Recent Researches in Economics

Green Consumer Behavior:

Empirical Study of Swedish Consumer Behavior
USAMA AWAN
Department of Management Sciences
COMSATS Institute of Information Technology
Mailsi road, off Multan road, Pir Murad, Vehari
PAKISTAN
E-mail: [email protected]

MUHAMMAD AMER RAZA

School of Sustainable Development of Society and Technology, Malardalen University,
Box 883,721 23 Vasteras, Sweden
E-mail: [email protected]

Abstract: -. This study provide a better opportunity to examine how environmental issues are important in
consumer decision making process and what are the important factors that affecting the consumers while taking
decision towards electricity providing company. Every human adopt different activities to live happy on this
planet and takes different measures to protect the environment. Companies in turn study and identify the
behavior and start target products manufactured according to the consumer behavior.
This research paper starts by presenting the background information of Swedish energy market, and then
presents concepts and theories of consumer behavior in literature review. In conceptual frame work authors
adopt consumer decision model. Data collected through self administrated questionnaires and quantitative
research method is used to analysis the results. Primary data collected through questionnaire. Survey result
shows that consumers are willing to pay more for environment sustainability but perceive that the price of
green energy is higher than conventional energy. To develop awareness in consumers mind; companies should
use advertisement and positioned themselves as a socially responsible and environmentally with competitive
prices. Research proves that when consumer makes decision he does not consider only the product but he also
keeps other factors in mind. He takes influence from society and interprets information as he receives from
different sources. The study concludes by outlining the theoretical and practical implications are also for the
marketers.
Key-Words: Green purchase behavior, consumer decision, green energy, environmental Concern,
environmental knowledge.

1 Introduction environment is to adopt harmless production process

and more emphasize should put for using of eco-
The world is currently facing the environmental labeling on products [4].
sustainability problems and environmental issues
influencing and changing the consumptions patterns In order to meet the growing energy demands and
of human life and activities on this planet. It has save the planet from being defaced and poisoned,
become the priority to educate the consumers about nations all over the worlds are seriously turning
the sustainability of the environment and to reduce towards natural renewable energy systems. Green
green houses gas emission [1]Fossil fuels the energy is, thus, considered an extremely important
conventional energy sources are not only running aspect in safeguarding the planet as livable for the
out at a dangerous pace but also give off tons of generations [2].
pollution [2]. As the energy market is restructured in Sweden in
The finite natural resources of this planet have 1996 since then competition is high among the
created a confronting challenge for the inhabitants different energy companies and this competition [5]
of this planet to develop such a mechanism to created challenged for existing and new companies
protect and preserve for their future generations [3] (Gerpott and Mahmudova, 2010) in order to
The preferred mechanism for protecting the natural increase efficiency among the suppliers and to

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reduce the retail prices [6]. Low prices in energy government abolished a number of regulatory
market will allow the consumer to choose the barriers for energy producers. Since Swedish
energy company and consumer will make decision electricity market has become open for competition,
in purchasing the energy depends on environmental it provides the consumer to choice and contract with
products [5]. any energy company resulting in increased trade of
energy [9].
Traditional energy products will replace the
traditional brown power products as people behavior
and attitude continue to change due environmental 1.4 The Role of Green Energy in Sweden
movements towards the sustainability of the Green energy is playing a vital role in development
environment[7] environmental friendly power or of country economy. Sweden has achieved a low
renewable electricity defined as electricity generated level of carbon dioxide (CO2) emissions and
through eco-friendly or sustainable ways includes heading towards a low carbon economy in Nordic
solar, hydro, and bio-energy or biomass [8]. region The Swedish government has also started to
1.1 Aim of research issue Renewable Electricity Certificate (REC) for
encouraging the producers of electricity to produce
The aim of this research work is to investigate the electricity through renewable energy sources [10].
consumer behavior towards the green energy and
study how consumers take environmental and other The government has set target to achieve 25TWh
factors in consideration when making choices on (terawatt-hours) energy to be produced by the end of
buying the electricity from the energy companies. year 2020. According to the website, Sweden will
For the purpose authors will put more focus on produce 51% of electricity through Renewable
studying consumer behavior of energy users Energy Sources (RES) by the end of the year 2010.
particularly in Västerås and Eskilstuna, Stockholm The government wants to promote efficient and
and some other cities of Sweden. Further authors sustainable energy use and a cost-effective energy
will examine which strategies, electricity companies supply that would facilitate the transition to an
can use in the current as well as in the new market. ecologically sustainable society . Electricity
1.2 Research Question consumption in Sweden is 17,000 KWh per person
per year which makes it the 4th largest country in
After 1996 when the deregulation of electricity act world with biggest consumption [10].
was promulgated electricity market in Sweden
became open for competition. Increasing A customer can choose a number of different
environmental movements and customers concerns agreements for the supply of electricity from
environment related issues led the companies to different electricity producer. Demographic factors
change their usual business practices and focus on are not affected on consumers in witching the
the new activities [5] However, the present energy electric supplier, consumers has weak switching
market is dominated by companies producing intentions because their electric supplier providing
electricity from conventional resources. In this services and low cost electricity [11]. Hence as [12]
scenario, green electricity companies are working Price factor is dominated in all decision making and
hard to compete on equal grounds. What are the is key determinant factor in choosing the electricity
main factors that influence consumers in their supplier but this factor is not primary motive for the
choice of green energy company over the consumers to switch from the current electric
conventional energy ? supplier to another.
1.3 Introduction to the Sweden Energy Market Customers can also switch from one electric
supplier to another supplier. Swedish households
The Sweden energy market1 was restructured in behavior regarding changing the electricity supplier
1992; sales and production of electricity were has increased during the last few years [13].
separated. Svenska Kraftnät is acting as transmission Moreover public administrative bodies and
system operator in Sweden. Deregulations of municipalities in Sweden have established contracts
electricity act were come into force on January 01, to use Eco-label electricity [14].
1996 which made possible to trade and produce
electricity competitively. Through this act, 2 Conceptual Framework
2.1 Green Marketing and Corporate social
responsibility
1
Energy Market is to be read as Electricity Market

