A behavioural study of consumer boycott

This paper studied sales of BP branded gasoline in the United States of America prior, during and after the 2010 BP Deepwater Horizon oil spill accident. The research was funded by the Centre for Sustainable and Responsible Organisations at Deakin University. In what is perhaps the first behavioral study of consumer boycott using market level data, we found that consumers’ with geographic proximity to the accident were more likely to boycott the BP brand. In States that bordered or were close to the Gulf of Mexico, BP sales experienced a small but significant decline as compared to sales in States farther away. The small effect is surprising. We suspect this may be related to the inelastic nature of the product category and the high degree of product homogeneity within the category. It appears that consumers’ and the media’s vocalized outrage over the Deepwater Horizon accident did not result in significant changes in purchase behavior. As such, while consumers were outraged by BP’s actions, they continued to purchase the BP brand. Consumers who lived farther from the spill did not appear to alter their buying patterns even in the short-term, despite being exposed to similar media coverage and high levels of negative public sentiment. In examining changes in BP brand-share with both positive (i.e., claims of success in dealing with the spill) and negative events (evidence that attempts to stop the spill failed), we observed some associations between these events and changes in buying behavior. In States close to the accident, BP purchases increased with good news, market share declined with bad news. No apparent correlation was seen in States that were farther from the accident.