Advertising and Word-of-Mouth Effects on Pre-launch Consumer Interest and Initial Sales of Experience Products

This study examines how consumers' interest in a new experience product develops as a result of advertising and word-of-mouth activities during the pre-launch period. The empirical settings are the U.S. motion picture and video game industries. The focal variables include weekly ad spend, blog volume, online search volume during pre-launch periods, opening-week sales, and product characteristics. We treat pre-launch search volume of keywords as a measure of pre-launch consumer interest in the related product. To identify probable persistent effects among the pre-launch time-series variables, we apply a vector autoregressive modeling approach. We find that blog postings have permanent, trend-setting effects on pre-launch consumer interest in a new product, while advertising has only temporary effects. In the U.S. motion picture industry, the four-week cumulative elasticity of pre-launch consumer interest is 0.187 to advertising and 0.635 to blog postings. In the U.S. video game industry, the elasticities are 0.093 and 1.306, respectively. We also find long-run co-evolution between blog and search volume, which suggests that consumers' interest in the upcoming product cannot grow without bounds for a given level of blog volume

Marketing and Data Science: Together the Future is Ours

The synergistic use of computer science and marketing science techniques offers the best avenue for knowledge development and improved applications. A broad area of complementarity between the typical focus in statistics and computer science and that in marketing offers great potential. The former fields tend to focus on pattern recognition, control and prediction. Many marketing analyses embrace these directions, but also contribute by modeling structure and exploring causal relationships. Marketing has successfully combined foci from management science with foci from psychology and economics. These fields complement each other because they enable a broad spectrum of scientific approaches. Combined, they provide both understanding and practical solutions to important and relevant managerial marketing problems, and marketing science is already very successful at obtaining unique insights from big data

Impact of acquisition channels on customer equity, The

Customer equity (CE henceforth) is a powerful new paradigm to evaluate the firm's value and to optimally allocate marketing resources. This paper is focused on the relationship between customer acquisition and CE. The authors attempt to answer the following four questions: 1) how should customer acquisition channels be categorized to make them meaningful to managers and academics?; 2) how do we measure the effects of different acquisition channels on the firm's performance?; 3) how do we disentangle short-run effect and long-run effects?, and 4) how should the manager allocate a limited budget among the acquisition channels so as to maximize customer equity? The authors first propose a way of categorizing customer acquisition channels according to their level of contact and intrusiveness. A vector-autoregressive (VAR) model is used to examine the dynamics of acquisition channels and the firm's performance, and an empirical illustration on a surviving Internet company is provided. The results show that each cohort (i.e., customers from different acquisition channels) has different short-run and long-run effects on the firm's performance by the subsequent login and purchasing behavior. Building on previous research on optimal resource allocation, the authors develop a Marketing Decision Support System (MDSS) to help managers allocate the acquisition budget among different channels with the objective of maximizing customer equity. The consequences of naively maximizing the short-term profit and not accounting for differences in the margin contribution of different cohorts are illustrated.customer equity; customer acquisition; VAR; long-run modeling;

The Direct and Indirect Effects of Advertising Spending on Firm Value

Marketing decision makers are increasingly aware of the importance of shareholder value maximization, which calls for an evaluation of the long-term effects of their actions on product-market response and investor response. However, the marketing literature to date has focused on the sales or profit response of marketing actions, and the goals of marketing have traditionally been formulated from a customer perspective. Recently, there have been a few studies of the long-term investor response to marketing actions. The current research investigates one important aspect of this impact, the long-term relationship between advertising spending and market capitalization. The authors hypothesize that advertising can have a direct effect on valuation (i.e., an effect beyond its indirect effect through sales revenue and profit response). The empirical results across two industries provide support for the hypothesis that advertising spending has a positive, long-term impact on own firms\u27 market capitalization and may have a negative impact on the valuation of a competitor of comparable size. The authors quantify the magnitude of this investor response effect for and discuss its implications for further research

The evolution of debt policies: New evidence from business startups

This is the author accepted manuscript. The final version is available from the publisher via the DOI in this recordWe investigate the evolution of entrepreneurial firms' debt policies over a period of 15 years after startup, considering leverage, debt specialization, debt maturity and debt granularity. Our analysis is based on a unique sample covering all non-financial Belgian firms founded between 1996 and 1998. We find that the debt policy of entrepreneurial firms is remarkably stable over time. The debt policy in the initial year of operation is a very important determinant of future debt policies, even after controlling for traditional contemporaneous determinants. The founder-CEO has an important impact on the stability of debt policies: the influence of initial debt policies on future debt policies is significantly reduced when the founder-CEO is replaced or when (s)he dies. Combined, our findings support imprinting theory.Hercules FundNational Bank of BelgiumGhent University Special Research Fun

