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Seeking pleasure or avoiding pain: Influence of CEO regulatory focus on firms' advertising, R&D, and marketing controversies

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  • Kashmiri, Saim
  • Gala, Prachi
  • Nicol, Cameron Duncan

Abstract

This research examines the influence of CEOs' regulatory focus on firms' strategic marketing behavior. The authors propose that the degree of CEOs' promotion focus relative to their prevention focus positively impacts firms' advertising and R&D intensities. However, the authors also propose a dark side of predominantly promotion-focused CEOs: a higher likelihood of firms getting involved in marketing controversies. The impact of CEO regulatory focus on these outcomes is proposed to be magnified when CEOs have high power, when stock options comprise a small proportion of CEOs' compensation, and when firms operate in highly dynamic environments. Findings based on observing a sample of publicly listed U.S. firms between 2006 and 2010 provide considerable support for the authors' hypotheses. These findings have important implications for managers, board members, investors, and researchers interested in the determinants of and mechanisms to prevent marketing myopia and marketing controversies.

Suggested Citation

  • Kashmiri, Saim & Gala, Prachi & Nicol, Cameron Duncan, 2019. "Seeking pleasure or avoiding pain: Influence of CEO regulatory focus on firms' advertising, R&D, and marketing controversies," Journal of Business Research, Elsevier, vol. 105(C), pages 227-242.
    • Handle: RePEc:eee:jbrese:v:105:y:2019:i:c:p:227-242
    DOI: 10.1016/j.jbusres.2019.08.022
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