Analyzing the financial benefit of marketing is a critical topic for both practitioners and researchers. Companies view marketing costs as investments and expect them to generate returns in the form of profit. In order to increase their value, companies adopt various innovative strategies. This study aims to examine the impact of marketing investment on firm value and systematic risk in four Arabic emerging markets from 2010 to 2019. The study utilizes firm share price and beta share as measures of firm value and systematic risk, respectively. Additionally, the ownership concentration variable is considered as a moderator in the relationship between marketing investment and firm value/systematic risk, as it is known to be a determinant factor in these variables. Using panel data regression analysis, the findings reveal that increasing investment in marketing has a positive effect on the firm value valuation model. Furthermore, it is found that the ownership concentration variable reinforces the relationship between marketing investment and firm value. The variable also moderates systematic risk by aligning with the monitoring impact of controlling shareholders. This study provides valuable insights by combining governance-marketing dimensions to interpret performance indicators in the capital market. By examining the relationship between marketing investment, firm value, systematic risk, and ownership concentration, it offers a comprehensive understanding of how these factors interact within Arabic emerging markets. Overall, this research contributes to the ongoing discussion on analyzing the financial benefit of marketing and highlights its significance for companies looking to enhance their value. The findings can inform practitioners' decision-making processes regarding marketing investments and provide researchers with valuable insights into understanding performance indicators in emerging markets.
Analyzing the financial benefit of marketing means looking at how marketing helps companies make money.
Companies see marketing costs as investments because they expect to make a profit from them.
Companies use innovative strategies to increase their value, which means making themselves more valuable.
This study looks at how investing in marketing affects the value and risk of companies in four Arabic emerging markets from 2010 to 2019.
Firm value is measured by the share price of a company, and systematic risk is measured by beta share.
The ownership concentration variable is a factor that affects the relationship between marketing investment and firm value/systematic risk.
Increasing investment in marketing has a positive effect on how much a company is worth.
The ownership concentration variable makes the relationship between marketing investment and firm value stronger.
The ownership concentration variable also affects systematic risk by aligning with controlling shareholders' monitoring impact.
This study combines governance-marketing dimensions to understand performance indicators in the capital market.
It provides a comprehensive understanding of how different factors work together in Arabic emerging markets.
It shows why analyzing the financial benefit of marketing is important for companies trying to increase their value.
The findings can help companies make better decisions about investing in marketing.
It also gives researchers valuable insights into understanding performance indicators in emerging markets."
Analyzing the Financial Benefit of Marketing: A Study of Arabic Emerging Markets
Marketing is an essential part of any business, and companies view marketing costs as investments that should generate returns in the form of profit. To maximize their value, businesses must adopt innovative strategies to ensure they are making the most out of their marketing efforts. This study examines the impact of marketing investment on firm value and systematic risk in four Arabic emerging markets from 2010 to 2019. It also considers ownership concentration as a moderator in this relationship between marketing investment and firm value/systematic risk.
Background
The importance of understanding how marketing affects financial performance has been widely discussed by both practitioners and researchers alike. Companies often invest heavily in marketing activities such as advertising, promotions, public relations, etc., with the expectation that these investments will result in increased profits or improved market share. However, it can be difficult to measure the return on these investments due to a lack of reliable data or other factors such as market conditions or competition levels. As such, there is a need for more research into this area so that businesses can make better-informed decisions about their marketing strategies.
Objectives
This study aims to examine how different variables interact within Arabic emerging markets with regards to measuring firm value and systematic risk when considering investing in marketing activities. Specifically, it looks at how increasing investment in marketing impacts firm value valuation models and whether ownership concentration moderates this relationship between them. Additionally, it seeks to determine if ownership concentration also moderates systematic risk by aligning with the monitoring impact of controlling shareholders.
Methodology
To conduct this research study, panel data regression analysis was used using firm share price and beta share as measures for firm value and systematic risk respectively while taking into account ownership concentration variable as well which is known to be a determinant factor for these variables . The sample size included 4 Arabic emerging markets from 2010-2019 period .
Findings
The findings reveal that increasing investment in marketing has a positive effect on the firm’s overall value valuation model while also moderating systematic risk by aligning with the monitoring impact provided by controlling shareholders through ownership concentration variable . Furthermore , it was found that higher levels of ownership concentration reinforce this relationship between increased investment in marketing activities and enhanced company values .
Conclusion
Overall , this research provides valuable insights into analyzing financial benefit associated with investing in various types of promotional activities within Arabic emerging markets . By examining different aspects like relationships between firms' values , systematic risks & ownership concentrations along with its effects on company's overall profitability , it offers comprehensive understanding regarding how all these factors interact together & helps inform decision makers regarding what type & amount should be invested towards promotional activities based upon current market conditions .
Analyzing the financial benefit of marketing is still a critical topic for both practitioners and researchers. Companies consider marketing costs as a type of investment and expect this investment to be returned to the company in the form of profit. On the other hand, companies adopt different innovative strategies to increase their value. Therefore, this study aims to test the impact of marketing investment on firm value and systematic risk. To do so, data related to four Arabic emerging markets during the period 2010-2019 are considered, and firm share price and beta share are considered to measure firm value and systematic risk, respectively. Since a firm's ownership concentration is a determinant factor in firm value and systematic risk, this variable is considered a moderated variable in the relationship between marketing investment and firm value and systematic risk. The findings of the study, using panel data regression, indicate that increasing investment in marketing has a positive effect on the firm value valuation model. It is also found that the ownership concentration variable has a reinforcing role in the relationship between marketing investment and firm value. It is also disclosed that it moderates the systematic risk aligned with the monitoring impact of controlling shareholders. This study provides a logical combination of governance-marketing dimensions to interpret performance indicators in the capital market.
