Important Determinants of Foreign Company Performance in China: Big Data Analysis

Abstract

Foreign market entry is important in market development. We examine entry timing/mode, investment, advertising, location, and interactive effects. Early entrants enjoy a high market share. The type of entry and initial investment also affect performance. Even though the effect of advertising on market share is significant, regardless of early/late entry, the effect is different, based on entry mode, investment, and industry. The effect of advertising is larger on owned subsidiaries. Nonmanufacturing firms benefit more from advertising compared to manufacturing firms. Multinationals in manufacturing industries investing in Middle/Northeast China perform better, while nonmanufacturing multinationals perform better in Eastern China.

Keywords:

• Performance
• entry timing/mode
• investment
• advertising