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Introduction to the Special Issue: Consumer Behavior

Analysis: Behavioral Economics Meets the Marketplace

Article  in  The Psychological record · April 2013

DOI: 10.11133/j.tpr.2013.63.2.001

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The Psychological Record, 2013, 63, 231–238

Introduction to the Special Issue

Consumer Behavior Analysis:

Behavioral Economics Meets the Marketplace
Gordon R. Foxall
Cardiff University

Valdimar Sigurdsson
Reykjavik University

The extension of behavior analysis into realms beyond the traditional experimental
analysis of animal behavior makes possible the investigation of areas of human behavior that
have previously been the province of such disciplines as cognitive psychology and
microeconomics. This extension has taken two forms, which have, although usually
separately, contributed to the translation of behavior analytic methods and results into the
study of behavior in natural settings. The first is the application of behavior analytic methods
to the broader realm of behavior, often incorporating field experimental designs that
maximize the continuity of the laboratory-­based study of behavior with the applied sphere of
activity. Applied behavior analysis exemplifies this tendency par excellence. Another
example is the way in which the use of methods of scientific analysis and interpretation,
developed and honed in behavior analysis in its more traditional contexts, has given birth in
recent decades to behavioral economics, which combines the experimental methodology of
operant psychology with microeconomics. Behavioral economics has also been successfully
combined with the analysis of behavior in general as well as with applied behavior analysis
in human contexts. The second trend has been toward the interpretation of behavior, the
complexities of which preclude an experimental analysis, based on an extrapolation of the
principles of behavior that have been demonstrated in controlled experimental settings. In all
of these enterprises, the aim has been to enlarge the capacity of behavior analysis to elucidate
human activity in natural settings, with the aim of demonstrating that a behaviorist
understanding can be provided for such behavior, and sometimes with the aim of modifying
that behavior. In this paper, we describe an extension of behavior analysis toward
understanding the behavior of human consumers in market contexts; specifically, we are
concerned with the ways in which behavioral economics has been taken a stage further to
embrace the analysis of human consumers’ behavior in natural settings provided by market
economies. In short, we are arguing for consumer behavior analysis as an integral component
of applied behavior analysis.
Since its inception, consumer behavior analysis has been understood as the application
of behavioral economics to consumer behavior in marketing-­oriented economies (Foxall,
2001, 2002). It has, therefore, been concerned primarily with human behavior, in naturally
occurring settings, subject to marketing influence. This does not rule out in any way
comparative methodologies: the behavior of non-­human animals, the use of experimental
methods, the analysis of subsistence economies (e.g., through barter), and so forth. In time
these may well form part of the core of consumer behavior analysis; for the moment, the
emphasis is on marketing-­oriented economies. The unifying framework for this research is
DOI:10.11133/j.tpr.2013.63.2.001
232 Foxall and Sigurdsson

the Behavioral Perspective Model (BPM), which has formed the basis of the exploration of
behavioral economics in consumer behavior analysis.
Why behavioral economics? Behavior is economic in the sense that it can be studied
as the allocation of a limited number of responses to produce an array of benefits; at the
same time, this allocation incurs costs (Staddon, 1980). This covers all that behavior
analysts study as operant choice: It is not that the behavior itself is inherently economic but
that certain tools can be brought to bear in its analysis. The benefits and costs relate
ultimately to biological fitness and are seen most graphically in the acquisition of primary
reinforcers, in the course of which Behaviorpotentially Setting Scope
fitness-­ enhancing alternatives are foregone.
But secondary reinforcers also Closed
play a central role in the Open relationship of individual conduct
to biological fitness via economic choice.CC2 CC1
Accomplishment
Operant behavior is therefore economicStatus
Fulfillment behavior in that it is the allocation of a
consumption
limited number of responses among competing CC4
alternatives. ThisCC3has become enshrined
inHedonism
definitions of rewards found
Inescapable in biology and
entertainment neuroeconomics,
Popular entertainment which cast them as
“stimuli for which an organism will work” (e.g., Rolls, 2008, pp. 118–119). Classically
conditioned behavior is not economic behavior CC6 CC5not require behavior
in this sense; it does
Accumulation Token-based consumption Saving and collecting
at all on the part of the organism and therefore there arises no conception that the
organism is expending responses in order CC8 to obtain a biologically CC7or socially relevant
Maintenance Mandatory consumption Routineeconomics
purchasing are, therefore, theories of
outcome. Both matching analysis and behavioral
behavior in general interpreted in economic terms. They lead to the conclusion that all
behavior is choice and can be analyzed in economic terms: Operant behavior is economic
behavior. To the extent that we embrace this conclusion, there is no need for a separate
subdiscipline of behavioral economics; behavioral economics would be, rather, a
technique or methodology that can be applied to all behavior analytic research.
Consumer behavior analysis has a more restricted sphere of application—human
economic and social choices that involve social exchange—and, if we are to address
what is commonly understood as economic behavior, we must delineate the subject
matter with some care. It is the understanding of exchange that is crucial to the definition
of economic behavior in this more restricted sense.
The ultimate maximand of operant/economic behavior isLow
High utilitarian reinforcement inclusive
utilitarianfitness; genetic
reinforcement
influences determine that this is met by the establishment of certain goals represented by
High informational
primary reinforcement
reinforcers, and by association, Accomplishment Accumulation
secondary reinforcers are established that have
similar effects. Genes
Low informational therefore determine
reinforcement the goals of behavior—reinforcers,
Hedonism Maintenance rather
than particular behaviors; specific appropriate instrumental behaviors are selected
environmentally through the contingent availability of primary and secondary
reinforcers.

