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We examine how product market threats influence firm payout policy and cash holdings. Using firms' product text descriptions, we develop new measures of competitive threats. Our primary measure, product market fluidity, captures changes in rival firms' products relative to the firm's products. We show that fluidity decreases firm propensity to make payouts via dividends or repurchases and increases the cash held by firms, especially for firms with less access to financial markets. These results are consistent with the hypothesis that firms' financial policies are significantly shaped by product market threats and dynamics.

What is the relationship between product design benefits (hedonic versus utilitarian) and the postconsumption feelings of customer delight and satisfaction? The primary insights this research provides are as follows: (1) Products that meet or exceed customers' utilitarian needs and fulfill prevention goals enhance customer satisfaction (e.g., a car with antilock brakes and vehicle stability assist), and (2) products that meet or exceed customers' hedonic wants and fulfill promotion goals enhance customer delight (e.g., a car with panoramic sunroof and six-speaker audio system). Furthermore, the research finds that the primary antecedent feelings of satisfaction are the prevention emotions of confidence and security provided by utilitarian benefits, whereas the primary antecedent feelings of delight are the promotion emotions of cheerfulness and excitement provided by hedonic benefits. Finally, the results show that delighting customers improves customer loyalty, as measured by word of mouth and repurchase intentions, more than merely satisfying them. The authors discuss the theoretical contribution and strategic insights the research provides for product designers and marketers.

We test for firm-level asset investment effects in returns by examining the cross-sectional relation between firm asset growth and subsequent stock returns. Asset growth rates are strong predictors of future abnormal returns. Asset growth retains its forecasting ability even on large capitalization stocks. When we compare asset growth rates with the previously documented determinants of the cross-section of returns (i.e., book-to-market ratios, firm capitalization, lagged returns, accruals, and other growth measures), we find that a firm's annual asset growth rate emerges as an economically and statistically significant predictor of the cross-section of U.S. stock returns.

We use neural data collected from an experimental asset market to measure regret preferences while subjects trade stocks. When subjects observe a positive return for a stock they chose not to purchase, a regret signal is observed in an area of the brain that is commonly active during reward processing. Subjects are unwilling to repurchase stocks that have recently increased in price, even though this is suboptimal in our experiment. The strength of stock repurchasing mistakes is correlated with the neural measures of regret. Subjects with high rates of repurchasing mistakes also exhibit large disposition effects.

We document the cross-sectional properties of corporate dividend-smoothing policies and relate them to extant theories. We find that younger, smaller firms, firms with low dividend yields and more volatile earnings and returns, and firms with fewer and more disperse analyst forecasts smooth less. Firms that are cash cows, with low growth prospects, weaker governance, and greater institutional holdings, smooth more. We also document that dividend smoothing has steadily increased over the past 80 years, even before firms began using share repurchases in the mid-1980s. Taken together, our results suggest that dividend smoothing is most common among firms that are not financially constrained, face low levels of asymmetric information, and are most susceptible to agency conflicts. These findings provide challenges and guidance for the developing theoretical literature.

Interactivity is a key feature of Web sites. This article identifies the determinants that enhance user perceptions of interactivity in a communication scenario in which consumers send instant messages to an e-store. Two conceptualizations of interactivity-telepresence theory and interactivity theory-predict that different antecedents (e.g., the number of clicks, response time, message type) are important. The results of Experiment 1 indicate that message type (i.e., how personal a particular message is) is the strongest predictor of interactivity perceptions. Furthermore, the findings suggest that the effects of message type on perceived interactivity and Web site effectiveness are greater when consumers are complaining than when they are inquiring about services. The results of Experiment 2 show that as the level of message personalization increases, interactivity perceptions and site effectiveness are enhanced (linear relationship). The authors discuss the implications of the findings for theory and practice and provide directions for measuring and manipulating interactivity in further research.

•Contextual stability furthers repurchasing of the same brand on the next category purchase.•A larger number of subsequent trips to the same retailer increase the repurchasing odds for the same brand.•A larger number of subsequent trips on the same day of the week increase the repurchasing odds for the same brand.•Buying on or off promotion on both trips increases the repurchasing odds for the same brand.•A promotion on only one trip of a purchase pair decreases the repurchasing odds for the same brand. The most basic manifestation of brand loyalty is repurchasing – making the same choice on the next category occasion. This study tests to which extent the stability of contextual cues across purchase occasions affects repurchasing. We investigate these effects by analyzing a total of 1.6 million brand choice pairs (i.e., two consecutive choices) of 20,587 German and 23,036 British shoppers in three FMCG categories. We find that stable contextual cues (same retailer, basket size or weekday as on previous occasions) further repurchasing whereas unstable contextual cues (different retailer, basket size or weekday as on previous occasions, a promotion chosen on one of the occasions or a different assortment size) hinder repurchasing. Furthermore, our results stress the importance of inertia and the power of private labels to foster repurchasing. This study provides generalizable insights regarding trip-to-trip stability in shoppers’ choices, proposes a metric to benchmark brand performance across multiple retail outlets, and pinpoints opportunities for manufacturer-retailer cooperation in order to nurture repurchasing. [Display omitted]

Many firms strive to create relationships with customers, but not all customers are motivated to build close commercial relationships. This article introduces a theoretical framework that explains how relationshipspecific attachment styles account for customers' distinct preferences for closeness and how both attachment styles and preferences for closeness influence loyalty. The authors test their predictions with survey data from 1199 insurance customers and three years of purchase records for 975 of these customers. They find that attachment styles predict customers' preferences for closeness better than established marketing variables do. Moreover, attachment styles and preferences for closeness influence loyalty intentions and behavior, controlling for established antecedents (e.g., relationship quality). Finally, exploring the underlying process, the authors show that preference for closeness partially mediates the effect of attachment styles on cross-buying behavior. This research provides novel customer segmentation criteria and actionable guidelines that managers can use to improve their ability to tailor relationship marketing activities and more effectively allocate resources to match customer preferences.

In this research, the authors propose that the relationship between satisfaction and repurchase behavior is moderated by customer, relational, and marketplace characteristics. They further hypothesize that the moderating effects emerge if repurchase is measured as objective behavior but not if it is measured as repurchase intentions. To test for systematic differences in effects, the authors estimate identical models using both longitudinal repurchase measures and survey measures as the dependent variable. The results suggest that the relationship between customer satisfaction and repurchase behavior is contingent on the moderating effects of convenience, competitive intensity, customer involvement, and household income. As the authors predicted, the results are significantly different for self-reported repurchase intentions and objective repurchase behavior. The conceptual framework and empirical findings reinforce the importance of moderating influences and offer new insights that enhance the understanding of what drives repurchase behavior.

We outline a dividend signaling model that features investors who are averse to dividend cuts. Managers with strong unobservable cash earnings pay high dividends but retain enough to be likely not to fall short next period. The model is consistent with a Lintner partialadjustment model, modal dividend changes of zero, stronger market reactions to dividend cuts than increases, comparatively infrequent and irregular repurchases, and a mechanism that does not depend on public destruction of value, which managers reject in surveys. New tests involve stronger reactions to changes from longer-maintained dividend levels and reference point currencies of American Depository Receipt dividends.