IDEAS home Printed from https://ideas.repec.org/a/gam/jsusta/v12y2020i23p9870-d451054.html
   My bibliography  Save this article

Analysing Consumer Preferences, Characteristics, and Behaviour to Identify Energy-Efficient Consumers

Author

Listed:
  • Janez Dolšak

    (School of Economics and Business, University of Ljubljana, 1000 Ljubljana, Slovenia)

  • Nevenka Hrovatin

    (School of Economics and Business, University of Ljubljana, 1000 Ljubljana, Slovenia)

  • Jelena Zorić

    (School of Economics and Business, University of Ljubljana, 1000 Ljubljana, Slovenia)

Abstract

This paper investigates preference heterogeneity among Slovenian energy consumers and attempts to ascertain how different consumer groups value various attributes of energy products and services. More specifically, it aims to establish whether a consumer segment can be identified that shows a preference for additional energy services—in particular services, associated with energy-efficient and green behaviour. A latent class analysis is employed to classify consumers on the basis of their preferences for energy services. Additionally, information about their attitudes and behaviour toward green energy and energy efficiency, energy consumption, and usage of energy services together with socio-economic characteristics is used in the latent class regression to explain differences between latent consumer classes. Three classes are identified: the largest class of regular consumers, energy-efficient consumers, and dissatisfied consumers. In contrast to regular and dissatisfied consumers, energy-efficient consumers show a significantly higher interest in additional services, energy efficiency, and green energy. In line with the found heterogeneity of consumer preferences, suppliers should customise marketing strategies to meet the needs of specific segments. Energy policymakers also need to pay more attention to consumer heterogeneity and behavioural changes to increase the effectiveness of energy efficiency policies.

Suggested Citation

  • Janez Dolšak & Nevenka Hrovatin & Jelena Zorić, 2020. "Analysing Consumer Preferences, Characteristics, and Behaviour to Identify Energy-Efficient Consumers," Sustainability, MDPI, vol. 12(23), pages 1-19, November.
  • Handle: RePEc:gam:jsusta:v:12:y:2020:i:23:p:9870-:d:451054
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2071-1050/12/23/9870/pdf
    Download Restriction: no

