Int. Journal of Business Science and Applied Management, Volume 16, Issue 3, 2021
Examining User Acceptance and Adoption of the Internet of
Things
Yang Lu*
International Business School Suzhou, Xi’an Jiaotong-Liverpool University
No.8 Chongwen Road, Suzhou, China
Tel: +86 (0) 512-88167879
Email: Yang.Lu@xjtlu.edu.cn
Abstract
The Internet of Things (IoT) promises a new technological paradigm that can offer a number of
innovative applications and services targeting different scopes of adoption. The full potential impact of
the IoT is enormous due to its pervasive nature and the rapid improvement of enabling technologies.
Taking lessons from information technology and systems in their early stages, a low degree of user
acceptance would hinder the progress of IoT implementation. Studies of the IoT from the user
perspective mainly investigated factors influencing acceptance and use of a specific service or
application. A comprehensive view of users’ attitude toward the IoT platform may offer further
insights. Drawing upon the Diffusion of Innovation Theory and the Technology Acceptance Model,
this study examined six potential determinants of users’ adoption of the IoT platform and tested two
potential psychological outcomes. Using data collected from 615 potential users and analysing with
structural equation modelling techniques, the results and findings of this study contribute to facilitating
understandings of IoT acceptance and adoption.
Keywords: Internet of Things, Technology acceptance, Diffusion of Innovation, Structural equation
modelling
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1. INTRODUCTION
The Internet of Things (IoT) promises a new technological paradigm, by connecting anything and
anyone at any time and any place, using any path/network and any service (Baldini, Botterman, Neisse,
& Tallacchini, 2016; Guillemin & Friess, 2009; Man, Na, & Kit, 2015; UK Research Council, 2013).
The IoT vision is that of a “smart world” which is equipped with sensing technologies and smart
components (Lu, Papagiannidis, & Alamanos, 2018). The IoT features Web 3.0, which involves users
much more deeply than its predecessor, namely Web 2.0, as they and their immediate physical
environment are more heavily involved with the technology in ways that go far beyond content creation
and sharing (Kreps & Kimppa, 2015). Not surprisingly, such a bold vision has captured the imagination
and attention of both academics and practitioners, as the IoT could underpin innovative services and
applications (Lu et al., 2018). The IoT is expected to have a significant impact on individuals,
businesses, and policy as societal and business models will be challenged, and new services introduced
(Shin, 2014; Stankovic, 2014).
IoT can offer a number of innovative applications and services targeting different scopes of
adoption, such as the smart city that integrates multiple technologies at infrastructural level and smart
home that applies at the individual level (Leong, Ping, & Muthuveloo, 2017; Lu et al., 2018; Marikyan,
Papagiannidis, & Alamanos, 2020). However, most of the early IoT products were developed by
merely equipping existing objects with sensors or tags, aimed at facilitating the collection, processing
and management of information (Lu et al., 2018). Despite the fact that only a small number of
applications and services is currently available to individuals, the full potential impact of the IoT is
enormous due to its pervasive nature and the rapid improvement of enabling technologies (Atzori, Iera,
& Morabito, 2010; Shin, 2014). One of the future trends of IoT technologies is becoming user-oriented,
which will further facilitate the developmental activities and satisfy the diverse needs of users (Lee &
Lee, 2015; Shin, 2014; Sundmaeker, Guillemin, Friess, & Woelffle, 2010; Vermesan et al., 2015).
Given that IoT technologies and services are steadily progressing and reaching mainstream markets, it
is high time to examine the IoT from the perspective of users.
The viability and prospects of IoT applications and services are largely determined by the market
demand and user acceptance (Kim & Kim, 2016). Taking lessons from information technology and
systems (IT/IS) in their early stages, a low degree of user acceptance would hinder the progress IoT
implementation (Kim & Kim, 2016). Prior studies from the user perspective mainly investigated factors
influencing acceptance and use regarding a specific IoT service or application, and provided
suggestions for practitioners in formulating business strategies to attract better adoption, e.g., (Bao,
Chong, Ooi, & Lin, 2014; Chong, Liu, Luo, & Keng-Boon, 2015; Gao & Bai, 2014). Although
previous studies on IoT acceptance provided valuable insights, solely adapting mainstream information
system management (MIS) theories for different contexts has limitations in providing comprehensive
views of the IoT platform. Besides, one recent article investigated the IoT as a platform and studied the
spillover effect from its predecessor, i.e., the Internet platform, and reported significant influences of
emotional reactions and psychological outcomes of Internet use on IoT acceptance (Lu, Papagiannidis,
& Alamanos, 2021). Following the above, the second objective of this study is to examine factors
influencing user acceptance of the IoT as a technological paradigm.
