TY  - JOUR
AB  - Purpose Managers face the challenge of balancing resources needed to support value creation and value appropriation. In this study the authors analyze the impacts of innovation investments (i.e. value creation: VC) on advertising expenditures (i.e. value appropriation: VA), and vice versa, and verify the effects of these options on short- and long-term performance.Design/methodology/approach The effects of these two activities on short- and long-term performance were analyzed observing a panel of 4,090 companies of Standard and Poor's Compustat database from a 40-year period. The authors adopted the panel vector autoregressive (VAR) approach, using the generalized method of moments (GMM).Findings Although there is a trade-off between the strategic emphases on creating and appropriating value, there is also a synergy between them. The results from the impulse response functions support the argument for a virtuous business circle: companies that choose to intensify their investments in R&D tend to increase advertising expenditures, and vice versa.Practical implications Managers, rather than having to deal with a trade-off between allocating resources either on VC or VA activities, can capitalize on synergetic benefits resulting from the interaction among them.Originality/value The relationship between the VC and VA activities transcends the trade-off imposed by resource restrictions, since the interaction between them creates additional benefits afforded by the synergy of these activities.
VL  - 39
IS  - 1
SN  - 0263-4503
DO  - 10.1108/MIP-11-2019-0592
UR  - https://doi.org/10.1108/MIP-11-2019-0592
AU  - Silveira Cleo Schmitt
AU  - Oliveira Marta Olivia Rovedder de
AU  - Heldt Rodrigo
AU  - Luce Fernando Bins
PY  - 2020
Y1  - 2020/01/01
TI  - Trade-off between value creation and value appropriation?
T2  - Marketing Intelligence & Planning
PB  - Emerald Publishing Limited
SP  - 1
EP  - 16
Y2  - 2024/04/19
ER  -