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Article Dans Une Revue British Journal of Management Année : 2021

Does Advertising Productivity Affect Organizational Performance? Impact of Market Conditions

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Mahabubur Rahman
Mathew Hughes

Résumé

Advertising is crucial in influencing customers’ perceptions and purchase intentions, and numerous studies have investigated whether advertising expenditure has any significant impact on financial performance. A thorough understanding remains elusive: while several studies document a positive impact, others report that advertising has either a negative or a statistically insignificant effect. Three flaws among existing studies are responsible for this problem: bundling advertising with other forms of marketing, the inadequacy of expenditure as a measure and a failure to consider contingencies. Deviating from earlier studies, we examine the effect of advertising productivity on firm performance rather than the impact of the absolute amount of advertising expenditure. Moreover, adopting a contingency approach, we evaluate how market conditions of market dynamism, market complexity and market munificence moderate the relationship between advertising productivity and organizational performance. Drawing a multi-industry sample from the USA, this study demonstrates that advertising productivity has a positive impact on capital market-based performance measures, conditional on market conditions. We reveal new insights into when, why and to what extent advertising contributes (or not) to organizations’ financial performance.
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Dates et versions

hal-03419361 , version 1 (08-11-2021)

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Citer

Mahabubur Rahman, M. Ángeles Rodríguez‐serrano, Mathew Hughes. Does Advertising Productivity Affect Organizational Performance? Impact of Market Conditions. British Journal of Management, 2021, 32 (4), pp.1359-1383. ⟨10.1111/1467-8551.12432⟩. ⟨hal-03419361⟩
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