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Green marketing is defined by [15] a responsible Several studies like [12];[33];[4];[34];[7];[35] and
organization activity to minimize ecological [36] and others have researched and analyze the
problems for sustainable development [16 consumer green energy purchasing behavior.
]concerned with educate the consumers about
The field of consumer behavior covers a lot of
environmental effects [17] used for enhancement of
different areas. [37] define consumer behavior as
the consumer interest [18] organizational activities
studies concerning attitudes, intentions and
designs to protect the individual and society
decision processes in order to explain and predict
concerned about the environmental affect.
behavior . [37] Defines attitude an individual
Environmental consumerism is defined as particular trait who behaves and sees the world
Consumers notice ecology concerns and trying to according to his own preset favorable or
protect themselves and this planet buying more unfavorable manner?
products that have no ecology effect in production
[19] Defines green consumer as those actively seek
process and leaving other products in shelves [19]
and support those products satisfy their needs that
Marketer should look at the green products that are
are having less impact on environment [38] all
positioned on the consumer as they seek the target
consumers are potentially green consumers. When a
customer [20].
consumer has choice to buy from two identical
According to [21] consumer would like to buy those products, the consumer will prefer to buy
products which are environmentally friendly. environmentally friendly product. [33] suggest that
Consumers need awareness about the clear benefits there is no significant relation between gender and
of the products. Marketers should be careful while green behavior .However in turn research of [39]
using mode of communication that matched with the found that women are generally more
beliefs and behavior of the consumers and positively environmentally conscious and willing to buy green
linked to create interest in the product [22] green products.
communication provides the verifiable claims about
[33] states that research shows that income and
the product.
environmental education have positive relationship
2.2 Ecolabel and direct impact on green behavior. [40]; [18]
investigate a parallel relation is associated with
Swedish Society for Nature Conservation (SSNC)
education and environmental consciousness. [4];
introduced electricity ecolabeling in 1996 labelled
[34] Discovered a positive relationship between
Bra Miljöval Good Environmental Choice [23]
environmental knowledge and level of a education.
[24] suggested that companies can create
Whereas [41] found that there is no correlation exit
competitive advantage if they use innovations
between educating the consumers and
related to environmental sustainability rather than
environmental issues [42] demonstrate a negative
simply comply with the government regulations.
relationship.
[25] Environmental labels make ease consumer to
identify the product is environmentally friendly [26] According to [21] distinct market segments like,
eco-label is positively correlated with consumer demographic variables such as age, income and
willingness to purchase [27] studies indicated that education are positively related to the consumer
eco-label does not motivate consume to purchase attitude in environmental [43] research show that
green product Significant influence of eco-labeled younger individuals are likely to become sensitive
information on recycling behavior [28]. to environmental issues . Young consumers in any
market constitute as a heavy-spending segments
[29] Study communicate brand image between
[44] Most of the researchers studies shows that
buyer and sellers [30] consumer make purchase
younger individuals show a greater propensity to
decision with less effort and time. [31] investigate
adopt a more Environmentally-friendly behavior
eco-labelling as a green marketing tool is not
and difficult to establish relation between gender
effective under certain conditions. According to [32]
and green consumption [45].
green power products are generally produced by use
fo the natural resource like wind, solar or [46] Pointed out that the existence of
geothermal [33]the product totally or partially environmentally conscious consumers in food
created from recyclable materials products packaged with recycled materials has
created a demand in niche markets for green power.
2.3 Green Consumer Behavior
A consumer, who is knowledgeable about
environment, will tend to make green purchase

