Essays on CEO's Marketing Experience and Firm Value

Establishing the importance of marketing at the corporate strategy level in enhancing firm strategic outcomes, in particular, firm value, is critical to the advancement of the marketing profession. In this research, I investigate the main effects of the CEO’s marketing experience on firm strategic outcomes (marketing and R&D intensity, and firm value), as well as its moderating effect on these outcomes when activist investors intervene to influence management decisions in a firm. The first essay focuses on how CEO's marketing experience impacts innovation, marketing intensity, and firm value and on how these relationships are moderated by the CEO's ownership of the firm and by industry competition. Using motivation and agency theories, I develop a conceptual framework and hypotheses related to these important research questions and test them using a uniquely assembled panel dataset of 152 U.S. publicly traded firms over 10 years. The results reveal that the CEO’s marketing experience has both direct and indirect (through R&D intensity, marketing intensity, and the number of patents and trademarks) positive effects on firm value. These effects are weakened when the CEO’s ownership of the firm is high and are strengthened when industry competition is intense. \nThe second essay focuses on the effects of activist investor intervention on marketing and R&D intensity, and firm value, and the moderating role of the CEO’s marketing experience in these effects. I use a sample of 455 firms targeted by activist investors over 6 years (2010-2015) to examine the impact of activist investor intervention on marketing intensity, R&D intensity, and firm value through a differences-in-differences (DIFF-IN-DIFF) approach. The results suggest that activist investor intervention has a detrimental effect on not just marketing spending but also on innovation and firm value, but importantly, CEOs with marketing experience can mitigate the deleterious effect.