Beating the Recession Blues: Exploring the Link between Family Ownership, Strategic Marketing Behavior, and Firm Performance During Recessions

Posted: 18 Aug 2013

See all articles by Saim Kashmiri

Saim Kashmiri

University of Mississippi - School of Business Administration

Vijay Mahajan

University of Texas at Austin - Department of Information, Risk and Operations Management

Date Written: August 16, 2013

Abstract

This research explores whether family firms exhibit unique marketing behavior, and whether their unique behavior in turn helps them outperform non-family firms during periods of economic contraction. Findings based on a sample of 275 large publicly listed U.S. firms reveal that family firms outperform non-family firms during recessions. This superior performance is partially driven by family firms’ proactive marketing behavior and their relatively high emphasis on corporate social responsibility (CSR). During recessions, while non-family firms tend to decrease their advertising intensity and rate of new product introductions (NPIs), family firms are likely to maintain relatively high levels of advertising intensity and rate of NPIs. Unlike non-family firms, family firms are also likely to maintain high levels of corporate social performance (CSP) during recessions. These results underscore the benefits of proactive marketing behavior and a continued emphasis on CSR during economic downturns. The authors also add to the scant family-firm literature, demonstrating the family firm to be an effective organizational form.

Keywords: Family firms, Recession, Advertising intensity, Innovation, Corporate social responsibility

Suggested Citation

Kashmiri, Saim and Mahajan, Vijay, Beating the Recession Blues: Exploring the Link between Family Ownership, Strategic Marketing Behavior, and Firm Performance During Recessions (August 16, 2013). Available at SSRN: https://ssrn.com/abstract=2311466

Saim Kashmiri (Contact Author)

University of Mississippi - School of Business Administration ( email )

PO Box 3986
Oxford, MS 38677
United States

Vijay Mahajan

University of Texas at Austin - Department of Information, Risk and Operations Management ( email )

Red McCombs School of Business
2100 Speedway, #B6600
Austin, TX 78712
United States

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