Zhongmin Wang:
In a new RFF discussion paper, “Egregiousness and Boycott intensity: Evidence from the BP Deepwater Horizon Spill,” we ... explore the relationship between boycott intensity and media coverage, due to the latter’s ability to influence consumer awareness about egregious events.
In order to test our model empirically, we turned to data collected during the Deepwater Horizon oil spill. The spill represents a single significant event—but its egregiousness changed over time based on reported levels of leaking oil. It also provided us with an easy way to conceptualize the distinction between egregiousness levels and consumer perceptions—the oil spill’s overall severity didn’t change after it was stopped, but consumers’ negative feelings of the event declined over time. Using our market-level model, we determined an area’s boycott intensity by measuring decreases in BP brand’s market share across 257 US counties.
We expected that the oil spill, at any given level of egregiousness, would have caused greater harm in markets closer to the Gulf Coast region and in markets with stronger environmental preferences—a hypothesis that was confirmed by our model. Our findings also indicated that while drivers boycotted BP gasoline as the oil spill was occurring and that boycott intensity increased with the official flow rate, this pattern disappeared quickly after the spill was stopped. In terms of the media’s influence on consumers, boycott intensity appeared to increase with the weekly number of spill-related news hits, suggesting that consumers may have made assumptions about the seriousness of the spill due to the intensity of the media coverage it received at any given time.