The Behavioral Perspective Model

At the heart of consumer behavior analysis is the BPM (Foxall, 1990, 2010), which
adapts the idea of the contingencies of reinforcement and punishment to accommodate
research into the nature of human consumers’ economic and social choices (Figure 1).

Consumer Behavior Setting Utilitarian Reinforcment

Consumer Situation Utilitarian Punishment

Behavior
Informational Reinforcement
Consumer Situation

Learning History Informational Punishment

Figure 1. Summative Behavioral Perspective Model.
 Closed Open
CC2
Introduction CC1 233
Accomplishment Fulfillment Status consumption
The antecedent events that set the occasion for consumer behavior compose the
consumer CC4 CC3 temporal) and social
Hedonism behaviorInescapable
setting. This consists of all the physical (including
entertainment Popular entertainment
(including verbal) discriminative stimuli and motivating operations that signal and
enhance the likely outcomes of behaving in a particular way. Behavior
CC6 CC5 settings facilitate or
Accumulation Token-basedand
consumption Savinga and collecting from the most open (where
inhibit consumer movement choice and form continuum
numerous behavioral options are availableCC8 to the consumer and positive reinforcement
CC7
Maintenance to the
predominates) most closed
Mandatory (where few behaviors,
consumption perhaps only a single response, are
Routine purchasing
available and negative reinforcement is prevalent). The consumer’s learning history is the
cumulative effect of rewarding and punishing outcomes of past consumer choice.
Consumer behavior is shaped by three broadly defined consequences. Utilitarian
reinforcement derives from the satisfaction produced by buying, owning, and consuming
economic goods. Informational reinforcement is provided by feedback on the consumer’s
performance, especially the social status produced by conspicuous consumption. Finally,
aversive consequences are the costs of consuming: relinquishing money, waiting in line,
forgoing alternative products, and so forth. Four operant classes of consumer behavior are
defined based on the pattern of high/low utilitarian and informational reinforcement that
maintains them (Figure 2).
High utilitarian reinforcement Low utilitarian reinforcement
High informational reinforcement Accomplishment Accumulation
Low informational reinforcement Hedonism Maintenance

Figure 2. Operant classes of consumer behavior.

Maintenance consists of activities necessary for the consumer’s physical survival and
welfare (e.g., food) and the fulfillment of the minimal obligations entailed in membership of
a social system (e.g., paying taxes). Accumulation includes the consumer behaviors involved
in certain kinds of saving, collecting, and installment buying. Pleasure includes such
activities as the consumption of popular entertainment. Finally, accomplishment is consumer
behavior reflecting social and economic achievement: acquisition and conspicuous
consumption of status goods and displaying products and services that signal personal
attainment. Both types
Consumer Behavior Settingof reinforcers figure in the maintenance ofUtilitarian
each ofReinforcment
the four classes,
though to differing extents. Adding in the scope of the current behavior setting leads to the
eightfold classification depicted in Figure 3, which shows the variety of contingency
Consumer
categories that exclusively constitute Situation analysis of consumer
a functional behavior.
Utilitarian Punishment

BehaviorBehavior Setting Scope

Closed Open
Informational Reinforcement
Consumer Situation CC2 CC1
Accomplishment Fulfillment Status consumption
Learning History Informational Punishment
CC4 CC3
Hedonism Inescapable entertainment Popular entertainment
CC6 CC5
Accumulation Token-based consumption Saving and collecting
CC8 CC7
Maintenance Mandatory consumption Routine purchasing

Figure 3. The Behavioral Perspective Model contingency matrix. Note. CC = contingency category.

