441
Views
4
CrossRef citations to date
0
Altmetric
Articles

Advertising Contribution to a Firm's Profit: Theory and Evidence from the Airline Industry in the United States

Pages 209-235 | Published online: 10 May 2012

REFERENCES

  • Aigner , D. , Lovell , K. and Schmidt , P. 1977 . Formulation and estimation of stochastic frontier production function models . Journal of Econometrics , 6 : 21 – 37 .
  • Agrawal , J. and Kamakura , W. A. 1995 . The economic worth of celebrity endorsers: An event study analysis . Journal of Marketing , 59 ( July ) : 56 – 62 .
  • Amit , R. and Schoemaker , P. J. H. 1993 . Strategic assets and organizational rent . Strategic Management Journal , 14 : 33 – 46 .
  • Anand , J. and Delios , A. 2002 . Absolute and relative resources as determinants of international acquisitions . Strategic Management Journal , 23 : 119 – 134 .
  • Anderson , E. W. , Fornell , C. and Mazvancheryl , S. K. 2004 . Customer satisfaction and shareholder value . Journal of Marketing , 68 ( October ) : 172 – 185 .
  • Assmus , G. , Farley , J. U. and Lehmann , D. R. 1984 . How advertising affects sales: Meta-analysis of econometric results . Journal of Marketing Research , 21 ( February ) : 65 – 74 .
  • Baer , J. 2008, February 19 . Deals in the air: Rising costs force US carriers to seek mergers . Financial Times , : 9
  • Barney , J. B. 1986 . Strategic factor markets: Expectations, luck, and business strategy . Management Science , 32 : 1231 – 1241 .
  • Barney , J. B. 1991 . Firm resources and sustained competitive advantage . Journal of Management , 17 ( 1 ) : 99 – 120 .
  • Bayus , B. L. , Jain , S. and Rao , A. G. 1997, (February) . Too little, too early: Introduction timing and new product performance in the personal digital assistant Industry . Journal of Marketing Research , 34 : 50 – 63 .
  • Belch , G. E. and Michael , Belch . 2009 . Advertising and promotion: An integrated marketing communications perspective , 8th ed. , New York , NY : McGraw Hill .
  • Bharadwaj , A. S. , Bharadwaj , S. G. and Konsynski , B. R. 1999 . Information technology effects on firm performance as measured by Tobin's q . Management Science , 45 ( 6 ) : 1008 – 1024 .
  • Bhargava , M. , Donthu , N. and Caron , R. 1994 . Improve the effectiveness of outdoor advertising: Lessons from a study of 282 campaigns . Journal of Advertising Research , 34 ( 2 ) : 46 – 55 .
  • Biggadike , E. R. 1976 . “ Corporate diversification: Entry strategy and performance ” . Cambridge , MA : Harvard University Press .
  • Bohlmann , J. D. , Golder , P. N. and Mitra , D. 2002 . Deconstructing the pioneer's advantage: Examining vintage effects and consumer valuations of quality and variety . Management Science , 48 ( 9 ) : 1175 – 1195 .
  • Boulding , W. and Christen , M. 2003 . Sustainable pioneering advantage? Profit implications of market entry order . Marketing Science , 22 ( 3 ) : 371 – 392 .
  • Bowman , D. and Gatignon , H. 1996 . Order of entry as a moderator of the effect of the marketing mix on market share . Marketing Science , 15 ( 3 ) : 222 – 242 .
  • Brown , C. L. and Lattin , J. M. 1994 . Investigating the relationship between time in market and pioneering advantage . Management Science , 40 : 1361 – 1369 .
  • Brush , T. H. and Artz , K. W. 1999 . Toward a contingent resource-based theory: The impact of information asymmetry on the value of capabilities in veterinary medicine . Strategic Management Journal , 20 : 223 – 250 .
  • Buschken , J. 2007 . Determinants of brand advertising efficiency, evidence from the German car market . Journal of Advertising , 36 ( 3 ) : 51 – 73 .