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[47] Most of consumer perceived that Green to choose a new electric supplier [57] Consumer s
products are high price and low in quality [17]; [48] decisions influence by the media, as a stakeholder,
Product perception is influenced by situational the role of media cannot be ignored; it is the only
variables and social reference groups[21]. source through which a consumer received much of
environmental related information. [19] Consumers
[49] study that consumer willingness to pay more
become more suspicious towards those firms that
for environment friendly products and his concern
stress more environmental theme in their
for pollution and recycling forms his attitude as a
communication. Thus, a firm should design strategy
Green buying behavior . A number of researcher
carefully for the long term [58]. Environmentally
have studied the consumer behavior willingness to
friendly communication form consumer attitude
pay for green electricity in many countries [7]; [35].
purchasing the green products[59]and use of product
Surveys showed that the European consumers are labeling in advertising some time influence on
interested in green products and willingness to pay consumer[60].Where as [61] it may or may not
for green features. Owing to consumers green affect the consumer purchasing decision.
concerns, 92% of European multinationals has
[49] Defines reference group as A reference group
adopted environmental sustainability programs [50].
is a person or a group that influences another
Accordingly, different [51];[52];[53];[54];[55] were person s decision . Reference groups have important
undertaken studies to determine the younger s role in spreading of information about the product
influence on the purchase decision and found that and have influence on behavior. People in groups
adolescent consumers have substantially influence make decision collectively rather than individually.
on the buying decision of their family. Consumer in a group likes to inform others about
[19] support that a green consumer can be motivated the positive and negative features of the green
by providing an added benefit in product either a product [37].
cost effective or a environmentally friendly solution. 3 Consumer Decision Process
[47] states that consumer behavior can be developed
by highlighting the relative advantage of Greener According to [13] changing the electricity supplier
Products as compared with the other products that behavior in Swedish household has increased during
creates environmental problems. [37] further states the last years. Sweden Government deregulated
that behavior of the consumer can be changed and electricity market in 1996. Large numbers of
modified if company speaks desirable benefits or countries have deregulated their electricity market
features of product or services that matched with the allowing house hold customers freedom to choose
consumer belief in his advertising or other any electricity supplier that are connected to the
communication. A firm engaged in the cause related grid. So product differentiation became a potentially
marketing because of its long term benefits i.e. important strategy to attract consumers.
Attract and retain consumer for longer period of Many researchers [4];[62] have suggested that
time. In such type of marketing activity, consumers environmental concerns have become important
are emotionally motivate to take part and because issues in every society that increased the intention of
they wanted to feel different from other members of prospect consumer to buy Energy Efficiency (EF)
society or in their groups Ottman [19]. products and those consumer who are more
[19] is in the opinion that Habits are decided early environmentally conscious are showing more
in life children will make better decision if they willingness to engage in Energy Efficiency
start educate at an early age. Peattie is in the view consumer behavior.
that the companies should put more focus on [63] has suggested that consumer purchase decision
rewarding schemes in early stages of habit help the marketers to design the marketing mix to
formation of consumer [47]. achieve the target of sustainability and provide the
[56] explained that consumer wanted to know about criteria that the product system must be compatible
the particular and specific information about the with ecosystems . [63] further stated that
product or service which they about to buy are Customers must learn to base their purchase
environmentally friendly. Through advertisements decision not only on how well products satisfy
on radio, on billboards & in print media, are individual needs but also on how these products
making aware the consumers about the affect the natural environment .
environmental issues by the green companies along [64] Suggested that consumer will repeat purchase if
with price that has substantial effect on consumers the outcome of purchase and consumption would be

