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Article
Publication date: 30 April 2020

Burze Yasar, Thomas Martin and Timothy Kiessling

This study aims to support and extend signalling theory because of information asymmetry. This study also aims to answer the call to further negative signalling and…

Abstract

Purpose

This study aims to support and extend signalling theory because of information asymmetry. This study also aims to answer the call to further negative signalling and explore immediate reactions to signals, thus alleviating a gap with regard to temporality of signalling.

Design/methodology/approach

The study used two separate data sources, the S&P 500 and 51,500 pages of the public papers between 1981 and 1999, nearly 20 years of data. Inter-rater reliability, controlled for all macroeconomic announcements identified in the literature, is used, and the data are empirically tested using generalized autoregressive conditional heteroscedasticity (GJR-GARCH) modelling.

Findings

In accordance with signalling theory and the efficient market hypothesis, the study found that receivers do react to positive signals from a credible insider signaller to obviate information asymmetry. In line with previous research, the study also finds that receivers react much stronger to negative signals.

Practical implications

Investors, financial managers and top executives responsible for their stock price need to focus on presidential signalling as these directly affect market volatility. In particular, investors and financial managers can predict stock price volatility based upon signals from the president.

Originality/value

This is the first research study that explores the correlation between presidential signalling and market volatility. This study is important for investors and financial managers.

Details

Management Research Review, vol. 43 no. 11
Type: Research Article
ISSN: 2040-8269

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Article
Publication date: 1 May 1994

Paul Herbig and John C. Milewicz

Examines marketing signals as they are used in business‐to‐businesscommunications. Marketing signals can be implemented in a variety oforganizational marketing activities…

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900

Abstract

Examines marketing signals as they are used in business‐to‐business communications. Marketing signals can be implemented in a variety of organizational marketing activities including promotion, pricing, distribution and competitive reactions. Provides observations and recommendations on their usage by industrial concerns so as to improve the efficiency of their signalling efforts.

Details

Marketing Intelligence & Planning, vol. 12 no. 4
Type: Research Article
ISSN: 0263-4503

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Article
Publication date: 1 November 1994

Paul Herbig, John C. Milewicz and Robert Gulbro

Marketing signals, whereupon marketing activities provide informationbeyond the activity itself, can be implemented in a variety of marketingactivities including…

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8320

Abstract

Marketing signals, whereupon marketing activities provide information beyond the activity itself, can be implemented in a variety of marketing activities including advertising, pricing, quality control, and competitive reactions. Examines marketing signals as they are used in the industrial marketplace. Provides examples and specific applications for each specific characteristic associated with industrial marketing. Also provides observations and recommendations on their usage by industrial concerns.

Details

Industrial Management & Data Systems, vol. 94 no. 9
Type: Research Article
ISSN: 0263-5577

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Article
Publication date: 1 June 1994

Paul Herbig and John Milewicz

Describes market signals and market signaling, provides examples oftheir use in service‐oriented industries and, through a marketsimulation, examines their implications…

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1919

Abstract

Describes market signals and market signaling, provides examples of their use in service‐oriented industries and, through a market simulation, examines their implications for profitability and competitive behavior. Marketing signals by firms within an industry are positively related to the profitability of the industry and the profits of the individual firms within the industry. However, there is a negative incentive for a firm to be the only signaler within an industry. This “lone man out” phenomenon puts a firm at a competitive disadvantage to the other firms within its industry. A “temporal pattern‐recognition deficiency” also seems to exist which tends to inhibit managers in finding patterns of behavior over time.

Details

Journal of Services Marketing, vol. 8 no. 2
Type: Research Article
ISSN: 0887-6045

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Article
Publication date: 1 February 1996

Paul Herbig

Marketing signals are communication vehicles which provide information beyond the mere form of the message ‐ a message within a message. These signals can be sent to…

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2063

Abstract

Marketing signals are communication vehicles which provide information beyond the mere form of the message ‐ a message within a message. These signals can be sent to competitors, customers, suppliers, or other interested stakeholders (e.g., government, stockholders, community). Discusses marketing signals and the advantages and disadvantages of market signalling. Provides the results of a study of business market signalling, and offers recommendations on how a firm can signal more effectively to its customers and competitors.

Details

Management Decision, vol. 34 no. 1
Type: Research Article
ISSN: 0025-1747

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Article
Publication date: 1 August 1995

Paul A. Herbig and John Milewicz

Examines the power of market signalling through a marketsimulation. Finds that use of marketing signals by firms within anindustry is positively related to the…

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986

Abstract

Examines the power of market signalling through a market simulation. Finds that use of marketing signals by firms within an industry is positively related to the profitability of the industry and the profits of the individual firms within the industry. The marginal contribution by the addition of another signaller to the industry is significant. However, there is a negative incentive for a firm to be the only signaller within an industry. This “lone man out” phenomenon puts a firm at a competitive disadvantage to the other firms within its industry. A “temporal pattern recognition deficiency” also seems to exist which inhibits managers from finding patterns of behaviour over time.

