Publication Type
Journal Article
Version
acceptedVersion
Publication Date
4-2012
Abstract
In response to recent calls to study factors that determine a retailer's stock price, this study draws on signaling theory to examine the impact of two key marketing metrics that are widely disclosed by retailers to investors, advertising spending and growth in same-store sales (COMPS), and highlights the moderating role of various firm- and sector-specific factors. Using a stock-response model estimated on a sample of 1,646 observations for 257 retailers, the authors find that the value relevance of advertising spending and COMPS depends on the financial condition of, and the competitive pressures faced by, the retailer. In addition, the positive effect of COMPS on stock returns is found to be stronger in the presence of decreases in advertising spending.
Keywords
Value relevance, Advertising spending, COMPS, Same store sales growth, Earnings, Leverage, Firm value
Discipline
Advertising and Promotion Management | Marketing
Research Areas
Marketing
Publication
Journal of Retailing
Volume
88
Issue
4
First Page
447
Last Page
461
ISSN
0022-4359
Identifier
10.1016/j.jretai.2012.07.001
Publisher
Elsevier
Citation
TULI, Kapil R.; MUKHERJEE, Anirban; and Dekimpe, Marnik.
On the value relevance of retailer advertising spending and same-store sales growth. (2012). Journal of Retailing. 88, (4), 447-461.
Available at: https://ink.library.smu.edu.sg/lkcsb_research/3485
Copyright Owner and License
Authors
Creative Commons License
This work is licensed under a Creative Commons Attribution-NonCommercial-No Derivative Works 4.0 International License.
Additional URL
https://doi.org/10.1509/jmkr.47.1.36