Regulatory focus and investment advisers' recommending behavior
Purpose: This study examines the effect of a regulatory-focused prime (i.e. a brochure with a picture and message) on the recommending behavior of investment advisers in the context of an investment decision. Design/methodology/approach: Three experiments were conducted with 468 participants, mostly from the financial services industry. Study 1 examined the direct effect of a regulatory-focused prime on an investment adviser's recommending behavior, whereas Study 2 examined the moderating role of regulatory fit on such behavior. Study 3 validated the findings. Findings: The results provide evidence that a message using visual and textual cues based on a promotion and prevention regulatory focus may trigger a preference in an investment adviser's product recommendation. A promotion (prevention)-focused framed message will trigger the recommendation of an investment plan with a higher but riskier (safe and stable) potential return. However, when the same prime is presented with details of a performance incentive scheme, the effect of the prime is reduced when there is a regulatory nonfit between the prime and the message relating to the performance incentive scheme. Practical implications: The findings highlight the importance of understanding how regulatory-focused stimuli may subconsciously influence the recommendation of investment advisers as heuristics used in decision-making, thereby influencing their clients' investment decisions. Originality/value: Past studies have focused on how regulatory-focused visual and message cues influence consumer decision-making. This study provides empirical evidence regarding the influence of regulatory-focused prime on an investment adviser's behavior when providing investment advice.
Year of publication: |
2020
|
---|---|
Authors: | Ewe, Soo Yeong ; Lee, Christina Kwai Choi ; Gul, Ferdinand A. |
Published in: |
International Journal of Bank Marketing. - Emerald, ISSN 0265-2323, ZDB-ID 2032104-1. - Vol. 39.2020, 1 (05.11.), p. 107-126
|
Publisher: |
Emerald |
Saved in:
Online Resource
Saved in favorites
Similar items by person
-
Soo Yeong Ewe, (2018)
-
Networking externalities and the perception of innovation characteristics : mobile banking
Soo Yeong Ewe, (2015)
-
Network externalities and the perception of innovation characteristics: mobile banking
Ewe, Soo Yeong, (2015)
- More ...