Media Endorsements of New Product Announcements: A New Marketing Strategy. (29th December 2014)

• Record Type: Journal Article
• Authors: Doukas, Angelos J.; Guo, Jie (Michael); Lam, Herbert Y. T.; Xiao, Sarah (Hong)
• Is Part Of: European financial management. Volume 22:Number 3(2016:Jun.)
• Page Start: 394
• Page End: 426
• Publication Date: 2014-12-29
• Subjects: product launch -- event study -- media sentiment -- textual analysis -- industry rivals; Finance -- European Union countries -- Periodicals; International finance -- Periodicals; Corporations -- European Union countries -- Finance -- Periodicals; 332.094
• DOI: 10.1111/eufm.12057
• Languages: English
• ISSNs: 1354-7798

Abstract

Abstract: This paper examines whether investors' decisions are influenced by the word content of newspaper reports of new product announcements. Using textual analysis we find that announcements of new products covered by financial newspapers with positive word content earn significant abnormal returns. These returns are 270 basis points higher than new products without positive word coverage, and such announcements bring negative impact to their rival firms' value. Our results suggest that the market reacts to the linguistic content of the new product announcement rather than to the announcement itself.