The Relation Between Earnings Management and Non‐GAAP Reporting

Managers have a variety of tools at their disposal to influence stakeholder perceptions. Earnings management and the strategic reporting of non‐GAAP earnings are just two of the available menu choices. We explore how real earnings management and accruals management influence the probability that a company will disclose a non‐GAAP adjusted earnings metric in its earnings press release and the likelihood that it will do so aggressively. We first investigate situations where managers already meet analysts’ expectations either based on strong operating performance or after employing real and accruals management. We find that when solid operating performance alone allows firms to meet expectations, managers do not employ earnings management or non‐GAAP reporting. However, when managers meet expectations using real and accruals management, they are significantly less likely to report a non‐GAAP earnings metric. Next, we explore scenarios where companies fall short of expectations. We find that when they just miss expectations after managing GAAP earnings, they are significantly more likely to employ non‐GAAP reporting, suggesting that the timing and relatively costless nature of non‐GAAP reporting allows managers to appear to meet expectations on a non‐GAAP basis when managed GAAP earnings fall short. Moreover, we find that companies are more likely to report non‐GAAP earnings (and to do so aggressively) when (i) they are unable to use real or accruals earnings management, (ii) are constrained by prior‐period accruals management, and (iii) their operating performance is poor. Taken together, our results are consistent with a substitute relation between non‐GAAP reporting and both real and accruals management.     

Explicating the ‘like’ on Facebook brand pages: The effect of intensity of Facebook use,number of overall ‘likes’, and number of friends' ‘likes’ on consumers' brand outcomes

This study examined the relationship between the number of overall ‘likes’ and friends' ‘likes’ on Facebook brand pages in influencing consumers' brand attitude, brand trust, brand involvement, and purchase intention, drawing upon theoretical concepts including diffusion of innovations, social capital theory, strength of weak ties, sociometric versus perceptual popularity, and prior research in online impression formation. Results of a 2 × 2 experiment revealed significant main effects of number of overall ‘likes’ and friends' ‘likes’ on key dependent measures. A significant interaction effect was also found between overall ‘likes’ and friends' ‘likes’. Additionally, intensity of Facebook use also mediated the relationships between number of overall ‘likes’ and friends' ‘likes’ with brand attitude, brand trust, and purchase intention.     

Rewards that undermine customer loyalty? A motivational approach to loyalty programs

Guided by the framework of self‐determination theory (SDT), this study examined the effects of external rewards on undermining customers’ intrinsic motivation to engage in a retail loyalty program. Two experiments revealed that participants who received a salient, controlling reward (i.e., a promise of reward with an explicit requirement and deadline, without options of choice) reported lower intrinsic motivation to use the loyalty program than participants who received a nonsalient, autonomy‐supportive reward (i.e., a promise of reward with a less explicit requirement and no deadline, with options of choice). However, the undermined intrinsic motivation of those who received the salient, controlling reward was enhanced when they were given verbal feedback acknowledging their potential negative feelings associated with using the loyalty program. These findings provide important practical implications for designing a more effective loyalty program.     

Multigeneration diffusion model for economic assessment of new technology

In the era of 21st century, development of emerging information technology is the essence of the advancement. This kind of new technology, however, often requires a great deal of amount of initial investment for both procedures of R&D and commercialization. As cost invested in developing the specified technology is increasing, investors are paying more attention to cost to benefit analysis (CBA). One of the basic elements of CBA for new technological development is the diffusion pattern of demand of such technology. Typically, it would be hard to presume the diffusion pattern of demand when the new product or the technology is under development. In this case, a simulation study is necessary. Many studies of technology evaluation have adopted a single generation model to simulate the diffusion pattern of demand. This approach, however, considers the diffusion of the new technology itself, not taking into account newer generation, which can replace the one just invented. In the real market situation, one must consider the competition and substitution phenomena between old and new technologies. In this paper, we show how multigeneration technology diffusion model can be applied for more accurate CBA for information technology. Additionally, Monte Carlo simulation is performed to find influential factors on the CBA of a cybernetic building system (CBS).     

