Water services has remained intact, managers in the new Water plcs have had to respond to new expectations and assessments of corporate performance from shareholders, investors and financial analysts; from customers; and from a new economic regulatory regime operated by the Director General of the Office of Water Services. The Director General, in addition to operating price controls, is committed to developing “yardstick” competition which will provide the opportunity to make comparative judgements about performance levels achieved by each of the new Water plcs. In pursuit of improvements in efficiency and profitability, senior managers have engineered a variety of restructurings of corporate organisation to give more focus to achieving new business objectives, and to move away from a public sector bureaucratic management style with its traditional tall-pyramid structure to flatter and less hierarchical management structures. Although many of the changes have been justified in terms of empowerment and providing more autonomy for local managers, the paper argues that the experience of change for these managers has largely consisted of being subjected to much greater accountability for their performance through greater emphasis on the achievement of financial targets, more systematic monitoring of performance, the introduction of individual performance appraisal, and performance-related pay. Central to this intensification of the scrutiny of performance have been changes in accounting information systems and how they are used. In examining how these changes have functioned in their organisational context, the paper seeks to contribute to an understanding of the role of accounting in processes of organisational change     

What becomes an icon most?

Some brands become icons. Think of Nike, Apple, Harley-Davidson: They're the brands every marketer regards with awe. But they are not built according to the principles of conventional marketing, says Harvard Business School marketing professor Douglas Holt. Iconic brands beat the competition not just by delivering innovative benefits, services, or technologies but by forging a deep connection with the culture. A brand becomes an icon when it offers a compelling myth, a story that can help people resolve tensions in their lives. The deepest source of tension in modern society is the disparity between national ideology and the average citizen's reality. When ideologies shift, myths become even more important, and in America, the most potent myths are depictions of rebels. Mountain Dew has long offered a rebel myth in ads showing exciting, vital men who are far from the ideological model of success. Loyal customers drink the beverage to consume the myth. But Mountain Dew's greatest achievement is that it has retained its iconic power by creating fresh rebel myths to suit the tensions of each era: first the hillbilly, who stood in stark contrast to the organization man of the 1950s and 1960s; then the redneck, who rebelled against the investment bankers and consultants of the 1970s and 1980s; and most recently the slacker, who rejects the values and behaviors that, for the past decade, have marked the successful executive. Holt says marketers can learn from Mountain Dew and other iconic brands if they are willing to move beyond conventional brand management and acquire knowledge and skills they may not have. They must learn to target national contradictions instead of just consumer segments, create myths that make sense of confusing societal changes, and speak with a rebel's voice.     

Advertising as a search deterrent

This article examines a monopoly firm's incentive to disclose information through advertising when consumers can choose between buying immediately and searching for additional information. Because sales drop when search reveals low match values to consumers, the firm has an incentive to deter search. We show that partial information disclosure emerges as a useful tool for search deterrence when search costs are low. Informative advertising and consumer search can be viewed as complements in producing information. Although transparency policies reduce search expenditures and improve purchase decisions, whether they are socially desirable depends on the magnitude of search costs.