Consistency and commonality in advertising content: Helping or Hurting?

Scholars and practitioners widely argue that strong, successful brands are built on consistent and unique positioning, which should be reflected in the brands’ advertising. Surprisingly, however, little empirical evidence supports this claim, especially with regard to advertising content. The authors investigate whether and to what extent brands’ advertising content consistency—the similarity in the firm’s own advertising content over time—and commonality—the similarity between the firm’s and competitors’ advertising content—affect brands’ sales. Insights emerge from the analysis of the impact on sales of the content of 247 television ads aired by 33 brands in six consumer packaged goods categories over a four-year period. Results indicate that more than advertising spending, both consistency and commonality in advertising content affect sales, especially with respect to long-term cumulative sales. However, brands differ considerably regarding the direction of the effects. While small brands tend to benefit from increased consistency and commonality in advertising content, large brands tend to suffer from increased consistency. Thus, whether consistency and commonality in advertising content will help or hurt depends on the size of the brand.     

Co-ethnic markets: Financial penalty or opportunity?

This paper applies the view of resource based theory to minority entrepreneurship. It examines minority entrepreneurs’ reliance on co-ethnic markets in terms of the impact this has on the financial performance of their firms. This research focuses on three minority groups in particular: African Americans, Korean Americans and Mexican Americans. Findings indicate that owner's age and marital status, but not business age, shape the extent to which a business owner relies on co-ethnic clients. Furthermore, Korean American owned firms are less likely to have high proportions of co-ethnic clients compared to Mexican- and African American owned firms. Having a large co-ethnic clientele results in a financial penalty in terms of the revenue an owner draws from his or her business. This penalty occurs in businesses owned by all three groups of entrepreneurs. Findings lend support to the resource based theory view of the firm in terms of the need to dynamically apply resources in order to achieve a competitive advantage. Implications for theory and practice are discussed.     

Decision augmentation and automation with artificial intelligence: Threat or opportunity for managers?

Artificial intelligence (AI) has emerged as a promising and increasingly available technology for managerial decision-making. With the adoption of AI-enabled software, organizations can leverage various benefits of the technology, but they also have to consider the intended and unintended consequences of using the technology for managerial roles. It is still unclear whether managers will benefit from enhancing their abilities with AI-enabled software or become powerless puppets that do more than announce AI-enabled software results. Our research has revealed distinct ways in which organizations can use AI-enabled decision-making solutions: as tools or novelties, for decision augmentation or automation, and as either a voluntary or a mandatory option. In this article, we discuss the implications of each of these combinations on the relevant managers. We consider outcomes related to managerial job design and derive practical advice for organizational designers and managers who work with AI. Our outcomes provide guidance on how to deal with the conflict-riddled relationship between managers and technology with regard to capabilities, responsibilities, and acceptance of AI-enabled software.     

Rethinking the boundaries of social marketing: Activism or advertising?

In some areas of public health concern, corporate marketing activities may negate social marketing messages targeting individuals. Traditional social marketing campaigns may be ineffective when commercial marketing activities create an environment that encourages and maintains unhealthy behaviors. This article explores the role of social marketing in these instances.     

When should entrepreneurs expedite or delay opportunity exploitation?

We theorize on the performance implications of the timing at which entrepreneurs stop exploring their business opportunities and start exploiting them. Using an optimal-stopping approach, we characterize the time when exploitation should begin based primarily on when an entrepreneur's ignorance has been sufficiently reduced through knowledge accumulation. This “ignorance threshold” captures a tradeoff between the time needed to increase legitimacy and the necessity to act now to minimize competition. Changes in legitimacy and competition are based on how entrepreneurs manage their knowledge (tacit versus explicit) under differing degrees of novelty for the business opportunity. These changes, in turn, impact the performance and timing of opportunity exploitation.     

Consumer perceptions of carbon labeling in print advertising: Hype or effective communication strategy?