1. The Analysis of Product and Brand Preference

The first four papers in the special issue are concerned with consumers’ selection of
products and brands within an array of items available to them and are all concerned in
varying degrees with the suitability of the BPM as a means of conceptualizing consumer
234 Foxall and Sigurdsson

choice in operant terms. The first paper by Victoria K. Wells and Gordon R. Foxall,
“Matching, Demand, Maximization, and Consumer Choice,” embraces perennial
concerns in the quantitative analysis of behavior with the implications of matching and
maximization (Commons, Hernstein, & Rachlin, 1982), but it does so in the naturally
occurring environments of human consumer choice and with a rather different import.
To some behavioral economists, a division of labor is suggested by the fact that matching
has generally been the province of psychologists rather than economists. But there is
good reason to include matching analysis in behavioral economics. A theoretical
treatment of the apparent compatibility of matching analyses and studies of consumer
brand choice (Foxall, 1999a) concludes that matching is appropriate to the study of
human choice as economic behavior through its capacity to represent patterns of mutual
reinforcement by identifying not only what acts as a reinforcer but also how this
reinforcer is valued by the participants in an exchange. Matching analysis depicts human
exchange in terms of mutual reinforcement (between marketer and consumer) and,
through the inclusion of informational reinforcement, can incorporate socially
enforceable transfer of property rights as a consequence of transacting. More importantly,
it provides measures of economic variables such as degrees of substitutability,
complementarity, and independence, which provide means of defining brands, product
categories, and product subcategories (Foxall, James, Chang, & Oliveira-­Castro, 2010;
Foxall, James, Oliveira-­Castro, & Ribier, 2010).
In the second paper in this section, “Individual Differences in Consumer Buying
Patterns: A Behavioral Economic Analysis,” Paulo R. Cavalcanti and colleagues identify
several stable regularities in buying behavior and differences between individuals. They
form an underlying framework for personalized marketing and segmentation and integrate
this research literature into the BPM.
Valdimar Sigurdsson and colleagues, in “An Econometric Examination of the
Behavioral Perspective Model in the Context of Norwegian Retailing,” report evidence for
the role of informational reinforcement in consumer choice. This variable emerges as the
single most important influence on consumer preference, but the strongest predictor of
consumer behavior is the combination of utilitarian and information reinforcement and
price proposed by the model.
These papers embody a methodological shift from the experimental analysis of
behavior, which is particularly necessary in the realm of behavior analysis in natural
settings: It uses aggregate panel data or databanks from retailers. The last paper in this
section employs the more usual experimental method albeit in the form of a field
experiment in an online environment. Based on a recent study of consumer choice in an
e-­r etailing environment, Sigurdsson and colleagues, in “A Test of the Behavioral
Perspective Model in the Context of an E-­mail Marketing Experiment,” report a distinction
in the roles of utilitarian and informational reinforcement: Although the former is more
closely related to buying behavior, the latter is more instrumental in effecting the opening
of e-­mails in the first place.

2. Contextual Influences on Consumer Behavior

The papers in this section take consumer behavior analysis beyond the confines of
product and brand choice simpliciter. In “Gambling in the Public Marketplace: Adaptations
to Economic Context,” Charles A. Lyons examines gambling behavior in light of the
vicissitudes of economic and political turbulence. Consumer behavior can be
conceptualized along a continuum from that which is maximally under the self-­control of
the individual (e.g., adhering to self-­generated rules based on learning history) to that
which is maximally impulsive (Foxall, 2010; Foxall & Sigurdsson, 2011). The range of
behaviors stretches from everyday brand choice, much like those covered in the papers in
the opening section of this issue, through credit sales and environmental despoliation to
compulsive buying and extreme addiction, from buying small quantities that cover one’s
 Introduction 235