  • Capron , L. and Hulland , J. 1999 . Redeployment of brands, sales forces, and general marketing management expertise following horizontal acquisitions: A resource-based view . Journal of Marketing , 63 ( April ) : 41 – 54 .
  • Carey , S. and McCartney , S. 2004, October 5 . How airlines resisted change for 25 years, and finally lost . Wall Street Journal , : A1
  • Carpenter , G. S. and Nakamoto , K. 1989 . Consumer preference formation and pioneering advantage . Journal of Marketing Research , 26 ( August ) : 285 – 298 .
  • Collis , D. J. and Montgomery , C. A. 1995 . Competing on resources: Strategy in the 1990s . Harvard Business Review , 73 ( 4 ) : 118 – 128 .
  • Cowles , D. L. , Kiecker , P. and Little , M. W. 2002 . Using key informant insights as a foundation for e-tailing theory development . Journal of Business Research , 55 : 629 – 636 .
  • Datar , S. , Jordan , C. C. , Kekre , S. , Rajiv , S. and Srinivasan , K. 1997 . Advantages of time-based new product development in a fast-cycle industry . Journal of Marketing Research , 34 ( February ) : 36 – 49 .
  • Deighton , J. , Henderson , C. M. and Neslin , S. A. 1994 . The effect of advertising on brand switching and repeat purchasing . Journal of Advertising Research , 31 ( February ) : 28 – 43 .
  • Dillon , W. R. , Calantone , R. and Worthing , P. 1979 . The new product problem: An approach for investigating product failures . Management Science , 25 ( December ) : 1184 – 1196 .
  • Dutta , S. , Narasimhan , O. and Rajiv , S. 1999 . Success in high-technology markets: Is marketing capability critical? . Marketing Science , 18 ( 4 ) : 547 – 568 .
  • Eisenhardt , K. M. and Martin , J. A. 2000 . Dynamic capabilities: What are they? . Strategic Management Journal , 21 : 1105 – 1121 .
  • Fershtman , C. , Mahajan , V. and Muller , E. 1990 . Market share pioneering advantage: A theoretical approach . Management Science , 36 : 900 – 918 .
  • Geyskens , I. , Gielens , K. and Dekimpe , M. G. 2002 . The market valuation of internet channel additions . Journal of Marketing , 66 ( April ) : 102 – 119 .
  • Hawawini , G. , Subramanian , V. and Verdin , P. 2003 . Is performance driven by industry- or firm-specific factors? A new look at the evidence . Strategic Management Journal , 24 ( 10 ) : 1 – 16 .
  • Helfat , C. 1997 . Know-how and asset complementarity and dynamic capability accumulation: The case of R&D . Strategic Management Journal , 18 ( 5 ) : 339 – 360 .
  • Huff , L. C. and Robinson , W. T. 1994 . The impact of leadtime and years of competitive rivalry on pioneer market share advantages . Management Science , 40 : 1370 – 1377 .
  • International Aeronautic Federation . 1998, May . World airline performance , Geneva , , Switzerland : INTERAVIA .
  • International Aeronautic Federation . 2001, March . World airline performance , Geneva , , Switzerland : INTERAVIA .
  • Jeong , Y. and King , C. M. 2010 . Impacts of website context relevance on banner advertisement effectiveness . Journal of Promotion Management , 16 : 247 – 264 .
  • Kalyanaram , G. , Robinson , W. T. and Urban , G. L. 1995 . Order of market entry: Established empirical generalizations, emerging empirical generalizations, and future research, Part 2 of 2 . Management Science , 14 ( 3 ) : G212 – G221 .
  • Kerin , R. A. , Varadarajan , P. R. and Peterson , R. A. 1992 . First-mover advantage: A synthesis, conceptual framework, and research propositions . Journal of Marketing , 56 ( October ) : 33 – 52 .
  • King , A. A. and Tucci , C. L. 2002 . Incumbent entry into new market niches: The role of experience and managerial choice in the creation of dynamic capabilities . Management Science , 48 ( 2 ) : 171 – 186 .
  • Labich , K. and Woods , W. 1986, September 29 . Bob Crandall soars by flying solo . Fortune , 114 ( 7 ) : 118 – 122 .
