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Marketing firm performance: When does marketing lead to financial gains?

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  • Rafael Barreiros Porto
  • Gordon Robert Foxall

Abstract

The research investigated whether economic context and prior financial reinforcement/punishment moderate the effectiveness of marketing behavior in generating gains for the firm. An experiment with a longitudinal design was conducted using 1,759 companies from 2000 to 2017. The results demonstrate that marketing is effective in gaining market share when the country's economy is growing. In contrast, it increases return on assets and Tobin's Q when the country's economy is in recession, this increase being maximized when the company was financially reinforced. The study helps explain the circumstances in which marketing activities boost firms' financial gains.

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  • Rafael Barreiros Porto & Gordon Robert Foxall, 2020. "Marketing firm performance: When does marketing lead to financial gains?," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 41(2), pages 191-202, March.
    • Handle: RePEc:wly:mgtdec:v:41:y:2020:i:2:p:191-202
    DOI: 10.1002/mde.3046
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    Cited by:

    1. Eirik Sjåholm Knudsen & Lasse B. Lien & Bram Timmermans & Robert Wuebker, 2022. "The more things change, the more they stay the same: Demand‐side responses to economic shocks," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 43(5), pages 1240-1255, July.
    2. Rafael Barreiros Porto & Gordon Robert Foxall, 2022. "The marketing‐finance interface and national well‐being: An operant behavioral economics analysis," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 43(7), pages 2941-2954, October.

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