immediate needs to wanting it all, and now! Asle Fagerstrøm and Donald A. Hantula, in
“Buy It Now and Pay for It Later: An Experimental Study of Consumer Credit Use,”
building on the hyperbolic discounted utility model, seek to expand the behavior analytical
understanding of credit card use. Hyperbolic discounting is the tendency for people to
increasingly choose a smaller-­sooner reward (showing an impulse) over a larger-­later
reward, as the delay occurs sooner rather than later in time. Fagerstrøm and Hantula
conducted a simulated shopping experiment, and the overall results revealed tendencies to
show hyperbolic discounting as the participants were willing to pay a high interest charge
(nearly 40%) rather than waiting to save money and purchase a phone interest-­free. This
paper shows the real and applied nature of consumer behavior analysis as researchers
study a wide range of economic topics in which the main focus is the contingencies that
influence the behavior of the economic agent.
The BPM is often summarized as an elaboration of the three-­term contingency
applied to the context of economic behavior. In fact, it embraces multi-­term contingencies
and, in particular, the role of motivating operations in the enhancement of behavior–
reinforcer relationships. The paper entitled “On Motivating Operations at the Point of
Online Purchase Setting,” by Asle Fagerstrøm and Erik Arntzen, provides an overview
of this work on the impact on motivating operations at the point of online purchase
situation.
The fourth paper in this section, by Rafael Barreiros Porto and Jorge M. Oliveira-­
Castro, is titled “Say–Do Correspondence in Brand Choice: Interaction Effects of Past and
Current Contingencies.” It handles the interaction effects between current and past
contingencies. Unlike the seemingly popular view that customers are nothing more than
marionettes, where consumer behavior is prompted by the current environment, this paper
reminds us that generally the relevant environment is yesterday’s. This article examines
possible relations between what consumers say about the brands they bought last and they
intend to buy, which is a way of measuring part of their learning history with brands, and
their actual purchases, taking into account the programmed reinforcement contingencies
(marketing strategies) at the point of sale. Results showed, in general, that current and past
contingencies interact and have different impacts on say–do correspondence, which can be
explained by the BPM. According to the authors, behavior prediction can be enhanced if
the effects of brands that consumers “bring” to the shopping environment are combined to
brand-­related strategies present in the retailing environment. This research provides
interesting findings to the consumer behavior analytical literature and an efficient
methodology, taking into account past contingencies, when using in-­store experiments to
test the influences of behavioral contingencies predicted by the BPM.
The last paper, “Consumer Behavior Analysis of Fair Trade Coffee: Evidence From
Field Research,” written by Jeanine P. Stratton and Matt J. Werner reveals the results
from their in-­store field study where they examined consumer purchase behavior of Fair
Trade–labeled coffee in a coffee shop. This study continues the recent upsurge of in-­
store experimentation where researchers work on the functional relationships between
factors within the marketing mix (e.g., promotions, placements, pricing) and consumer
behavior at the point of purchase, or POP, as it often called (Sigurdsson, Engilbertsson,
& Foxall, 2010; Sigurdsson, Foxall, & Saevarsson, 2010; Sigurdsson, Larsen, &
Gunnarsson, 2011a, 2001b; Sigurdsson, Saevarsson, & Foxall, 2009). This research has
dealt with applications to problematic consumer behaviors of social interest, as promoted
by Baer, Wolf, and Risley (1968) in their influential paper. The current paper is no
exception to this. The study assessed the impact of two experimental conditions, low-
and high-­i nformation POP label conditions promoting Fair Trade coffee availability, and
the service time. The finding suggested consumer preference for Fair Trade over non–
Fair Trade coffee types across all conditions. Coffee shops could use similar POP
advertisements to promote their sales, provided price is similar between Fair Trade and
non–Fair Trade coffee selections.
236 Foxall and Sigurdsson

3. Beyond Consumer Choice: The Behavior of the Firm

A major deficiency in economic psychology and marketing science is the lack of a
common framework in which to discuss the behavior of consumers and the behavior of
firms. The BPM suggests an obvious extension to the corporate field (Foxall, 1999b),
which seeks to interpret business conduct as operant responses that are shaped by the
known reactions of consumers. Marketing activity is thus understood in terms of the
attempt to reduce the scope of the consumer behavior setting and to influence consumer
choice through the judicious management of the pattern of reinforcement contingent
upon purchase and consumption (Vella & Foxall, 2011). Kevin J. Vella and Gordon R.
Foxall, in “The Marketing Firm: Operant Interpretation of Corporate Behavior,” used
data from the reports of the United Kingdom Competition Commission to examine this
interpretation.
The collective aim of the papers introduced is to enlarge the capacity of behavior
analysis to elucidate human activity in natural settings, with the aim of demonstrating
that a behaviorist understanding can be provided for human economic behavior, and
furthermore that behavior analysis can be used to modify consumer behavior. We have
therefore argued for consumer behavior analysis as an integral component of applied
behavior analysis. The unifying framework for this research is the BPM, which has
formed the basis of the exploration of behavioral economics in consumer behavior
analysis.

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