The Effects of Marketing Expenses on Firm Performance: Empirical Evidence from the BIST Textile, Leather Index

Konak, Fatih

doi:10.7763/joebm.2015.v3.335

Cited by 10 publications

(17 citation statements)

References 13 publications

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“…This result indicates that the role of research and development expenses will generate earnings as the effective use of assets and generate earnings for the company by invested money from the shareholders. It is consistent with the results from previous researcher Konak (2015). This result shows that research and development expense indicates the capital expenditure for the company.…”

Section: Gesti Memarista and Lila Gestantisupporting

confidence: 92%

“…Both activities require a lot of money in the short term, but they can yield enormous benefits in the long term (Konak, 2015). By spending money on research and development as well as promotion, the company will remain close to its customers and recognize opportunities to make a higher future stock return (Ali, Klasa, & Yeung, 2009).…”

Section: |mentioning

confidence: 99%

“…Despite marketing's importance, companies should be careful about how they use their money on research and development and selling expenses (Konak, 2015). In financial terms, marketing expenses can be categorized as a sunk cost (Ross, Westerfield, & Jordan, 2015).…”

Section: |mentioning

confidence: 99%

“…According to Konak (2015), marketing expense will be accepted as the element that impacts the profitability. Marketing expense was considered as the expenditure under the profit and loss statement in the company.…”

Section: Hypotheses Developmentmentioning

confidence: 99%

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Sunk Cost Dilemma Behavior: The Contribution Marketing Expenses towards Financial Performance

Memarista

Gestanti

2018

Jurnal Keuangan Dan Perbankan

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Marketing expenses can drove the financial performance of a company, but sometimes it was only a sunk cost. The sunk cost dilemma behavior can confuse a financial manager, confounding decisions about whether to invest in marketing. Thus, this study aimed to explain the relationship between marketing expenses and profitability. The research subjects were manufacturing firms listed on the Indonesia Stock Exchange between 2012 and 2016. The results showed that marketing-related research and development expenses, selling expenses, and operating cash flow had a significant positive relationship with return on assets (ROA) and return on equity (ROE). Moreover, lagged research and development expenses-specifically, expenses from the previous four years (RnDt-4)-had a significant effect on ROA and ROE. Leverage had a significant negative effect on ROA and ROE. On the other hand, firm size had no significant impact on profitability. The findings showed that marketing expenses were not a sunk cost; they were an investment that leads to good financial performance. Greater investments in marketing expected to entice consumers bought a company's products and created more profitability, leading to improved financial performance. AbstrakBeban pemasaran dapat mempengaruhi kinerja keuangan perusahaan, tetapi kadangkala beban pemasaran hanya sekedar sunk cost. Dilema sunk cost behavior dapat membingungkan manajer keuangan ketika mengambil keputusan investasi yang terkait pemasaran. Penelitian ini bertujuan untuk menganalisa pengaruh beban pemasaran terhadap profitabilitas. Subyek penelitian ini adalah perusahaan manufaktur yang terdaftar di Bursa Efek Indonesia selama 2012 hingga 2016. Hasil penelitian menunjukkan bahwa beban research and development, beban penjualan, dan operating cash flow berpengaruh signifikan positif terhadap return on assets (ROA) dan return on equity (ROE). Selain itu, beban lagged research and development pada empat tahun sebelumnya (RnD t-4 ) berpengaruh signifikan terhadap ROA dan ROE. Leverage berpengaruh negatif signifikan terhadap ROA dan ROE. Sebaliknya, firm size tidak berpengaruh signifikan terhadap profitabilitas. Hasil penelitian ini menunjukkan bahwa beban pemasaran bukan sunk cost. Beban pemasaran dapat menjadi investasi untuk dapat menghasilkan kinerja keuangan yang baik. Investasi yang lebih besar terkait hal pemasaran diharapkan menarik konsumen untuk membeli produk perusahaan dan menciptakan keuntungan yang lebih banyak, yang mengarah pada peningkatan kinerja keuangan.

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Section: Gesti Memarista and Lila Gestantisupporting

confidence: 92%

Section: |mentioning

confidence: 99%

Section: |mentioning

confidence: 99%

Section: Hypotheses Developmentmentioning

confidence: 99%

See 2 more Smart Citations

Sunk Cost Dilemma Behavior: The Contribution Marketing Expenses towards Financial Performance

Memarista

Gestanti

2018

Jurnal Keuangan Dan Perbankan

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“…About the impact of the structure of the selling expenses on the growth of the business, several different studies have been taken such as Agarwal et al (2009), Lindgreen and Wynstra (2005), Ramsey and Sohi (1997), and Konak (2015). However, instead of taking concentration directly on evaluating the influence of different types of selling expenses on business growth, these previous studies indicated the importance of marketing to the expansion of enterprise market share, to the growth of sales, or to maximising profitability.…”

Section: Literature Reviewmentioning

confidence: 99%

The Impacts of Selling Expense Structure on Enterprise Growth in Large Enterprises: A Study from Vietnam

Nguyen

Pham

et al. 2019

JRFM

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This study intends to examine the impact of selling expense structure on the business growth of 255 Vietnamese large-scale enterprises in three different industries (Consumer Staples, Industrials, and Manufacture) listed on the Vietnamese Stock Exchange over four years from 2015 to 2018. By using STATA software (StataCorp LLC, 4905 Lakeway Drive, College Station, Texas 77845-4512, USA), the research outcomes indicate that both labour expense and depreciation expense have a negative influence on revenue growth and firm size growth but positive influence on profit growth while materials and tools expenses negatively affect all three dependent variables. Furthermore, an increase in the proportion of outsourcing expenses and other selling expenses would result in a significant increase in revenue but a decline in the profit of these companies. From this research results, large-scale enterprises should consider changing the selling expense structure as they spend too much on outsourcing and other selling expenses (60%-70% total selling expense) but too little on labour, which plays an important role in upgrading the profitability of these enterprises. measure the growth of a business such as comparing revenue between the present year and the previous year (Davidsson et al. 2010) basing on industrial characteristics and corporate goals in a manner (Delmar et al. 2003;Koga and Kato 2017) or relying on the scale of the business (Hölzl and Friesenbichler 2010;Mansfield 1962;Hart and Oulton 1996;Jones and Miskell 2007).Previous studies have also pointed out factors affecting business growth. These factors include several characteristics of the enterprise's owners such as personal incentives, owner relationships, education background, and the features of that enterprise such as age, size, legal form, industry type, strategy, and financial structure (Harabi

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Drivers of competitiveness in the agricultural input sector: The case of agro-dealer businesses in Kenya

Wanyonyi

Gathungu

Bett

2023

Cogent Business & Management

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The Effects of Marketing Expenses on Firm Performance: Empirical Evidence from the BIST Textile, Leather Index

Cited by 10 publications

References 13 publications

Sunk Cost Dilemma Behavior: The Contribution Marketing Expenses towards Financial Performance

Sunk Cost Dilemma Behavior: The Contribution Marketing Expenses towards Financial Performance

The Impacts of Selling Expense Structure on Enterprise Growth in Large Enterprises: A Study from Vietnam

Drivers of competitiveness in the agricultural input sector: The case of agro-dealer businesses in Kenya

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