    File URL: https://www.mdpi.com/2071-1050/12/23/9870/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Belaïd, Fateh & Roubaud, David & Galariotis, Emilios, 2019. "Features of residential energy consumption: Evidence from France using an innovative multilevel modelling approach," Energy Policy, Elsevier, vol. 125(C), pages 277-285.
    2. Huh, Sung-Yoon & Jo, Manseok & Shin, Jungwoo & Yoo, Seung-Hoon, 2019. "Impact of rebate program for energy-efficient household appliances on consumer purchasing decisions: The case of electric rice cookers in South Korea," Energy Policy, Elsevier, vol. 129(C), pages 1394-1403.
    3. Barr, Stewart & Gilg, Andrew W & Ford, Nicholas, 2005. "The household energy gap: examining the divide between habitual- and purchase-related conservation behaviours," Energy Policy, Elsevier, vol. 33(11), pages 1425-1444, July.
    4. Belaïd, Fateh & Garcia, Thomas, 2016. "Understanding the spectrum of residential energy-saving behaviours: French evidence using disaggregated data," Energy Economics, Elsevier, vol. 57(C), pages 204-214.
    5. Walker, Joan & Ben-Akiva, Moshe, 2002. "Generalized random utility model," Mathematical Social Sciences, Elsevier, vol. 43(3), pages 303-343, July.
    6. Daniel McFadden, 1986. "The Choice Theory Approach to Market Research," Marketing Science, INFORMS, vol. 5(4), pages 275-297.
    7. Jonas Schmidt & Tammo H. A. Bijmolt, 2020. "Accurately measuring willingness to pay for consumer goods: a meta-analysis of the hypothetical bias," Journal of the Academy of Marketing Science, Springer, vol. 48(3), pages 499-518, May.
    8. Ndebele, Tom & Marsh, Dan & Scarpa, Riccardo, 2019. "Consumer switching in retail electricity markets: Is price all that matters?," Energy Economics, Elsevier, vol. 83(C), pages 88-103.
    9. Hartmann, Patrick & Apaolaza Ibanez, Vanessa, 2007. "Managing customer loyalty in liberalized residential energy markets: The impact of energy branding," Energy Policy, Elsevier, vol. 35(4), pages 2661-2672, April.
    10. Ohler, Adrienne M. & Billger, Sherrilyn M., 2014. "Does environmental concern change the tragedy of the commons? Factors affecting energy saving behaviors and electricity usage," Ecological Economics, Elsevier, vol. 107(C), pages 1-12.
    11. Gilles Celeux & Gilda Soromenho, 1996. "An entropy criterion for assessing the number of clusters in a mixture model," Journal of Classification, Springer;The Classification Society, vol. 13(2), pages 195-212, September.
    12. Stefania Troiano & Daniel Vecchiato & Francesco Marangon & Tiziano Tempesta & Federico Nassivera, 2019. "Households’ Preferences for a New ‘Climate-Friendly’ Heating System: Does Contribution to Reducing Greenhouse Gases Matter?," Energies, MDPI, vol. 12(13), pages 1-19, July.
    13. Achtnicht, Martin & Madlener, Reinhard, 2014. "Factors influencing German house owners' preferences on energy retrofits," Energy Policy, Elsevier, vol. 68(C), pages 254-263.
    14. Soyoung Yoo & Jiyong Eom & Ingoo Han, 2020. "Factors Driving Consumer Involvement in Energy Consumption and Energy-Efficient Purchasing Behavior: Evidence from Korean Residential Buildings," Sustainability, MDPI, vol. 12(14), pages 1-23, July.
    15. Pothitou, Mary & Hanna, Richard F. & Chalvatzis, Konstantinos J., 2016. "Environmental knowledge, pro-environmental behaviour and energy savings in households: An empirical study," Applied Energy, Elsevier, vol. 184(C), pages 1217-1229.
    16. Frederiks, Elisha R. & Stenner, Karen & Hobman, Elizabeth V., 2015. "Household energy use: Applying behavioural economics to understand consumer decision-making and behaviour," Renewable and Sustainable Energy Reviews, Elsevier, vol. 41(C), pages 1385-1394.
    17. McDaniel, Tanga M. & Groothuis, Peter A., 2012. "Retail competition in electricity supply—Survey results in North Carolina," Energy Policy, Elsevier, vol. 48(C), pages 315-321.
    18. Alberini, Anna & Bigano, Andrea & Boeri, Marco, 2013. "Looking for Free-riding: Energy Efficiency Incentives and Italian Homeowners," Energy: Resources and Markets 148896, Fondazione Eni Enrico Mattei (FEEM).
    19. Kaenzig, Josef & Heinzle, Stefanie Lena & Wüstenhagen, Rolf, 2013. "Whatever the customer wants, the customer gets? Exploring the gap between consumer preferences and default electricity products in Germany," Energy Policy, Elsevier, vol. 53(C), pages 311-322.
    20. Wustenhagen, Rolf & Bilharz, Michael, 2006. "Green energy market development in Germany: effective public policy and emerging customer demand," Energy Policy, Elsevier, vol. 34(13), pages 1681-1696, September.
    21. Bolck, Annabel & Croon, Marcel & Hagenaars, Jacques, 2004. "Estimating Latent Structure Models with Categorical Variables: One-Step Versus Three-Step Estimators," Political Analysis, Cambridge University Press, vol. 12(1), pages 3-27, January.
    22. Cherry, Todd L. & McEvoy, David M. & Westskog, Hege, 2019. "Cultural worldviews, institutional rules and the willingness to participate in green energy programs," Resource and Energy Economics, Elsevier, vol. 56(C), pages 28-38.
    23. Ek, Kristina & Söderholm, Patrik, 2010. "The devil is in the details: Household electricity saving behavior and the role of information," Energy Policy, Elsevier, vol. 38(3), pages 1578-1587, March.
    24. Peter Boxall & Wiktor Adamowicz, 2002. "Understanding Heterogeneous Preferences in Random Utility Models: A Latent Class Approach," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 23(4), pages 421-446, December.
    25. Sütterlin, Bernadette & Siegrist, Michael, 2017. "Public acceptance of renewable energy technologies from an abstract versus concrete perspective and the positive imagery of solar power," Energy Policy, Elsevier, vol. 106(C), pages 356-366.