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rewarding. On the other side [19] emphasized, when (ii).Purchasing outcome, the final outcome of the
consumers make decision to buy the action (Fuller 1999, p.322).
product/service, evaluate products not only on
3.1.3 Post Purchase Behavior
performance and price, but also on the social
responsibility of manufacturers . The consumer post purchase behavior is particular
imported in sustainable market as follow:
Information and knowledge consumer received from
environment, affect in their decision making 3.1.4 Avoiding Dissonance
process. Society (As reference group) and Fuller (1999, p.233) describes when the purchase is
communication (usually received from media) are less than satisfactory for whatever reasons, it creates
formed their attitude towards the product or service a state of tension called post purchase dissonance.
[38]. The research findings of various researchers Post purchase dissonance is basically an after
are presented in the table 1. Show variable links purchase cognitive behavior. Kreidler, & Joseph,
With Green Purchase Behavior: Correlations and (2009) explained that people react in two different
environmental behavior. ways toward environment, Approach and
[65] Divides the innovation into three categories. Avoidance behavior . In approach behavior people
Process innovations are those innovations good or shows positive behaviors to stay, keep searching for
service can be produced with less input. Second the the product, power to spend money and look into
Product innovations are those innovations that particular environment. On the other side Avoidance
require improvements or developments in goods or includes negative behavior is attached, exhibiting to
services and finally Organizational innovations are leave from a particular situation.
those which include new forms of management, e.g.
4 Conceptual Model
total quality management. In medium degree of
innovation, however, exiting product is required to Authors have developed the following conceptual
be introduced in new format. The main motive is to model based on the frame of reference discussed in
attached with the ecological needs it is hardly literature. Authors of this model will describe what
express and not recognized by the consumer at all. factors are influences on consumer in his decision
[63]. making behavior towards the ecology problems.
These factors are influence on consumer which lead
3.1 Stages of Consumer Decision Process his behavior towards action, which in turn consumer
Problem Recognition decide to buy the ecology energy and finally
outcome is acceptance and continue to adopt the
3.1.1 Information Search The ecological attributes
process for ecology product.
of a product plays important role in choosing the
product. The consumer here will pass from the two 5 Research Method
situation Firstly Sustainability Needs it s required The main purpose is to assess environmental sound
by a consumer likes or not and secondly the consumer behavior, eco-attitude, behavior and
environment lower in importance but influence on factors that can influence customer in their decision
the consumer [63] change the customer behavior to buy green energy. Authors of this research report
and it takes time to diffuse in the marketing. For this conducted a survey to gain understanding on what
type of degree on innovation, firms usually are the consumers preferences and what factors
introduce a different manufacturing process, product influence consumers to buy the electricity.
or service that attains environmental sustainability
[66] the consumer decision process model starts This survey is conducted from those people who are
with the problem recognition what are the needs and living in different cities of Sweden- Vasteras,
satisfaction process. Consumer is not always Eskilstuna, and Stockholm who are using the
electricity and paying the electricity bills. Sample
3.1.2 Purchasing Process size of this survey was conducted from 500
This phase focuses on the two aspects (i).purchase inhabitants selected randomly. The response rate
patterns, it include where to buy (Location), was over 90 per cent, after sorting out ineligible
quantity to buy, and when to buy (timing )and survey, useable responses sample for data analysis.

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Variables Positive correlations Negative Neutral

Sex (female) Mainieri and Barnett (1997) Arbuthnot (Getzner and Grabner-
1977. Krauter 2004)
Brooker,
1976

Age Pickett, M. G., Kangun. N. and Grove, J. S.

(1995, P.77),(Moses 2000)
(Adolescent)

Income (Laroche et al. 2001), Anderson & (Getzner and Grabner-

Cunnigham, 1972.Pickett, M. G., Kangun. Krauter 2004). Mainieri
(High) N. and Grove, J. S. (1995, P.77) and Barnett (1997

Environmental (Laroche et al. 2001), Zimmer et al. 1994, Kinnear et Samdahl and
knowledge Roberts 1996). Anderson & Cunnigham, al.1974
Robertson1989, Fuller
1972, (Peattie, 2001).(Granzin and Olsen
1991, Paco and Raposo 2009). Peattie & (1999)
Crane, 2005).

Social Group Kramer and Goldman, 1995, Macdonald Antonies at el, (1998,p
Influence and Oates (2006).
(270).

Mintel (2006), Wiser, 2007 Ottman (1993,

Perceived Benefits
P.27), Antonies et al (1998, p.205) Wood,
& Neal (2009)

Price (Mendleson, 1994)., (Ginsberg and Bloom, (Glaser, 2009), Ottman,

2004), (1993 P.8)
(High)

Eco-labelled (Chase and Smith (1992) Bleda and

Valente
(2008)

Communication Nik Abdul Rashid (2009), D Souza, 2004 Davis (1993)

;) Baldwin (1993), Chase and Smith
(1992),

Table. 1 Variable links With Green Purchase Behavior: Correlations and environmental behaviour

