Title
Investor sentiment and advertising expenditure
Source of Publication
International Journal of Research in Marketing
Abstract
© 2018 Elsevier B.V. A strategic issue facing marketing managers is ‘how much and when’ to spend on advertising. We argue that investor sentiment in the stock market may influence advertising expenditure by affecting firms’ ability to raise new funds. We show that during periods of low (high) investor sentiment, firms decrease (increase) their advertising expenditure, even though the effectiveness of advertising is greater (lower) during such periods. We also find that these results are stronger for financially constrained firms that rely more on external financing. Our findings suggest that marketing managers can improve the efficiency of their advertising expenditure by raising (reducing) it during periods of low (high) sentiment.
Document Type
Article
First Page
611
Last Page
627
Publication Date
12-1-2018
DOI
10.1016/j.ijresmar.2018.08.005
Recommended Citation
Mian, G. Mujtaba; Sharma, Piyush; and Gul, Ferdinand A., "Investor sentiment and advertising expenditure" (2018). Scopus Indexed Articles. 931.
https://zuscholars.zu.ac.ae/scopus-indexed-articles/931