ORCID Identifiers

0000-0002-6953-3652

Document Type

Article

Source of Publication

International Journal of Research in Marketing

Publication Date

12-1-2018

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.

ISSN

0167-8116

Publisher

Elsevier B.V.

Volume

35

Issue

4

First Page

611

Last Page

627

Disciplines

Business

Keywords

Advertising effectiveness, Advertising expenditure, Affordability method, Investor sentiment, Marketing expenditure, Stock market

Scopus ID

85053704463

Creative Commons License

Creative Commons Attribution 4.0 License
This work is licensed under a Creative Commons Attribution 4.0 License.

Indexed in Scopus

yes

Open Access

yes

Open Access Type

Green: A manuscript of this publication is openly available in a repository

Included in

Business Commons

Share

COinS