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The questionnaire consists on mainly into two parts,

in the first part data were collected about
demographic information and characteristics e.g.
gender, age, income and children. In the second part
examined the concern of environment and use of
Evaluations
green energy and important factors that influenced
Ecology Search for Ecology
Problem Ecology Ecology Behavior in the purchasing decision. Likert rating was used to
Identificati
on
Information Products record the consumers response by using six scales
(1) Strongly disagree (2) Partially disagree (3)
Donot know (4) uncertain(5)partly agree(6) strongly
disagree
For this research the data were gathered through
Questionnaire is to measure the respondent
behavior, their knowledge on sustainability on
environment and how they see the role of energy
Price Perception companies in promoting the renewable energy.
Social Influence However, authors of this survey believe that the
Ecology Product
Ecology-
results of this questionnaires analysis would serve a
Communication good resource for further research in the area of
Social green energy market. In our research we are not
Responsibility
examining the purchasing behavior of the
individual, despite that studying the consumer
Ecology
decision behavior what factors influence or effect on
Communic behavior of consumer concerned renewable energy
ation Process Model
Figure 1: Ecology Decision choices.

was 400 inhabitantsSocial

in Sweden. In survey it is a 5.1 Descriptive Research
notable achievementResponsibil
to get filled maximum survey After writing the literature review and developing
for questionnaires. Inity
our survey method respondents own conceptual frame work, the descriptive analysis
were given a questionnaire to fill, questionnaire was an appropriate research method through which
contain, 29 questions which consists of Demographic we can answer our research question which was
information, level of information about the electricity based on describing the decision process of
market, why they choose the certain electricity consumer.
supplier and some questions were related to the green
electricity. Authors of this survey select some Hair et al. (2002, p.41) define descriptive research
important questions from this questionnaire that was as methods and strategy to compile and consolidate
more closely related with our research questions. Due data in structured form that show the existing
to time and resource limitations the research could characteristics i.e. attitude, intentions, price
not analyze all the questions from the different Perception preferences, Social influences (purchase
prospects. behaviors), environment knowledge of a target
population.
The questionnaires include in our survey are include
some background information like, Nationality, According to Hair et al (2002, p.41), the descriptive
Gender, Profession, year of Birth, Place of living, research is applicable when a researcher look to
Live in House or Apartment or with children , and answers to the how, what, who, when and where.
which electricity company peoples are using. These questions are interconnected with marketing
Further we will include some question to know and decision variables in a uniqueness market
about the actual electricity supplier, to know that structure.
whether they are satisfied with their current supplier 5.3 Data Collection
and their energy companies are providing the
quality or not. Overall the question would be The Population would be selected for questionnaires
included, trust, commitment, price perception, in particular from Vasteras, Eskilstuna, Stockholm
subject norms, past behavior, questionnaires and some other cities of the Sweden. The
regarding from the new energy market and questionnaires will be filled on the spot from those
alternative attractiveness. people who are using and paying for the energy.

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The data will be gathered through primary and result presented in the Graph below, 46%
secondary sources in order to answer the research respondents were males and 54% were females.
question. The primary data will be collected through Here authors are using percentage method for
the survey questionnaires. Secondary data would be analysis of the data. Authors will relate this question
collected through different sources, studying the with other questions to make analysis from different
previous research on our research topic. perspectives. Sample size of this survey was 400,
and those respondents selected randomly. Fallowing
5.4 Population and Sampling
graph shows number of respondents according to
In this research study population will be consisted gender and occupation. Mostly respondent of this
mainly from the Vasteras, Eskilstuna, and survey were employed people, among those
Stockholm and from some other cities. Fisher et al employees 184 were male and 216 were females.
(2007, p.190) in probability sampling, all elements
in the population have an equal chance of being 6.2 Market Communication
included in the sample. It minimizes the possibility 6.2.1 Consider my electricity supplier to be good
of an unrepresentative sample. a give good value for the money?
Convenience Sampling it is a non-probability This question was asked to respondents to see,
sampling method Hair et al (2002, p.359) defines in either they are satisfied from current electricity
this method participants are selected according to provider company or not? If a customer does not
the convenience of the researcher that meets satisfy from its electricity provider then he or she
requirements of the study . can consider switching to other company.
5.5 Reliability The results shows this 6% respondent are strongly
Reliability of the primary data is very important disagree from the question, 15% are partly
because we mainly depend upon the respondent s disagree,23% are uncertain about their electric
opinion. When we have completed all the supplier is provided the good services and gives the
Questionnaires filled from the respondents on spot, value of their money, 22.75% are Partly agree,
the data compiled into excel sheet independently by 18.25% are strongly agree, and 15% do not know.
each author to check the validity of the data and Here we can see that 44% respondent of this survey
minimize the error of duplication in the data. Then are those who are strongly disagree, partially
authors compared the both excel sheet to check the disagree and uncertain collectively. The result
accuracy of the data. Questionnaire was filled and drawn these consumers may switch their electricity
collected from the respondent on the spot, because provider. So companies have to do work for availing
we want to make sure that the survey form is filled this opportunity.
by the person himself. If we hand over the survey
form to the respondent and collect it later, there 70
60
might some chances that they get filled form with 50
the help of other person and credibility of the data 40
could not be established. We had put more focus in 30
20
obtaining the personal opinion of the respondents. 10
Male
6 Analysis 0
Female
6.1 Back Ground Information
Demographic data is useful in order to make the
analysis more meaning full for the readers. The
reason to include this question is to determine the
reliability of the data, that our sample size included
only the Swedish citizens. The survey result shows Fig:2 Reason for choosing the current supplier
that 97% of the data collected from the Sweden
citizens and rest 3% of the peoples are staying in 6.2.2The reason for choosing your current supplier
Sweden for different purposes. Authors include this The items measuring what factors affect on
question because Gender Equality is important in consumers in choosing the current supplier. The
the survey to determine the ratio of men and results are more significant people are more likely to
women. This question tells the researcher how many switch the electric supplier. The dominate factor is
respondents were males and females. According to the lower prices (Figure 2) a significant number of

