Constructing Innovation: How Firms Use Market Communication to Shape Perceptions of Innovation

Project Overview

In contemporary markets, competitive advantage depends not only on firms’ ability to innovate, but also on how innovation is communicated and perceived by external stakeholders. Prior research predominantly views innovation as an objective output but overlooks the role of communication in shaping market beliefs under uncertainty. This project reconceptualises innovation as a perception-based construct co-created through firm communication and stakeholder interpretation, focusing on earnings call communications as a strategic marketing tool through which firms construct narratives about their innovation.

What You Will Do

You will analyze large-scale textual data from earnings call transcripts combined with firm-level financial, analyst, and innovation data. Utilizing both traditional natural language processing techniques and advanced large language models, you will study how firms use language, framing, and narratives to influence stakeholder perceptions of innovation, and investigate the alignment or divergence between communicated and realised innovation.

Expected Outcomes

This research will clarify the "talk–walk gap" between firms’ communication and actual innovation outputs. It will advance marketing and innovation theory by positioning firm communication as key to constructing intangible asset value, and offer practical insights for firms to design credible innovation narratives and manage stakeholder expectations effectively.

Why This Matters

The project addresses a critical gap in understanding how intangible assets like innovation are perceived and valued in markets. By integrating communication, perception, and innovation outcomes, the research supports firms in sustaining long-term value in information-driven markets, offering both theoretical and practical advances in competitive strategy and financial communication.