Marketing spending strategy in recessions

Gary L. Lilien, Raji Srinivasan

Research output: Contribution to journalArticle

9 Scopus citations

Abstract

Recessions provide challenges to managers seeking to develop and justify an appropriate level of market-facing activity. The literature on the topic offers limited guidance on what strategy is most appropriate. We briefly review the literature on the topic and report on recent results that show (a) that R&D spending by B2BGoods firms and B2BServices firms in recessions increases both profits and stock returns, while advertising spending decreases both profits and stock returns; (b) for B2CServices firms, both R&D and advertising spending in recessions increases profits and stock returns and (c) for B2CGoods firms, R&D spending in recessions increases profits and stock returns, while advertising spending increases profits but decreases stock returns. Further, these effects are either strengthened or weakened depending on the firm's market share and financial leverage.

Original languageEnglish (US)
Pages (from-to)181-182
Number of pages2
JournalAustralasian Marketing Journal
Volume18
Issue number3
DOIs
StatePublished - Aug 1 2010

All Science Journal Classification (ASJC) codes

  • Economics and Econometrics
  • Marketing

Fingerprint Dive into the research topics of 'Marketing spending strategy in recessions'. Together they form a unique fingerprint.

  • Cite this