Stock Market Reactions to New Product Launches in International Markets: The Moderating Role of Culture

2019 ◽  
Vol 27 (4) ◽  
pp. 81-98 ◽  
Author(s):  
M. Berk Talay ◽  
M. Billur Akdeniz ◽  
Michael Obal ◽  
Janell D. Townsend
Keyword(s):  
Stock Market ◽  
Firm Value ◽  
New Product ◽  
International Markets ◽  
Product Launch ◽  
Market Reactions ◽  
Product Launches ◽  
Stock Market Reactions ◽  
The Impact

Prior research indicates the importance of new product launches across international markets for firm performance. However, little is known about if, and how, new product launches in international markets drive firm financial value. This study examines the drivers of stock market reactions to a new product introduction in a foreign country, along with the moderating impact of cultural context. Using a sample of 1,154 products in 34 product categories launched in 48 countries between 2011 and 2018, the authors investigate how product characteristics such as product innovativeness and product type affect abnormal stock reactions to a new product launch event. Furthermore, the authors assess the role of the national culture by considering the individualism, uncertainty avoidance, and indulgence characteristics of the country where the new product is launched. Results of a mixed-effects estimation model indicate that product launches in international markets with innovativeness and hedonism characteristics positively affect firm value. The effects of culture are complex and multifarious, providing valuable insights regarding the impact of new product introductions in global markets on firm value.

New product announcement: spokesperson a manifestation of increasing firm value

2018 ◽  
Vol 13 (6) ◽  
pp. 1635-1655
Author(s):  
Bikram Jit Singh Mann ◽  
Sonia Babbar
Keyword(s):  
Event Study ◽  
Firm Value ◽  
Source Credibility ◽  
Shareholder Value ◽  
Abnormal Returns ◽  
New Product ◽  
Content Type ◽  
Study Methodology ◽  
The Impact

Purpose Before introducing new products, companies make announcements regarding the launch of the product which influences stock market yields of the announcing companies. Information content of the new product announcement has never been an exclusive focused stream of research. Therefore, an assessment of the impact of the content characteristics of the new product announcement on the shareholder value and the impact of source credibility (spokesperson) in making such announcements is a major gap in the existing literature. The paper aims to discuss these issues. Design/methodology/approach First, the standard event study methodology has been employed on the sample to measure the abnormal gains/losses accruing to the announcing firms. Second, moderated regression analysis (MRA) is employed to identify the characteristics of the new product announcement and to check the role of the spokesperson in creating shareholder value. Findings The results of the event study indicate that the abnormal returns are generated during the new product announcement. The results of MRA disclose the variables having a positive and a significant influence on the effective returns of the announcing companies. Likewise, the role of the spokesperson has come out brightly as a credible communicator. Originality/value The research provides a direction to the announcing companies regarding the content of the announcement leading to a positive perception among the investing community. Likewise, it also provides direction to the investor community about the characteristics of the announcement content they give weight age in forming a perception of strength in evaluating the new product announcement, to which they are largely unaware.

ARE INNOVATIVE ORGANIZATIONAL CONCEPTS ENOUGH FOR FOSTERING INNOVATION?

2012 ◽  
Vol 16 (01) ◽  
pp. 1250005 ◽  
Author(s):  
JASNA PRESTER ◽  
MARLI GONAN BOZAC
Keyword(s):  
Positive Impact ◽  
New Products ◽  
New Product ◽  
Product Launch ◽  
Organizational Practices ◽  
Chi Square ◽  
Chi Square Test ◽  
Product Launches ◽  
The Difference ◽  
The Impact

The purpose of this article is to define which organizational practices have significant impact on returns from new products or which foster or at least influence positively innovation. Survey responders were divided to see whether they innovated or not by the survey questions which explicitly asked them if they have introduced new products in the last two years. With Chi Square test, we identified the difference in usage of certain organizational practices. After that, two multi-regression models showed the impact on launching a new product and their impact on generated returns from new products.There is a significant statistical difference in usage of these four practices between innovators and non-innovators: temporary cross-functional project teams, quality circle, ISO 9000, financial participation by employees. Regression analyses showed that for new product launch, quality circles and ISO900 have a positive impact. Since not all new product launches do not become successes when regressed to returns on new products, team performance incentives and knowledge-based systems have a significant positive impact. To our knowledge and through our literature research, we did not find works that explored the impacts of innovative organizational concepts on the final result — innovation. Most studies focused only on some organizational innovations and their impact on innovation. Here we present an overall overview of innovative organizational practices, why they are mostly used and identified those which mostly influence innovation.

When do Firms with new CEOs Engage in M&A? The Role of Stock Market Reactions to the CEO Appointment

2021 ◽  
Vol 2021 (1) ◽  
pp. 14000
Author(s):  
Marie-Ann Betschinger ◽  
Caterina Moschieri ◽  
Olivier Bertrand ◽  
Mahmoud Aidli
Keyword(s):  
Stock Market ◽  
Market Reactions ◽  
Stock Market Reactions

The Impact of Information Security Events on the Stock Value of Firms: The Effect of Contingency Factors

2011 ◽  
Vol 26 (1) ◽  
pp. 60-77 ◽  
Author(s):  
Ali Alper Yayla ◽  
Qing Hu
Keyword(s):  
Information Security ◽  
Stock Market ◽  
Negative Impact ◽  
Denial Of Service ◽  
Future Research ◽  
Event Analysis ◽  
Market Reactions ◽  
Security Breaches ◽  
Stock Market Reactions ◽  
The Impact

The stock market reactions to information technology (IT)-related events have often been used as proxies to the value or cost of these events in the information systems literature. In this paper, we study the stock market reactions to information-security-related events using the event analysis methodology with consideration of the effects of a number of contingency factors, including business type, industry, type of breach, event year, and length of event window. We found that pure e-commerce firms experienced higher negative market reactions than traditional bricks-and-mortar firms in the event of security breach. We also found that denial of service attacks had higher negative impact than other types of security breaches. Finally, security events occurred in recent years were found to have less significant impact than those occurred earlier, suggesting that investors may have become less sensitive to the security events. Most interestingly, our analyses showed that the magnitude and longevity of security breaches vary with time across sub-samples. This raises some serious questions regarding the validity of analyzing only short-term stock market reactions as an indicator of the cost of security breaches, and in general, an indicator of the value of IT-related events. The implications of these results are discussed and potential future research directions are proposed.

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