Whenever a recession occurs, there is a heated dialog among marketing academics and practitioners about the appropriate levels of marketing spending. In this article, the authors investigate whether firms should spend more on research and development (R&D) and advertising in recessions. They propose that the effects of changes in firms' R&D and advertising spending in recessions on profits and stock returns are contingent on their market share, financial leverage, and product-market profile (i.e., business-to-consumer goods, business-to-business services, business-to-business goods, or business-to-consumer services). They estimate the model using a panel of more than 10,000 firm-years of publicly listed U.S. firms from 1969 to 2008, during which there were seven recessions. Their results support the contingency approach. The authors compute the marginal effects, which show how the effects of changes in R&D and advertising spending in recessions vary across firms. The marginal effects provide evidence of inadequate spending (e.g., 98% of business-to-consumer goods firms underspend on R&D), proactivity (e.g., 96% of business-to-business services firms are at approximately the right levels on advertising). and excess spending (e.g., 92% of business-to-consumer services firms overspend on advertising). Using the authors' approach and publicly available data, managers can estimate the effects of their firms' and competitors' R&D and advertising spending on profits and stock returns in recessions.

Websites prominently display consumers' product ratings, which influence consumers' buying decisions and willingness to pay. Few insights exist regarding whether a consumer's online product rating is prone to social influence from others' online ratings. Examining this issue, the authors hypothesize that other consumers' online ratings moderate the effects of positive and regular negative features of product experience, product failure, and product recovery (to address product failure) on the reviewer's online product rating. The results from a model using 7499 consumers' online ratings of 114 hotels support the hypotheses. Other consumers' online ratings weaken the effects of positive and regular negative features of product experience but can either exacerbate or overturn the negative effect of product failure, depending on the quality of product recovery. For marketing theory, the findings indicate that consumers who influence others are themselves influenced by other consumers and that this influence is contingent on their product experience. For managerial practice, the authors offer a method to estimate the effects of product experience characteristics on online product ratings and show that social influence effects make high online product ratings a double-edged sword, exacerbating the negative effect of product failure and strengthening the benefit of product recovery.

Academic studies offer a generally positive portrait of the effect of customer relationship management (CRM) on firm performance, but practitioners question its value. The authors argue that a firm's strategic commitments may be an overlooked organizational factor that influences the rewards for a firm's investments in CRM. Using the context of online retailing, the authors consider the effects of two key strategic commitments of online retailers on the performance effect of CRM: their bricks-and-mortar experience and their online entry timing. They test the proposed model with a multimethod approach that uses manager ratings of firm CRM and strategic commitments and third-party customers' ratings of satisfaction from 106 online retailers. The findings indicate that firms with moderate bricks-and-mortar experience are better able to leverage CRM for superior customer satisfaction outcomes than firms with either low or high bricks-and-mortar experience. Likewise, firms with moderate online experience are better able to leverage CRM into superior customer satisfaction outcomes than firms with either low or high online experience. These findings help resolve disparate results about the value of CRM, and they establish the importance of examining CRM within the strategic context of the firm.

Dual distribution systems where firms simultaneously use vertical integration and market governance are widely used across diverse marketing contexts (e.g., restaurants, retailing, and industrial selling). A prominent example of dual distribution includes business format franchising, where firms, the franchisors, license operation of some of its units to franchisees while simultaneously owning and operating some units themselves. Despite the widespread prevalence of dual distribution, there are few insights on their performance implications. In this paper, I examine the relationship between a firm's dual distribution strategy and its intangible value. Franchising in restaurant chains serves as the empirical context for the study.

Transparent packages are pervasive in food consumption environments. Yet prior research has not systematically examined whether and how transparent packaging affects food consumption. The authors propose that transparent packaging has two opposing effects on food consumption: it enhances food salience, which increases consumption (salience effect), and it facilitates consumption monitoring, which decreases consumption (monitoring effect). They argue that the net effect of transparent packaging on food consumption is moderated by food characteristics (e.g., unit size, appearance). For small, visually attractive foods, the monitoring effect is low, so the salience effect dominates, and people eat more from a transparent package than from an opaque package. For large foods, the monitoring effect dominates the salience effect, decreasing consumption. For vegetables, which are primarily consumed for their health benefits, consumption monitoring is not activated, so the salience effect dominates, which ironically decreases consumption. The authors' findings suggest that marketers should offer small foods in transparent packages and large foods and vegetables in opaque packages to increase postpurchase consumption (and sales).