  • Lee , H. , Smith , K. G. , Grimm , C. M. and Schomburg , A. 2000 . Timing, order and durability of new product advantages with imitation . Strategic Management Journal , 21 : 23 – 30 .
  • Lee , R. P. and Grewal , R. 2004 . Strategic responses to new technologies and their impact on firm performance . Journal of Marketing , 68 ( October ) : 157 – 171 .
  • Lieberman , M. B. and Montgomery , D. B. 1988 . First-mover advantage . Strategic Management Journal , 9 : 41 – 58 .
  • Lieberman , M. B. and Montgomery , D. B. 1998 . First-mover (dis)advantages: Retrospective and link with the resource-based view . Strategic Management Journal , 19 : 1111 – 1125 .
  • Lilien , G. L. , Kotler , P. and Moorthy , K. S. 1992 . Marketing models , Englewood Cliffs , NJ : Prentice-Hall .
  • Luo , X. and Donthu , N. 2001 . Benchmarking advertising efficiency . Journal of Advertising Research , 41 ( 6 ) : 7 – 18 .
  • Makadok , R. 1998 . Can first-mover and early-mover advantages be sustained in an industry with low barriers to entry/imitation? . Strategic Management Journal , 19 : 683 – 696 .
  • Makadok , R. and Walker , G. 2000 . Identifying a distinctive competence: Forecasting ability in the money fund industry . Strategic Management Journal , 21 : 853 – 864 .
  • McCartney , S. 2002a, August 13 . American Airlines will retrench in bid to beat discount carriers . Wall Street Journal , : A1
  • McCartney , S. 2002b, August 14 . The middle seat: Carriers discover that airlines with simplest operations win . Wall Street Journal , Retrieved from http://online.wsj.com/article/o,SB1029253560921908795.djm,00.html
  • McCartney , S. 2005, June 7 . The middle seat: Airports crack down on gamesmanship over gates; United Maintains presence despite drop-off in traffic, riling budget competitors . Wall Street Journal , : D4
  • McCartney , S. 2007, October 2 . The middle seat: For US Airways fliers, bigger isn't better . Wall Street Journal , : B11
  • McCartney , S. 2008, April 16 . The middle seat: What's in a merger? For fliers, not much . Wall Street Journal , : D1
  • McEvily , B. and Zaheer , A. 1999 . Bridging ties: A source of firm heterogeneity in competitive capabilities . Strategic Management Journal , 20 : 1133 – 1156 .
  • Moore , M. J. , Boulding , W. and Goodstein , R. C. 1991 . Pioneering and market share: Is entry time endogenous and does it matter? . Journal of Marketing Research , 28 : 97 – 104 .
  • Murray , A. 2007, February 21 . JetBlue: Now just another airline in a lousy business . Wall Street Journal , : A13
  • Narasimhan , C. and Zhang , Z J. 2000 . Market entry strategy under firm heterogeneity and asymmetric payoffs . Marketing Science , 19 ( 4 ) : 313 – 327 .
  • Nerlove , M. and Arrow , K. J. 1962 . Optimal advertising policy under dynamic conditions . Econometrica , 29 : 129 – 142 .
  • Nguyen , D. and Shi , L. 2006 . Competitive advertising strategies and market size dynamics: A research note on theory and evidence . Management Science , 52 ( 6 ) : 965 – 973 .
  • Perreault , W. D. Jr. , Cannon , J. P. and McCarthy , E J. 2009 . Basic marketing: A marketing strategy planning approach , 17th ed. , New York , NY : McGraw Hill .
  • Peteraf , M. A. 1993 . The cornerstones of competitive advantage: A resource-based view . Strategic Management Journal , 14 : 179 – 191 .
  • Prada , P. 2007, May 1 . Will investors board a revived Delta? . Wall Street Journal , : C1 – C3 .
  • Prescott , J. E. , Kohli , A. K. and Venkatraman , N. 1986 . The market share-profitability relationship: An empirical assessment of major assertions and contradictions . Strategic Management Journal , 7 ( 4 ) : 377 – 394 .
