BECC 2008 – Sacramento

Loren LutzenhiserPortland State University

SegmentationOverview

Topics

• Classic energy system segmentation• Theory that applies• Approaches• Examples• Problems• Benefits

Classic Energy System Segmentation

• Sectors

• Geographies

Forecasting Elements

• Climate Zones• Building Types

- Single family detached- Duplex, Triplex, etc.- Row house, Townhouse- Apartment, Condo- Mobile home

• Appliances

Energy Efficiency DSM Policy Approach

• Physical-tech-economic model: “PTEM”• Avoided cost, device-for-device, kWh/therm

impacts, $$$ savings• Energy service levels, consumer

purposes, installed measures, cost-effectiveness tests

Characterizes Typical Consumers as…

• Calculating, rational, economically oriented (costs, benefits, investments, returns, pay-backs, discount rates)

• Knowledgeable and/or information-seeking

• Individual decision-makers• Average and normal energy use patterns

$$

But … Lots of Variability

• 3 x differences in identical houses• 4 x differences in apartments across

cultures• Persistent “efficiency gap”• “The poor do without while the middle

class collect rebates”• 70% conserve in 2001 CA crisis, 30%

don’t

The rational actor cartoon doesn’t fit the facts

A Little Theory

• People (like other primates) live in groups• Groups do things together• Culture is the group’s collection of

relationships, meanings, practices, stuff• Society involve sorting, differentiating, pushing

and shoving (great big high school cafeteria)• Fair to call cultures and classes “lifestyles”

Some Definitions

• “distinctive modes of existence that are accomplished by persons and groups through socially sanctioned and culturally intelligible patterns of action.” Lutzenhiser and Gossard (2000)

• from the World of Goods: “…real partitioning amongst goods must be to trace some underlying partitioning in society.” Douglas and Isherwood (1980)

Variables and Approaches

• Demographics• Attitudes• Values• Personalities• Purchase behaviors• Exposure/Influences

Where to Get the Segments

• Segments/methods supplied by proven vendors

• Segments generated from customer data• Combination• Multiple segmentation schemes used at

once

Some Examples

• Commercial Segmentations- Claritas- Experian- SRI- Nielsen

• Custom Typologies- Hoggan BCH- UK Energy Savings Trust

Claritas PRIZMTM

Family LifeFamily LifeYounger YearsYounger Years Mature YearsMature Years

High

Low

$$

42 Red, White & Blues44 New Beginnings45 Blue Highways47 City Startups48 Young & Rustic53 Mobility Blues56 Crossroads Villagers

02 Blue Blood Estates05 Country Squires06 Winner's Circle

13 Upward Bound17 Beltway Boomers18 Kids & Cul-de-Sacs20 Fast-Track Families29 American Dreams

32 New Homesteaders33 Big Sky Families34 White Picket Fences36 Blue-Chip Blues50 Kid Country, USA51 Shotguns & Pickups52 Suburban Pioneers54 Multi-Culti Mosaic

63 Family Thrifts64 Bedrock America65 Big City Blues66 Low-Rise Living

14 New Empty Nests15 Pools & Patios21 Gray Power 26 The Cosmopolitans27 Middleburg Managers28 Traditional Times

38 Simple Pleasures39 Domestic Duos40 Close-In Couples41 Sunset City Blues43 Heartlanders46 Old Glories49 American Classics

55 Golden Ponds57 Old Milltowns58 Back Country Folks59 Urban Elders60 Park Bench Seniors61 City Roots62 Hometown Retired

03 Movers & Shakers08 Executive Suites11 God's Country12 Brite Lites, Li'l City19 Home Sweet Home25 Country Casuals30 Suburban Sprawl37 Mayberry-ville

04 Young Digerati16 Bohemian Mix22 Young Influentials23 Greenbelt Sports24 Up-and-Comers31 Urban Achievers35 Boomtown Singles

01 Upper Crust07 Money & Brains09 Big Fish, Small Pond10 Second City Elite

Experian MOSAICTM

Experian MOSAICTM

SRI - VALSTM

Nielsen Consumer 360°TM

Hoggan + Assoc.BCH Climate Change

The Choir� (15%) – sold on sustainability

The Congregation� (67%) – don’t understand sustainability butreceptive

The Heathen� (16%) – mostly young adults; are oblivious

The Atheists� (2%) – explicitly reject sustainability arguments; prioritize the economy

Energy Savings Trust

Problems

• Lassoing segments• Generalizing to population from sample• Actually locating types in the population• Moorings to theory & research• Segmentation sharp – policy and

programs blunt• Sharpened policy may not be equitable

Segments We Have in Mind

Segments in Reality

Nailed the Segments, Now Find them in the Population

But Segmentation is Importantbecause it …

• Recognizes consumer diversity• Goes beyond simple models, averages and

one-size-fits all thinking• Points to consumers’ special situations,

conditions, constraints, and needs• Current policies and program are not neutral• Can open a space for new policy

conversations and provide support for program innovations

Loren LutzenhiserProfessor of Urban Studies & PlanningPortland State UniversityPortland, OR 97207-0751

llutz@pdx.edu

Contact Information