TECHNOLOGY VERSUS DESIGN INNOVATION’S EFFECTS ON SALES AND TOBIN’S Q: THE MODERATING ROLE OF BRANDING STRATEGY

This research investigates the impacts on firm performance of (1) technology versus design innovation and (2) their potentially synergistic interaction. Synergies could arise from complementarities, in particular the utilization of technology innovation as a platform for design innovations. Both sales and Tobin’s q are examined as dependent performance variables, with sales tapping consumer responses and Tobin’s q reflecting investor responses. Moderation by branding strategy (i.e., Corporate Branding versus Mixed Branding versus House of Brands) is analyzed because innovation may impact performance differently depending on branding strategy. Advertising effects, the number of new product introductions, their interaction, R&D expenditures, operating margins and firm size are also modeled as covariates. The results show that all main and interaction effects are significant in at least one of the branding groups, and that moderation of model paths by branding strategy was pervasive