Advertising Standardization's Positive Impact on the Bottom Line: A Model of When and How Standardization Improves Financial and Strategic Performance

Building on Zou and Cavusgil's (2002) global marketing strategy (GMS) framework, the authors propose a structural model of advertising standardization that explores (1) the factors that encourage firms to engage in standardized advertising; and (2) the impact of advertising standardization on advertising effectiveness, as well as on two measures of firm performance. Results from a survey of Japanese and U.S. subsidiaries operating in the European Union (EU) provide support for the model. They also suggest that standardized advertising does enhance a firm's financial and strategic performance, provided that the external environment and internal resources of the firm are conducive to standardization.