Solar panel study shows it's OK to be a copycat

Sometimes, keeping up with the Joneses can be a good thing … especially if the Joneses have just put up solar panels on their roof.

Researchers from Yale and New York University have found that people are more likely to install solar panels after a few of their neighbors have done so.

By studying clusters of solar installations in California from January 2001 to December 2011, the researchers discovered that the likelihood of a homeowner putting up solar panels rose by 7.8 percent if there were 10 installations in that particular zip code. A 10 percent increase in the number of solar panels in a zip code pushed up the subsequent adoption rate by 54 percent.

“These findings have clear implications for marketers who are striving to reduce the high cost of consumer acquisition in the solar photovoltaic market,” said Kenneth Gillingham, an assistant professor of economics at the Yale School of Forestry & Environmental Studies. “Our finding of an increasing effect of new installations in a zip code suggests that targeting marketing efforts in areas that already have some installations is a promising strategy.”

Gillingham’s study with Bryan Bollinger, an assistant professor of marketing at New York University Stern School of Business, also found that word-of-mouth and increased visibility of solar panels encourages even larger installations.

“If my neighbor installs a solar panel and tells me he’s saving money and he’s really excited about it, it’s likely I’ll go ahead and do the same thing,” said Gillingham. “Then there are others who’ll install because they don’t want to be one-upped by their neighbors.”