IIM Seminar Talk: Brand Acquisition Discount on Tuesday, June 11, 2024

Vergrößern

We are very pleased to invite you to a seminar talk on Tuesday, June 11, 2024, with Christian Schäfer, who is a research associate at the University of St. Gallen. On June 11, Chris will present a current research project on Brand Acquisition Discount.

The seminar talk will take place on

Date: Tuesday, June 11, 2024

Time: 12:00 pm – 13:00 pm

Location: Ludwigstr. 28 RG; Room 329

Abstract: We study the implications of a recent brand acquisition case. Specifically, we investigate the consumer reactions following the public announcement of the majority stake acquisition in an innovative German manufacturer brand by one of the world’s largest multinational food companies. Using field data, we analyze consumer reactions on social media as well as offline and online sales/revenue trends. We find considerable deterioration in consumer reactions: revenues drop by a substantial effect range, depending on the context and model specifications. On average, revenues recover after about six months (online shop) and one year (supermarkets), with some products taking even longer to recuperate to pre-shock revenue levels. While demand-side reactions towards brand acquisitions might, upon other terms, be rather benevolent, we document a large brand acquisition discount in the present case. Specifically, our findings indicate a substantial and sizable demand-side reaction to what consumers interpret as a violation of their motivated beliefs in the manufacturer brand’s intrinsic motivation. Further, we map and theorize how the exogenous acquisition signal is transmitted into the market. Findings suggest that this demand-side reaction stems also from a previous marketing decision: the brand’s high engagement with influencers, who reverse their support and exacerbate the negative consumer response. By shedding light on the transmission of the acquisition signal and its impact on real-world buying behavior in a nonlocal, mainstream market, we suggest a more nuanced view on demand-side reactions in the aftermath of transgressive brand events.

We warmly welcome early-stage researchers to join us at the talk, and are looking forward to seeing you there!