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customer preferred good services of a company. To check the influence of reference group
when we compare the result of consumers preferred (influenced by others) in choosing of electricity
that the company is environmentally friendly with provider researcher put this question in front of
the other people use them (figure 2) gives the results respondents to check their response. The result
that in most case particular women chose a certain shows that 2.25% strongly disagree with the
supplier, decision is based on the reference group question, 8.25% partly disagree, 24.25% said they
other people used them . Positive attitude of male do not have any idea about that, 12.75% are
is exists towards environmentally friendly company uncertain may be or may not be, 20% are partly
as compared with the women. There are agree with the question while mostly respondents
opportunities for the companies to positioning which are 32.50% of total feel that many other
themselves as services oriented firms by providing households in their municipality have changed
good quality services. electricity supplier. We can conclude that reference
group/society has major impact on individual in
Fig:2 Reason for choosing the current supplier
choosing the energy that other uses. If members of
6.3.3 Use green energy and Received Information closed group using green energy the individual
from company would also tend to choose the green energy.
27% of respondents are using green energy while
remaining 73% are using conventional energy. This Greenest Product
shows that opportunities for the growth of green
energy is still exist and companies can carefully Innovations
design their marketing activities towards these Low Price
customers. Social Responsible
6.3 Price perception
0 50 100 150
6.3.1 Compare to its competitors, I believe that
my electricity supplier s prices are Social
Low Innovati Greenest
The purpose of this question is to find out the Responsi
Price ons Product
perception of people in order to price perception of ble
their current electricity provider company. From the Female 61 92 14 17
analysis 29.50% of respondent agree o that their
Male 40 139 13 24
current electricity provider company charging lower
prices than the rest of companies, 46% have
favorable attitude that companies charge equal Figure 3: Choice of Energy
prices or charge average with their competitors,
10% said that current supplier are charging higher
Comparision of occupation and
prices while 12.50% don t know about this.
factors
6.3.2 Price of green electricity
80
No of pe o p l e

Question on price was asked to check and 70 Lower Price

understand the customer sensitivity towards the 60
50
green energy. The result shows that most of the 40 Good Service
respondent doesn t know about green electricity 30
20
prices and their percentage among all respondent is 10 Environmental
43%, 34% said green electricity prices are higher 0
Se l f Emp l oy e e d

y Friendly
Emp l oy e e d

Pe n s i on e r

than conventional electricity providers, 19% said

Ot he r s
St ud e n t

both type of electricity prices are same or averagely No other

same, while 4% said green electricity prices are supplier
lower than other companies. Other People
6.4 Social Influence used

6.4.1 Neighborhoods or Households change

Figure:4 Comparison of occupation and factor
electricity supplier

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Amount % Female % Male

Comparison of occupation and factors

>50 kr 24% 18%

Others

50 to 100 kr 16% 13%

Self
Employed
101 to 200kr 11% 6%

Employed

201 to 300kr 9% 1%
Students

0 50 100 150 301< kr 2% 0%

Social Responsible Low price

Innovations Greenest Product

Figure.5 Comparison of occupation and factors

Table: 2. Consumer willingness to pay more for
green energy.
6.4.2 Switch from your current electricity 20% said they get information while rests of 26%
supplier to new one are uncertain that they get it or not. This is another
After getting idea about respondent awareness to factor is major hindrance in making decision due to
electricity companies, price perception and which green electricity companies have low market
reference group information, subsequently share. Label primarily serves as a source of
respondents were asked about there intention to providing information to consumers
switch their from current supplier to new supplier. 6.5.2 Current supplier provides renewable
The result indicates that 2% are unlikely to switch, electricity
6% said certainly they can switch, 15% each said no
chance to switch or probably they can switch, 31% After checking awareness level environment
respondents said they are likely to switch and 32% knowledge respondents were asked that either their
said improbable they can switch their current current electric supplier provides green energy or
electricity supplier. not? Result indicates that 47.75% are using
conventional electricity providers 26.50% are using
6.5 Environmental Knowledge green electricity provider while 25.75% are
6.5.1 I received information concerning uncertain about this while their electricity provider
renewable energy suppliers is either providing green electricity or not.