  • Robinson , W. T. 1988 . Sources of market pioneer advantages: The case of industrial goods industries . Journal of Marketing Research , 25 ( February ) : 87 – 94 .
  • Robinson , W. T. and Fornell , C. 1985 . Sources of market pioneer advantages in consumer goods industries . Journal of Marketing Research , 22 ( August ) : 305 – 317 .
  • Robinson , W. T. , Fornell , C. and Sullivan , M. 1992 . Are market pioneers intrinsically stronger than later entrants? . Strategic Management Journal , 13 : 609 – 624 .
  • Robinson , W. T. and Min , S. 2002 . Is the first to market the first to fail? Empirical evidence for industrial goods business . Journal of Marketing Research , 39 ( February ) : 120 – 128 .
  • Schoenecker , T. S. and Cooper , A. C. 1998 . The role of firm resources and organizational attributes in determining entry timing: A cross-industry study . Strategic Management Journal , 19 : 1127 – 1143 .
  • Shankar , V. , Carpenter , G. S. and Krishnamurthi , L. 1999 . The advantages of entry in the growth stage of the product life cycle: An empirical analysis . Journal of Marketing Research , 36 ( May ) : 269 – 276 .
  • Shi , L. 2010 . An investigation of the sources of store-based retailers’ early entrant advantages: Market and resource factors . Journal of Marketing Channels , 17 : 1 – 18 .
  • Shi , L. , Hulland , J. , Chatterjee , R. and Nguyen , D. 2005 . Firm capabilities, timing of internet adoption, and performance . MSI Report , 4 ( 05-004 ) : 49 – 69 .
  • Slotegraaf , R. J. , Moorman , C. and Inman , J. J. 2003 . The role of firm resources in returns to market deployment . Journal of Marketing Research , 40 : 295 – 309 .
  • Stalk , G. , Evans , P. and Shulman , L. E. 1992 . Competing on capabilities: The new rules of corporate strategy . Harvard Business Review , 70 ( 2 ) : 57 – 69 .
  • Stewart , D. W. and Koslow , S. 1989 . Executional factors and advertising effectiveness: A replication . Journal of Advertising , 18 ( 3 ) : 21 – 32 .
  • Szymanski , D. M. , Bharadwaj , S. G. and Varadarajan , P. R. 1993 . An analysis of the market share-profitability relationship . Journal of Marketing , 57 ( July ) : 1 – 18 .
  • Teece , D. J. , Pisano , G. and Shuen , A. 1997 . Dynamic capabilities and strategic management . Strategic Management Journal , 18 ( 7 ) : 509 – 533 .
  • Trottman , M. 2007, June 27 . As competition rebounds, Southwest faces squeeze . Wall Street Journal , : A1 – A11 .
  • Urban , G. L. , Carter , T. , Gaskin , S. and Mucha , Z. 1986 . Market share rewards to pioneering brands: An empirical analysis and strategic implications . Management Science , 32 ( 6 ) : 645 – 659 .
  • Warren , S. 2005, February 4 . “Winglets” help planes life off, save fuel . Wall Street Journal , : B1 (Eastern Edition)
  • Wernerfelt , B. 1984 . A resource-based view of the firm . Strategic Management Journal , 5 : 171 – 180 .
  • Yeoh , P.-L. and Roth , K. 1999 . An empirical analysis of sustained advantage in the U.S. pharmaceutical industry: Impact of firm resources and capabilities . Strategic Management Journal , 20 : 637 – 653 .

Reprints and Corporate Permissions

Please note: Selecting permissions does not provide access to the full text of the article, please see our help page How do I view content?

To request a reprint or corporate permissions for this article, please click on the relevant link below:

Academic Permissions

Please note: Selecting permissions does not provide access to the full text of the article, please see our help page How do I view content?

Obtain permissions instantly via Rightslink by clicking on the button below:

If you are unable to obtain permissions via Rightslink, please complete and submit this Permissions form. For more information, please visit our Permissions help page.