Media sentiments and firm’s sales growth: the moderating role of offering characteristics

Purpose: Although the interest in firm media sentiment has been increasing, the impact of news media sentiments on consumers’ perception of firms’ offerings and, subsequently, their sales remain unknown. This study aims to address this research question in this study. Furthermore, the authors consider the role of two boundary conditions, i.e., offerings’ similarity and offerings’ service ratio, that moderate the main relationship. Design/methodology/approach: Using a comprehensive and novel data set of over 900 firms between 2009 and 2019 from multiple sources, this study addresses the research questions. The authors use a fixed effects panel regression model to estimate the model. Findings: A firm’s news media sentiments can influence consumers’ perception of the corporate brand, thereby driving sales growth. This study finds that when a firm’s offerings are not differentiated from its competitors, news media sentiments become more important and so does when a firm offers more services than a product. Research limitations/implications: To the best of the authors’ knowledge, this study is the first to assess customers’ responses as manifested in the sales growth of a firm’s offerings, using both primary and secondary data and analysis. Practical implications: The findings provide actionable insights to managers by identifying specific offerings-related attributes – similarity and service ratio – where media sentiments play a critical role in influencing sales growth. Originality/value: While existing studies in marketing have primarily considered user-generated social media sentiments, this study departs from this literature by investigating earned media sentiments through traditional media outlets such as newspapers and business magazines, which have rarely been studied in marketing.