The Main Components of the SMC Framework

The BPM is adopted since its components have been conceptualised (Foxall 1990, 1997b, 1999b), operationalized, and applied in empirical research (Vella and Foxall 2011) to offer an operant interpretation of the situational influences on firm marketing behaviour. In the same fashion as the three-term contingency, BPM relates the behaviour of unique individuals in interaction with their environments to the consequences these repertoires produce. The model also emphasises the signalling and motivational function that antecedent

environmental stimuli perform and the classes of associated behavioural emissions given a unique learning history of the individual. At this stage, reliance is made on the theoretical development of the BPM for purchase and consumption because this area enjoys greater theoretical development and application in research.

193 An abridged version of this chapter appears in Vella (2015).

The logic underlying the Marketing Firm perspective emphasises three important dimensions.

First, if situational influences do also matter in determining differences among firms (e.g., Hagström and Chandler Jr 1998), then a systematic and rigorous approach that combines economics and operant psychology provides an alternative route to shed light on the role played by the external market environment in determining the patterns of adaptive corporate practices of individual firms and the distribution of adapted practices among a given

population of firms. However, outside the highly controlled experimental space and with the use of qualitative data it is extremely difficult to identify

contingencies, to disentangle their elements, and to establish the interrelationships among variables so precisely as to demonstrate

environmental control on behaviour (Foxall 1990, 2010b). Thus, attributing control and uncovering the gradual and successive sequences in which the environment shapes, maintains, weakens, and extinguishes behaviour with the same valid and reliable (scientific) precision as experimental procedures is not possible. The application of the BPM to render an operant interpretation of marketing practices within the theoretical framework of the Marketing Firm (Foxall 1999b; Vella and Foxall 2011) allows the generation of research propositions and apposite operational definitions and qualitative measures to validly and reliably identify the ways in which the various elements composing real world market environments operate independently and in combination on the strategic practices of firms. Thus, the research proceeds on qualitatively demonstrating operant conditioning or otherwise.

Second, within evolutionary economics, treatments of the firm focus almost exclusively on the production or supply side (Valente 2012; Vromen 2012) while assuming “an extremely sketchy representation of markets’ internal functioning” and lacking a generalised framework for modelling and researching consumer behaviour in the real world (Valente 2012, p. 1030). This results in a relatively static characterisation of the behaviour of firms because it neglects customers, the “key stakeholder” which calls the firm “into existence and rationalises the use of its resources” (Foxall 1999b, p. 211). Evolutionary

perspectives reject static models in favour of dynamics, disequilibrium, change, and heterogeneity and, by definition, place importance on environmental

interaction (Nelson and Winter 1982; Marengo and Willinger 1997; Nelson and Winter 2002; Dosi and Marengo 2007; Dosi 2013; Nelson 2013). Therefore, a simultaneous examination of both supply and demand is required when

understanding the natural selection dynamics within a particular market. Nelson (2013), for example, argues for developing an evolutionary price theory where demand shares common assumptions with supply and, thus, their interaction within markets may be carefully and more realistically examined. It is also surprising that with its special emphasis on heterogeneous firms, technological advance, dynamics, novelty, and innovation, evolutionary economics maintains an understanding of the factors involved in the allocation of resources and in the supply of the right product mix for purchase and consumption which is devoid of any substantive treatment of non-price marketing dimensions (Nelson 2013). Thus, what of the special functions of branding, advertising, and

salesmanship? What of the symbolic rewards and sanctions of consumer behaviour?¹⁹⁴ What of firm strategies that tap into these dimensions to create and nourish demand?

The Marketing Firm (Foxall 1999b) provides an operant interpretation of behaviour of the firm to complement that developed on purchase and

consumption behaviours (Foxall 1990, 1997b, 2001, 2005, 2007a). Since both interpretations share a common conceptual framework, the BPM, purchase and consumption behaviour and marketing practices may be integrated to

investigate and understand the nature of their interrelationship (Foxall 1990, 1994, 1997a, 1999b, 2001; Vella and Foxall 2011). In addition, since the BPM is an elaboration of the three-term contingency, it is a selectionist model

assuming Selection by Consequences (Foxall 1996b, 2010b, c). The model also reorients the discussion on situational influences away from simple

considerations of changes in price (elasticity) towards a focused analysis of the

194 See, for example, Witt (2010) and Foxall (2013).

dynamic changes in all or any of the elements of the marketing mix, i.e., the plasticity of consumer behaviour (Foxall and Schrezenmaier 2003)¹⁹⁵.

Third, the primary emphasis the Marketing Firm awards to profitable literal exchange and to marketing (Foxall 1999b; Vella and Foxall 2011, 2013) in conjunction with the focus on the market environment as a selective system allows a novel interpretation of marketing practices as socio-economic

emissions that contribute to the resolution of the perpetual quandary (and moving target) that is posited by the market as the selective system. In addition, the concept of bilateral contingencies within the Marketing Firm

provides the necessary analytical framework to examine reciprocal and mutually reinforcing social and literal exchange relations (Foxall 1999b; Vella and Foxall 2011, 2013) and environmental interaction.