The analysis of this data indicates that companies 6.5.3 Willing to choose supplier providing green
are not providing information regarding the energy
renewable energy. As results shows that 54% of From previous question it s clear that mostly
respondents responded that they are not receiving households are not using green electricity, so now
information regarding renewable energy suppliers, researcher will find out why not what is the reason,

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buy putting up stated question. 37% respondent said company. The analysis of relationship between the
this is due to lake of information they don t sign occupation and factors in choosing of Energy
contract with green energy Provider Company, 24% Company shows that more specifically in
said it will take time and prices of green electricity occupations particularly students and the employed
are too high, and 15% that they are satisfied from person have more attitudes towards choosing the
current electricity provider Company. energy companies who owned social responsibility,
on the other side self employed over all have least
6.6 Willingness to Pay Extra (Social interest in the other factors and this data shows that
Responsible) they have least interest in the lower price and social
6.6.1 What makes you want to choose a certain responsibility of the company. With regard the
electricity provider relationship between factors of employment and
reason to choose electric supplier, it can be stated
After finding out reasons of not selecting green that opportunity is exit for the green energy
electricity provider now examine that what factor companies to turn into the socially responsible; they
your give priority in selecting the electric supplier can take advantage in building good image where
Results shows that mostly respondents think lower they are operating.
price is the main factor in selecting electricity
provider in Sweden 57.75% agree on this. 6.1.2 How much extra would you be prepared to
According to 25.25% respondents social pay per month to get green energy
responsibility is the main factor, while 6.75% think This results shows that the Swedish peoples are
about innovation and 10.25% prefer that product more environmentally conscious and there interest
which is most fit or better for environment. It can be in paying a more for the green energy and they
stated that social responsibility factor plays understand the environment impact of other
significant role after price in choosing electricity conventional energy resources. Moreover more
provider. But from previous questions it was shown female consumers are willing to pay more for the
that green electricity companies are doing nothing in green energy as compared with the male.
building awareness.
From the figure 3 after analyzing data as a whole Female attitude is positively related with the
now authors find out that mostly males prefer low environmentally friendly product (table 2 ) shows
price while choosing electricity provider then that 24 % of the women are willing to pay extra 50 kr
females. If we see social responsibility factor for protecting the environment and 16% are willing
females prefer it then males. Response regarding to contribute 100 kr. It can be seen that the
innovation does not have significant difference in environment concern is more prevailed in the female
males and females, more males prefer greenest than the male respondents.
product then females. 7 Discussion of analysis and findings
Table: 2. Consumer willingness to pay more for The proceeding analysis of questionnaire data the
green energy research indicate that quality of the service of a firm
Observing from the graph of comparison between and lower price are particular main factors of
occupation and factors in choice of energy, in each concerned which influence on the consumers in
of these factors it is clear that all of the occupations making the pre-decision with regard to the social
support the lower prices of the energy. Majority of influence. This findings support the primary motive
the respondents from all occupations prefer those after the price behind in adopting the environmental
energy suppliers who provide the good services. behavior is the influence of peoples, majority of the
Perhaps from the above data it is clear that the people adopted life style from their social networks
majority of the students and employed person and these social networks are critical for improving
supports the lower prices and quality of the service the quality of life [67].Price is important factor as
of Energy Company. our analysis shows that both male and female
consumers responded that the price of the green
From each of the above factors it is cleared that energy is high. This research results are consistent
environmentally friendly and other people used with our literature review that the price perception
electricity have influenced on the consumers. It is of green energy among the Swedish consumers is
evident from the above (figure 5) employed person high and they consider green electric supplier prices
have positively relationship with the factors are high. In comparison with the previous research
influence on the consumers in choosing energy and studies it is consumer perception about the price