Hedonic shopping motivation and co-shopper influence on utilitarian grocery shopping in superstores

Much prior literature has focused on how hedonic shopping motivation operates in hedonic shopping environments such as shopping malls, but few empirical studies have assessed hedonic shopping motivation effects in utilitarian shopping environments. Combining a field survey (Study 1) with observation using video ethnography (Study 2), our research addresses this issue. Our results empirically reveal how, through both psychological and behavioral routes, hedonic shopper motivation affects purchases in a utilitarian shopping environment, specifically a section of a superstore selling predominantly utilitarian products. Hedonic shopping motivation is found to induce consumer impulsiveness (psychological route) while also encouraging shoppers to stay longer in a store (behavioral route), which when combined result in greater consumer purchases than either route alone. Additionally we observe a moderating effect of co-shopper influences on these two routes. Implications of these findings are discussed.     

Trends in the use of statistics in major advertising journals over four decades

The use of statistical techniques in data-based articles appearing in the International Journal of Advertising, Journal of Advertising, Journal of Advertising Research and Journal of Current Issues & Research in Advertising was analysed over four decade intervals (i.e., 1980s, 1990s, 2000s and 2010s) and by journal. Among the trends, the study found: (1) nearly seven of every 10 journal articles reported statistical analyses (68.8% or 541 of 786); (2) the trend for statistically based articles was remarkably consistent over the time intervals and held true for the different advertising journals with one exception; (3) the use of different statistical techniques changed over time, with statistical techniques becoming more diverse and sophisticated through the years, but more so in some advertising journals than in others; (4) statistics were correctly applied in the majority of the research reports relative to ‘study purpose’; (5) the use of different statistical techniques varied by method of data collection generally and within articles appearing in three of the four journals; and (6) the presence or absence of hypotheses and/or research questions in the advertising studies was differentially associated with the application of different statistics. The inquiry serves to move advertising research forward in two ways: first, it documents how statistical analyses have changed over time and, second, it provides insight into where the field might be headed regarding the use of statistical techniques.     

Information and adjustment in a local housing market

Existing studies on bubbles have been mainly concerned with investigating the stationarity properties of stock prices and market fundamentals. We develop a new method of testing for bubbles that relates the bubble component of stock prices to the probability of bursting in the context of the Weibull distribution. There were several eruptions and subsequent collapses of seeming bubbles over the past three decades: 1987 (Black Monday), 2000 (information technology (IT) boom) and 2007 (housing market boom). Using US monthly data for the S&P 500 and NASDAQ series, we have found that the S&P 500 series contained an explosive bubble only during the boom of the housing market that occurred before the 2007 global economic crisis, and the NASDAQ market contained an explosive bubble during the surge of stock prices peaking in 1987 and 2007, although our stationarity tests fail to detect the bubbles. No bubble was found in both the S&P and NASDAQ series during the 2000 IT boom. Our evidence corroborates the criticism that the traditional unit root and cointegration tests may not be able to detect some important class of bubbles.     

New product pricing strategy under customer asymmetric anchoring

Potential customers' willingness to pay (WTP) for a new product can be affected by their observing a posted price and this can be modeled in terms of an anchoring mechanism. A theoretical argument and mathematical proof are developed, showing that if customers use an asymmetric WTP anchoring mechanism, it will normally be optimal for firms to price higher than otherwise. Experimental evidence is provided supporting the notion that an asymmetric anchoring mechanism can be involved in purchase decisions.     

Effective employment brand equity through sustainable competitive advantage, marketing strategy, and corporate image

Traditional human resource management does not consider adopting a marketing approach in creating a positive company image to enable the recruitment of better employees. Recently, however, many scholars have attempted to apply marketing principles to recruitment management. Marketing can help create an effective image for a firm and position the firm as a good place to work. The study here examine ways marketing management relates to recruitment marketing in the hospital industry and finds that a hospital's sustainable competitive advantage, marketing strategy, and employment brand equity can influence the intention of medical doctors to pursue job opportunities.