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dc.contributor.authorTackx, Koen
dc.contributor.authorRothenberger, Sandra
dc.contributor.authorVerdin, Paul
dc.date.accessioned2017-12-02T15:00:14Z
dc.date.available2017-12-02T15:00:14Z
dc.date.issued2017
dc.identifier.doi10.1016/j.emj.2016.07.008
dc.identifier.urihttp://hdl.handle.net/20.500.12127/5640
dc.description.abstractDoes advertising lead to higher profits? This question has preoccupied company executives and academic researchers for many decades. Arguments have been put forth in both directions, and evidence is mixed at best. In this article, we re-examine the question from a value creation and value capturing perspective, which allows us to re-interpret and reconcile the different views and empirically validate the resulting hypotheses. Using a database of the top 500 brands of established companies during the 2008-2015 period, we find that advertising spending has no significant impact on profitability, while both brand value and research and development (R&D) spending have a clearly positive effect. In addition, we observe a positive interaction effect between advertising spending and R&D spending and a negative interaction between brand value and R&D spending on profitability. These findings corroborate the view that advertising in and of itself does not improve profitability, rather, its effect is positive only when it acts in support of customer value creation as a result of R&D.
dc.language.isoen
dc.subjectAdvertising Effectiveness
dc.subjectBrand Value
dc.subjectResearch and Development
dc.subjectProfitability Drivers
dc.subjectValue Creation
dc.subjectValue Capturing
dc.titleIs advertising for losers? An empirical study from a value creation and value capturing perspective
dc.identifier.journalEuropean Management Journal
dc.source.volume35
dc.source.issue3
dc.source.beginpage327
dc.source.endpage335
vlerick.knowledgedomainSpecial Industries : Energy
vlerick.typearticleJournal article with impact factor
vlerick.vlerickdepartmentEGS
dc.identifier.vperid219045
dc.identifier.vperid107025
dc.identifier.vperid62369
dc.identifier.vpubid6936


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