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 Recent Researches in Economics

of green energy are high [48]; [17]. This analysis availability of electric supplier. It is also noted from
also support the notion that the consumers who buy the analysis of the data that responsibility towards
the energy are also convinced form their neighbors environmental issue is also not predominant factor
and society all these factors have strong influenced in making decision of choosing the electricity
on consumers in building their beliefs and behavior supplier. The survey result also shows that the
towards choosing the energy. Such a conclusion is consumers are using the green energy but their level
consistent with the research [38]. This research of knowledge on energy is low. However, there are
reveals that consumer participation in green a large number of consumers who are not using the
initiative programs have significant influences in green energy but they show the tendency of using
their social community and neighbors. the green energy if they provided with low prices.
In the questionnaire respondent were asked whether In an effort to promote the green energy the electric
in the past they have switched the electricity supplier must build all efforts in increasing the
supplier or not. Majority of the respondents awareness of the consumers and need to provide
answered that they have switched from their necessary knowledge about the environment. Our
electricity supplier. This shows that in Sweden main focused was on the consumer behavior, this
switching in one electricity supplier to other is survey analysis shows that consumer behavior is
common and this is a big opportunity for those developed in the individuals to some extent from the
companies who are turning or planning turn into social networks. However trend shows that Swedish
green. [68] supports the idea that consumers attitude consumers support the low price company but on
towards switching the current electric supplier is the same side a majority of the consumers trend also
probably the negative due to offering choice of supports the social responsibility and services of a
green energy. High price and quality of service were company providing.
other some main factors.
8 Implications and Limitations
The information level regarding renewable energy
This research study provides a path way for the both
information is not significant with the intention to
theoretical and for the management. This research
purchase the electricity from the environmentally
friendly supplier. This is contradictory with the supports the previous research that consumer s
shows strong concern for their environment. In
previous research [25],[26]. However on the other
side the female consumers expressed interest in addition, this research provides a basis of
reading the information provided by the electric understanding the important factors affect on the
supplier, this potentially women encourages through consumers in making the purchasing decision and
providing more precisely information. On the other factors which motivate and are barriers in
side, the questionnaire concerning the knowledge of purchasing the green products. In past a number of
green energy and use of the green energy the studies focused has been given on measuring
majority of the respondents knowledge on green environmental awareness behavior, this research
energy is low instead their electric supplier is provides a profile of Sweden green consumers and
identify the gap that exit among the consumers
providing the renewable energy contracts.. The
green supporting behavior. Further suggest that the
energy companies who are turning into the green
energy can reap the financial and social benefits in Consumer knowledge and beliefs about the
future because Green marketing has long term environment issues is a powerful tool for
impact in consumers in the energy market. segmenting the market.

This results shows that the Swedish peoples For the managerial implication the consumer profile
particular female respondents are more of supporting the environment and purchasing the
environmentally conscious and there interest in green product is an indication for the green
paying a more for the green energy and they marketers to target and segment the consumers
understand the environment impact of other according to their profile basis. In order to satisfy
conventional energy resources. Analysis is support the green consumers, marketer can develop and
the argue of [69] willingness to pay more for the make sure that the product contains visible
electricity of the consumers indicates the pro- environmental benefit and offered a comparative
price with similar to the other energy companies.
environmental attitude is exists in the Swedish
The marketer can use a green marketing mix
consumers.
approach in their communications in order to
Price and other factors are the other main hindrance change the consumer attitude towards green
in making contract with the electric supplier is non purchasing behavior.

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 Recent Researches in Economics

The sample in the study is limited to Vasteras and

Eskilstuna and Stockholm only due to the limited
time, the findings will be drawn from the analysis.
The research findings of this work should not be
considered generalized for the whole population,
since Sweden is a ethnic and multi-cultural society.
The one major limitation is that we cannot hire the
staff from the different cities of Sweden for this
research because in our questionnaire some terms
are required to elaborate to the respondent, this
could bring problems in our data analysis if they
missed the specific question in the questionnaire.
The other main hindrance is that budget. Due to
financial resources the population from different
cities could not sampled ,future studies should use
population from other cities and must conduct the
cross cultural studies of different ethnic groups
lived in Sweden.
8.1 Future Research
This academic paper is preliminary study of some
factors that affect consumer s choice for an
electricity supplier. The future researches can
continue this study by comparing the effect of
demographics on consumer s choice. This will help
electricity companies in preparing marketing
strategies for green electricity on demographic
basis. With the help of this research energy
companies will be able to target and approach their
potential consumers more accurately.
Sample size for this research was smaller in future
with bigger sample size and more factors can be
added to study the consumer behavior. Moreover,
further study can identify the potential green
segment for the energy market based on
Demographic, Psychographics segmentation. Future
research can also be taken to see how consumers
make decision with respect to gender, age group,
occupation and incomes, so researchers have a
broader field to invest and come with fruitful results
in future.

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