Myopic marketing spending—curtailing marketing and research and development expenses to boost earnings—damages firms’ long-term value. Despite this, Top Management Teams (TMTs) are often myopic and by the time investors or boards detect such short-termism, it is too late to react or intervene. This research introduces a novel prediction method by analyzing the language TMTs use in earnings’ calls, specifically focusing on marketing and earnings emphasis, to predict future instances of myopic marketing spending. Through linguistic dependency parsing of almost 11 million sentences extracted from nearly 25,000 quarterly earnings call transcripts of 1,197 firms between 2008–2019, we demonstrate the proposed approach can predict myopic marketing spending at a quarterly frequency for up to one year in advance. We find that one standard deviation increase in earnings emphasis is associated with 23.68% increase in the likelihood of future myopic marketing spending. Investments based on the proposed approach produce 1.61% additional annual abnormal returns compared to models that exclusively use known predictors of myopic marketing spending, while offering earlier foresight and more frequent opportunities for interventions. This reduces information asymmetry for investors and boards of directors.

中文翻译：

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EXPRESS：言语胜于行动吗？使用高层管理团队的语言来预测短视的营销支出

短视的营销支出——削减营销和研发支出以提高收益——会损害公司的长期价值。尽管如此，高层管理团队 (TMT) 往往目光短浅，当投资者或董事会发现这种短期主义时，做出反应或干预为时已晚。本研究引入了一种新颖的预测方法，通过分析 TMT 在财报电话会议中使用的语言，特别关注营销和盈利重点，以预测未来短视营销支出的情况。通过对从 2008 年至 2019 年间 1,197 家公司的近 25,000 份季度财报电话会议记录中提取的近 1100 万个句子进行语言依存分析，我们证明所提出的方法可以提前一年以季度频率预测短视营销支出。我们发现，对盈利的重视程度每增加一个标准差，未来短视营销支出的可能性就会增加 23.68%。与专门使用已知的短视营销支出预测因子的模型相比，基于所提议方法的投资可产生 1.61% 的额外年度异常回报，同时提供更早的预见和更频繁的干预机会。这减少了投资者和董事会的信息不对称。