Eco-labels are being used more frequently in the marketplace. Recently, carbon-neutral labels have emerged on product packaging and advertisements as a popular form of eco-label. How consumers view these specific labels is of both conceptual and practical interest. Therefore, in a mixed-experimental design building on congruity theory and Deighton's two-step model of advertising effectiveness, the authors examine how consumers view the credibility and environmental concern of companies who use these labels, as well as their resulting purchase intentions. A 2(product) × 2(label) × 3(information) mixed design was used to examine consumer perceptions and behavior intentions. Product category (environmentally neutral vs. environmentally harmful) was a within-subjects factor; the presence/absence of the carbon-neutral label and information (positive/negative/control) was both manipulated between-subjects factors. Results show that the presence of a carbon-neutral label in an advertisement, regardless of the type of product, leads to more favorable perceptions of company environmental concern. However, there is a more pronounced increase in consumer perceptions of company environmental concern for an environmentally harmful product than for an environmentally neutral product.     

An integrative framework of cooperative advertising: Should manufacturers continuously support retailer advertising?

A two-period game is developed in a bilateral monopoly where, besides pricing decisions, the retailer and manufacturer can set their advertising and cooperative advertising support rates for each period. It is demonstrated that, in addition to the established continuous cooperative advertising programs, in which the retailer advertises and the manufacturer supports retailer advertising in each period, two other advertising schedules are possible. First, the retailer advertises in each period, while the manufacturer only supports the second-period advertising. Second, whether or not the manufacturer provides a cooperative advertising program in the first period, the retailer only advertises in the second period and receives advertising support. The conditions under which each of these advertising arrangements is implemented are identified. In a continuous cooperative advertising schedule, the manufacturer may change his advertising support over time depending on the nature of the long-term effects of retailer advertising. The implications of these findings are discussed.     

Frontline employees׳ attitudes towards self-service technologies: Threats or opportunity for job performance?

Increasing diffusion of self-service technologies (SSTs) on the points of sale impacts on traditional retailing from several perspectives. For instance, SSTs have direct effect on front-line employees. Indeed, they may cause a potential reduction in personal contacts with clients, reduction of workers, modifying the job conditions and so on. To date, the effect of SSTs on the points of sale has been mainly investigated from a consumers׳ perspective, by mainly focusing on consumers׳ acceptance and usage of these systems. The aim of this paper is to make employees׳ point of view clearly emerge, through a qualitative approach focusing on the investigation of employees׳ perception of the consequences of these technologies on job performance. The content analysis based on exploratory in-depth interviews involves 250 frontline employees. Authors examine the success of technology from employee׳s standpoint by evaluating their attitude and considering the impact on their job performance perception. In this way, the analysis allows defining new variables which are not previously investigated, such as the perception of speed for task completion, which emerged as the most important factor for employees׳ self-evaluation. Hence, this study offers support for evaluating job performance considering the specific case of SSTs in the frontline employees as initial insights rather than definitive understandings.     

Synergy between R&D and advertising on shareholder value: Does firm size matter?

Using the hierarchical linear model, we examine whether R&D and advertising and their synergy influence firm value. We also investigate whether firm size moderates the market value effects of R&D, advertising, and the synergistic effect of R&D and advertising on firm value. We find that R&D and the synergy between R&D and advertising have significant positive effects on shareholder value. Moreover, we find that the effects of R&D and advertising are significantly higher in large firms than small firms, while the synergistic effect is significantly positive in small firms but not in large firms. These results offer important insight for executives on the implications of resource allocation on R&D and advertising expenditures to create firm value. Copyright © 2016 ASAC. Published by John Wiley & Sons, Ltd.     

Does advertising indicate product quality? Evidence from prelaunch and postlaunch advertising in the movie industry

Literature on the informative role of advertising indicates that advertising quantity can serve as an indicator of product quality. As product life cycles grow shorter, firms in many industries spend significant amounts on advertising during the prelaunch period to create large initial demand. Thus, the role of prelaunch advertising may differ from that of postlaunch advertising, and a proper understanding of these differences is important. This study provides an empirical investigation of whether advertising is a reliable indicator of quality before and after product launches, using the data from the movie industry. Analyses of 1078 movies released during 2003–2011 show that postlaunch advertising is a reliable quality indicator and increases revenues, whereas prelaunch advertising is not a reliable quality indicator, even if it leads to higher revenues.     

Investment in online advertising and return on sales: Does it pay to outsource the services to an advertising agency?