    26. Fonseca, Jaime R.S., 2009. "Customer satisfaction study via a latent segment model," Journal of Retailing and Consumer Services, Elsevier, vol. 16(5), pages 352-359.
    27. Yang, Yingkui, 2014. "Understanding household switching behavior in the retail electricity market," Energy Policy, Elsevier, vol. 69(C), pages 406-414.
    28. Linzer, Drew A. & Lewis, Jeffrey B., 2011. "poLCA: An R Package for Polytomous Variable Latent Class Analysis," Journal of Statistical Software, Foundation for Open Access Statistics, vol. 42(i10).
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Ihwan Ghazali & Salwa Hanim Abdul-Rashid & Siti Zawiah Md Dawal & Nurul Huda & Amir Husni Mohd Shariff & Safarudin Gazali Herawan & Fu Haw Ho & Novita Sakundarini, 2021. "Guidelines for Designing Green Products Considering Customers’ Cultural Preferences," Sustainability, MDPI, vol. 13(2), pages 1-27, January.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Belaïd, Fateh & Joumni, Haitham, 2020. "Behavioral attitudes towards energy saving: Empirical evidence from France," Energy Policy, Elsevier, vol. 140(C).
    2. Tampakis, Stilianos & Arabatzis, Garyfallos & Tsantopoulos, Georgios & Rerras, Ioannis, 2017. "Citizens’ views on electricity use, savings and production from renewable energy sources: A case study from a Greek island," Renewable and Sustainable Energy Reviews, Elsevier, vol. 79(C), pages 39-49.
    3. Trotta, Gianluca, 2018. "Factors affecting energy-saving behaviours and energy efficiency investments in British households," Energy Policy, Elsevier, vol. 114(C), pages 529-539.
    4. Kabeya Clement Mulamba, 2020. "Relationship between education and households? electricity-saving behaviour in South Africa: A multilevel logistic analysis," ECONOMICS AND POLICY OF ENERGY AND THE ENVIRONMENT, FrancoAngeli Editore, vol. 2020(2), pages 51-74.
    5. Park, Eunil & Kwon, Sang Jib, 2017. "What motivations drive sustainable energy-saving behavior?: An examination in South Korea," Renewable and Sustainable Energy Reviews, Elsevier, vol. 79(C), pages 494-502.
    6. Fiorillo, Damiano & Sapio, Alessandro, 2019. "Energy saving in Italy in the late 1990s: Which role for non-monetary motivations?," Ecological Economics, Elsevier, vol. 165(C), pages 1-1.
    7. Ndebele, Tom & Marsh, Dan & Scarpa, Riccardo, 2019. "Consumer switching in retail electricity markets: Is price all that matters?," Energy Economics, Elsevier, vol. 83(C), pages 88-103.
    8. Hussain, Shahid & Seet, Pi-Shen & Ryan, Maria & Iranmanesh, Mohammad & Cripps, Helen & Salam, Abdul, 2022. "Determinants of switching intention in the electricity markets - An integrated structural model approach," Journal of Retailing and Consumer Services, Elsevier, vol. 69(C).
    9. Morgane Innocent & Agnès François-Lecompte & Nolwenn Roudaut, 2020. "Comparison of human versus technological support to reduce domestic electricity consumption in France," Post-Print hal-02450849, HAL.
    10. Lehmann, Nico & Sloot, Daniel & Schüle, Christopher & Ardone, Armin & Fichtner, Wolf, 2023. "The motivational drivers behind consumer preferences for regional electricity – Results of a choice experiment in Southern Germany," Energy Economics, Elsevier, vol. 120(C).
    11. Fang, Xingming & Wang, Lu & Sun, Chuanwang & Zheng, Xuemei & Wei, Jing, 2021. "Gap between words and actions: Empirical study on consistency of residents supporting renewable energy development in China," Energy Policy, Elsevier, vol. 148(PA).
    12. Sylwia Słupik & Joanna Kos-Łabędowicz & Joanna Trzęsiok, 2021. "Energy-Related Behaviour of Consumers from the Silesia Province (Poland)—Towards a Low-Carbon Economy," Energies, MDPI, vol. 14(8), pages 1-23, April.
    13. Hurtubia, Ricardo & Nguyen, My Hang & Glerum, Aurélie & Bierlaire, Michel, 2014. "Integrating psychometric indicators in latent class choice models," Transportation Research Part A: Policy and Practice, Elsevier, vol. 64(C), pages 135-146.
    14. Spandagos, Constantine & Yarime, Masaru & Baark, Erik & Ng, Tze Ling, 2020. "“Triple Target” policy framework to influence household energy behavior: Satisfy, strengthen, include," Applied Energy, Elsevier, vol. 269(C).
    15. Jin Zhang & Lianrui Ma & Jinkai Li, 2021. "Why Low-Carbon Publicity Effect Limits? The Role of Heterogeneous Intention in Reducing Household Energy Consumption," Energies, MDPI, vol. 14(22), pages 1-17, November.
    16. Innocent, Morgane & Francois-Lecompte, Agnès, 2018. "The values of electricity saving for consumers," Energy Policy, Elsevier, vol. 123(C), pages 136-146.
    17. Shin, Kong Joo & Managi, Shunsuke, 2017. "Liberalization of a retail electricity market: Consumer satisfaction and household switching behavior in Japan," Energy Policy, Elsevier, vol. 110(C), pages 675-685.
    18. Innocent, Morgane & Francois-Lecompte, Agnes & Roudaut, Nolwenn, 2020. "Comparison of human versus technological support to reduce domestic electricity consumption in France," Technological Forecasting and Social Change, Elsevier, vol. 150(C).
    19. Haghani, Milad & Bliemer, Michiel C.J. & Hensher, David A., 2021. "The landscape of econometric discrete choice modelling research," Journal of choice modelling, Elsevier, vol. 40(C).
    20. Muhammad Yaseen Bhutto & Xiaohui Liu & Yasir Ali Soomro & Myriam Ertz & Yasser Baeshen, 2020. "Adoption of Energy-Efficient Home Appliances: Extending the Theory of Planned Behavior," Sustainability, MDPI, vol. 13(1), pages 1-25, December.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jsusta:v:12:y:2020:i:23:p:9870-:d:451054. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.