Brand performance volatility from marketing spending

© Copyright 2016, INFORMS. Although volatile marketing spending, as opposed to even-level spending, may improve a brand's financial performance, it can also increase the volatility of performance, which is not a desirable outcome. This article analyzes how revenue and cash-flow volatility are influenced by own and competitive marketing spending volatility, by the level of marketing spending, by the responsiveness to own marketing spending, and by competitive response. From market response theory, we derive propositions about the influence of these variables on revenue and cash-flow volatility. In addition, we extend the Dorfman-Steiner theorem to derive the optimal level and volatility of expenditures if volatility effects are taken into account. Based on a large sample of 99 pharmaceutical brands in four clinical categories and four European countries, we test for the empirical relevance of the propositions and assess the magnitude of the different sources of marketing-induced performance volatility. We find broad support for the predicted volatility effects. Volatility elasticities are significant and may be as large as 1.10 for cash-flow variance with respect to marketing responsiveness. The findings imply that common volatility-increasing marketing practices such as price promotions or volatile advertising plans may be effective at the top line, but they could turn out to be ineffective after all costs are taken into account. Optimal marketing volatility needs to trade off sales effectiveness and extra costs resulting from marketing volatility

The Relationship Between Fermented Foods and Depression: A Systematic Review

Depression is a global health issue that is socially and economically expensive. The gut microbiome influences depression, and fermented foods contain bacteria that contribute to the ecology of the gut microbiome. We performed a systematic review of clinical research that examines the relationship between fermented food and depression by conducting an electronic search of four academic databases using the search terms fermented, fermented foods, fermentation, and depression. The inclusion criteria are: inpatient, outpatient, and community settings; human participants age 5-110 years old; any diagnosis of depression; daily ingestion of fermented foods regardless of ingredients; written in English; published full text articles accessible through St. Catherine University; random controlled trials, case reports, cross-sectional studies, cohort studies, and clinical trials; and any measured change in depression after daily ingestion of fermented food. We identified 64 articles, and only two met the inclusion criteria. Both studies indicate a positive trend between fermented food supplementation and improvement in depression. Results are presented in a narrative synthesis, however, there were too few studies to draw major or significant conclusions. Researching multifaceted issues including the gut microbiome and depression in a reductive manner is paradoxical and inadequate. We suggest a more holistic approach with epistemological and ontological assumptions that account for the complexities and synergies in the human body

Nationwide population-based cohort study of uterine rupture in Belgium : results from the Belgian Obstetric Surveillance System

Objectives: We aimed to assess the prevalence of uterine rupture in Belgium and to evaluate risk factors, management and outcomes for mother and child. Design: Nationwide population-based prospective cohort study. Setting: Emergency obstetric care. Participation of 97% of maternity units covering 98.6% of the deliveries in Belgium. Participants: All women with uterine rupture in Belgium between January 2012 and December 2013. 8 women were excluded because data collection forms were not returned. Results: Data on 90 cases of confirmed uterine rupture were obtained, of which 73 had a previous Caesarean section (CS), representing an estimated prevalence of 3.6 (95% CI 2.9 to 4.4) per 10000 deliveries overall and of 27 (95% CI 21 to 33) and 0.7 (95% CI 0.4 to 1.2) per 10000 deliveries in women with and without previous CS, respectively. Rupture occurred during trial of labour after caesarean section (TOLAC) in 57 women (81.4%, 95% CI 68% to 88%), with a high rate of augmented (38.5%) and induced (29.8%) labour. All patients who underwent induction of labour had an unfavourable cervix at start of induction (Bishop Score 7 in 100%). Other uterine surgery was reported in the history of 22 cases (24%, 95% CI 17% to 34%), including 1 case of myomectomy, 3 cases of salpingectomy and 2 cases of hysteroscopic resection of a uterine septum. 14 cases ruptured in the absence of labour (15.6%, 95% CI 9.5% to 24.7%). No mothers died; 8 required hysterectomy (8.9%, 95% CI 4.6% to 16.6%). There were 10 perinatal deaths (perinatal mortality rate 117/1000 births, 95% CI 60 to 203) and perinatal asphyxia was observed in 29 infants (34.5%, 95% CI 25.2% to 45.1%). Conclusions: The prevalence of uterine rupture in Belgium is similar to that in other Western countries. There is scope for improvement through the implementation of nationally adopted guidelines on TOLAC, to prevent use of unsafe procedures, and thereby reduce avoidable morbidity and mortality