Details

Marketing Intelligence & Planning, vol. 13 no. 7
Type: Research Article
ISSN: 0263-4503

Keywords

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Article
Publication date: 2 March 2020

Aneesh Banerjee, Jörg M. Ries and Caroline Wiertz

Online B2B markets offer buyers a new source of information provided by social media signals about suppliers. These signals have not yet received much attention in the…

Abstract

Purpose

Online B2B markets offer buyers a new source of information provided by social media signals about suppliers. These signals have not yet received much attention in the supplier selection literature. This study advances our understanding of how buyers respond to social media signals in the supplier selection process.

Design/methodology/approach

We develop a choice-based conjoint experimental design to isolate and manipulate two signals from social media: volume (the number of ratings) and valence (average evaluation of the ratings). We test how these signals are interpreted in the context of varying deal sizes and price points.

Findings

Both volume and valence are positively correlated with supplier selection. However, (1) the signals exhibit diminishing returns and (2) the efficacy of valence is interpreted in the context of volume. We also find that (3) there is no influence of the deal size and that (4) the relationships between signals and supplier selection are negatively moderated by deviations from the reference price.

Research limitations/implications

Social media signals should be considered in supplier selection decisions as they convey valuable information to the buyer. However, signals go through a process of interpretation which has implications for buyers, suppliers, and owners of online B2B markets.

Originality/value

Our research opens new lines of inquiry in behavioural operations management research regarding the mechanisms by which buyers interpret social media signals and how these ultimately influence their choice.

Details

International Journal of Operations & Production Management, vol. 40 no. 5
Type: Research Article
ISSN: 0144-3577

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Article
Publication date: 4 December 2020

Hualong Yang, Helen S. Du and Wei Shang

Despite the prevalent use of professional status and service feedback in online healthcare markets, the potential interaction relationship between two types of information…

Abstract

Purpose

Despite the prevalent use of professional status and service feedback in online healthcare markets, the potential interaction relationship between two types of information is still unknown. This study used the signaling theory to examine the substitute relationship between professional status and service feedback in patients' doctor choice, as well as the moderating effect of illness severity.

Design/methodology/approach

To test the paper's hypotheses, we constructed a panel data model using 418 doctors' data collected over a period of six months from an online healthcare market in China. Then, according to the results of the Hausman test, we estimated a fixed-effects model of patients' choice in online healthcare markets.

Findings

The empirical results showed that the effect of a doctor's professional status and service feedback on a patient's doctor choice was substitutable. Moreover, patients' illness severity played a moderating role, in that the influence of professional status on a patient with high-severity illness was higher than that on a patient with low-severity illness, whereas the influence of service feedback on a patient with low-severity illness was higher than that of a patient with high-severity illness. In addition, we found that illness severity negatively moderated the substitute relationship between professional status and service feedback on a patient's choice.

Originality/value

These findings not only contribute to signaling theory and research on online healthcare markets, but also help us understand the importance of professional status and service feedback on a patient's choice when seeking a doctor online.

Details

Internet Research, vol. 31 no. 4
Type: Research Article
ISSN: 1066-2243

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Article
Publication date: 18 May 2020

Weihua Liu, Wanying Wei, Cheng Si, Dong Xie and Lujie Chen

This study empirically examines the impact of announcements on supply chain strategic collaboration (SCSC) on companies' shareholder value.

Abstract

Purpose

This study empirically examines the impact of announcements on supply chain strategic collaboration (SCSC) on companies' shareholder value.

Design/methodology/approach

This study analyzes changes in shareholder value of companies listed in China based on data of 208 SCSC announcements. The signaling theory is applied to determine correlation among SCSC announcements and the market. An event study is used to estimate the stock market reaction to SCSC announcements. The common market model estimates stock abnormal returns after the event. The least squares method and regression model calculate the model parameter value.

Findings

There is a positive and statistically significant relationship between SCSC announcement and shareholder value. Market reaction to product development collaboration is significantly higher than to technology-sharing collaboration, market collaboration, and other SCSC types. The market reacts more positively to suppliers and companies with greater supply chain control power than to buyers and companies with lower control power. Announcements from the service supply chain can lead to stronger market reactions than those from manufacturing supply chains.

Practical implications

The findings provide a systematic assessment of how SCSC announcements contribute to firms' shareholder value. The result provides a benchmark of value promotion that can be expected from SCSC announcements.

Originality/value

This study fills the research gap that using secondary data to assess changes in companies’ shareholder value caused by SCSC announcements and firstly examines these changes by constructing the signaler–signal–receiver progress based on signaling theory. The research results provide a new reference and inspiration for deeper understanding of the impact mechanism of SCSC. Furthermore, this study contributes to the development of the signaling theory using an empirical study in an emerging market, China.

Details

International Journal of Operations & Production Management, vol. 40 no. 4
Type: Research Article
ISSN: 0144-3577

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Book part
Publication date: 1 January 2005

Joseph Kang and David Ding

The study discussed in this article examines two empirical questions: (1) Can multiple financial signals enhance the intermediate-horizon returns of value and glamour…

Abstract

The study discussed in this article examines two empirical questions: (1) Can multiple financial signals enhance the intermediate-horizon returns of value and glamour investments on Asian stock markets? and (2) Do the return enhancements, if any, differ by value and growth firm types and vary across different markets? The results of this study show that financial signals affect return enhancements, and these enhancements differ by firm types and vary across markets. These differences can be explained by non-positive value premiums and relatively poor information quality documented on Asian markets.

Details

Research in Finance
Type: Book
ISBN: 978-0-76231-277-1

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