Abstract

The effect of investing in online advertising on a firm’s financial outcomes can depend on whether or not the development and implementation of advertising campaigns are managed by advertising agencies. Agencies may have experienced professionals or workload to perform these jobs, but the costs are greater. This paper aims to investigate the effects of investments in digital marketing on the financial outcome of a company’s services, comparing whether or not it is outsourced to advertising agencies. The secondary data relates to services advertised and marketed by a firm. We tested the possible moderating effect of outsourcing the service in the relationship between investment in online advertising (Google and Facebook) and return on sales (profit margin), by controlling the effect of covariates. Through four regression analyses, the results showed that outsourcing the service moderates the relationship. Specifically, the higher the amount of advertising investment, the more it pays to outsource the service to an advertising agency in order to generate greater profit margin. But with a low investment value, it does not pay to outsource. This study helps to identify situations in which it pays to outsource digital marketing services to an advertising agency.     

Effects of outdoor advertising: Does location matter?

The growth and success of outdoor advertising is in large part due to the medium's ability to reach an increasingly elusive and mobile consumer. However, this success has come with a price. Public pressure and regulation have begun to eliminate or curtail many outdoor advertising locations, leading practitioners to question the effectiveness of the remaining outdoor advertising sites. Using associative learning techniques, these studies investigate what effect, if any, the environment in which outdoor advertising appears has on the attitudes, beliefs, and purchase intent of the advertised brand. The results of four experiments presented here suggest that the background environment does not impact advertising effectiveness, and practitioner concern of such may be unfounded. © 2011 Wiley Periodicals, Inc.     

Contextual and Competitive Interference: Inhibition or Facilitation?

Existing literature has found two sources of advertising interference, competitive and contextual, that decrease the effectiveness of an ad in a cluttered environment. However, to date, the negative impact of competitive and contextual interference has been examined independently. This research explores advertising effectiveness when these sources exist concurrently. Contrary to the supposition concerning the additive effects of both sources of interference when simultaneously present, our findings indicate that viewing ads for the same product category with similar executional elements leads to the dissipation of interference effects (Study 1). Consistent with the process rationale, when a product-brand cue (versus a picture cue) is provided, this novel effect disappears (Study 2). The implications of these findings for advertising are highlighted in the discussion section.     

Globalization and Poverty: Oxymoron or New Possibilities?

We examine the occurrence of ethics- related terms in 10-K annual reports over 1994–2006 and offer empirical observations on the conceptual framework of Erhard et al. (Integrity: A Positive Model that Incorporates the Normative Phenomena of Morality, Ethics, and Legality (Harvard Business School, Harvard) 2007). We use a pre-Sarbanes-Oxley sample subset to compare the occurrence of ethics-related terms in our 10-K data with samples from other studies that consider virtue-related phenomena. We find that firms using ethics-related terms are more likely to be “sin” stocks, are more likely to be the object of class action lawsuits, and are more likely to score poorly on measures of corporate governance. The consistency of our results across these alternative measures of ethical behavior suggests that managers who portray their firm as “ethical” in 10-K reports are more likely to be systematically misleading the public. These results are consistent with the integrity-performance paradox.     

Job satisfaction and self-employment: autonomy or personality?

Most studies in the economics discourse argue that the impact of self-employment on job satisfaction is mediated by greater procedural freedom and autonomy. Values and personality traits are considered less likely to explain the utility difference between self-employed and salaried workers. Psychology scholars suggest that entrepreneurial satisfaction also depends, at least in part, on specific values and personality traits. Utilising a large dataset derived from the 2006 European Social Survey, this study performs a complementary analysis by taking personality traits, personal values and indicators for workers’ autonomy explicitly into account. The empirical findings add further strength to economists’ argument that, net of values and personality traits, autonomy and independence are the mechanisms by which self-employment leads to higher levels of job satisfaction. These results hold true for both male and female sub-samples even when a multitude of socio-demographic characteristics, personal values and personality traits are controlled for.     

Like or dislike? Adolescents’ responses to personalized social network site advertising

Increasingly, personal data posted by users of social network sites (SNSs) can be used to personalize advertising. The present study investigates how adolescents respond to personalized ads in terms of attitude toward the ad, brand engagement and intention to forward, and whether privacy concerns moderate their responses. According to pretest results, a medium level of personalization was expected to be optimal in terms of advertising effectiveness. A within-subjects experiment involving 40 participants aged 14–18 years was performed. Three conditions of personalized advertising were designed with, respectively, low, medium, and high levels of personalization. The study found that the highest personalization condition generated the most positive response and that privacy concerns did not moderate the effects of personalization. The privacy paradox is discussed as an alternative explanation, along with other implications of the results.