Studies on user acceptance and adoption have sufficiently explored influential factors adapted
from a number of MIS theories and have tested their effects on the users’ behaviours of technology use
(Venkatesh, 2021). Also, the majority of IoT acceptance and adoption studies were conducted under a
specified research context or targeting a specific IoT service or application. As such, a comprehensive
view of users’ attitude toward the IoT platform may offer further insights. In addition to the widely
employed technology acceptance theories, the Innovation Diffusion Theory (IDT) (Rogers, 1962;
Rogers, 1995), which investigates the process of diffusion, may offer valuable insights into
understanding IoT adoption. Given so, incorporating and testing factors from technology adoption
theories potentially contribute to facilitating understandings of IoT acceptance and adoption.
The following sections proceeds to discuss the hypotheses and theoretical framework put forward,
the methodology and analysis approach used, statistical results and findings, as well as discussion and
conclusions.
2. HYPOTHESES DEVELOPMENT AND RESEARCH FRAMEWORK
2.1 IoT Acceptance and Adoption
The various antecedents of individual, technology and environmental characteristics as well as the
consequences of use are typically studies in technology adoption literature (Venkatesh, 2021).
Furthermore, studies of the IoT from the user perspective largely focus on exploring and examining
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potential factors influencing users’ acceptance of one given IoT application or service. The majority of
the current studies were conducted within a specified research context or targeting a specific IoT
service, e.g. smart home (Bao et al., 2014; Kim, Park, & Choi, 2017; Marikyan et al., 2020; Park, Cho,
Han, & Kwon, 2017), smart healthcare/eHealth (Arfi, Nasr, Khvatova, & Ben Zaied, 2021; Arfi, Nasr,
Kondrateva, & Hikkerova, 2021; Karahoca, Karahoca, & Aksöz, 2017; Martínez-Caro, Cegarra-
Navarro, García-Pérez, & Fait, 2018; Pal, Funilkul, Charoenkitkarn, & Kanthamanon, 2018),
autonomous vehicles (Manfreda, Ljubi, & Groznik, 2021; Yuen, Cai, Qi, & Wang, 2021), and smart
city (Leong et al., 2017).
The majority of IoT acceptance and adoption studies were drawn upon technology acceptance
theories such as the Technology Acceptance Model (TAM) (Davis, Bagozzi, & Warshaw, 1989), the
Unified Theory of Acceptance and Use of Technology (Venkatesh, Morris, Davis, & Davis, 2003), the
Theory of Planned Behaviour (Ajzen, 1991), etc. Also, the most commonly tested dependent variable is
behavioural intention, which indicates the individual's readiness to perform a given behaviour (Davis et
al., 1989; Tscherning, 2012; Venkatesh, 2021). Evidence from previous studies supported that the two
fundamental constructs of TAM, i.e., perceived usefulness and perceived ease of use, significantly and
positively determine the users’ intention of using IoT applications and services (Bao et al., 2014; Gao
& Bai, 2014; Jang & Yu, 2017; Liew et al., 2017; Mital, Chang, Choudhary, Papa, & Pani, 2017; Park
et al., 2017).
IDT is one of the most influential theories in understanding technological evolution, postulated
that individuals degree of willingness of adoption is contigent on the individuals’ perceived
characteristics of the target innovation (Marikyan et al., 2020; Rogers, 1995; Tornatzky & Klein,
1982). More specifically, IDT explored and developed a comprehensive set of attributes of innovation
that significantly determine the adoption (Rogers, 1962). This set of attributes has been further revised
to six perceived characteristics of innovating, i.e. relative advantage, complexity, compatibility, result
demonstrability, visibility, and trialability (Moore & Benbasat, 1991; Rogers, 1983). The users appraise
the innovation characteristics after utilisation and reconsider the decision of continuous usage
(Marikyan et al., 2020; Rogers, 1995). This article aims to first test the effects of innovation
characteristics on user adoption of the IoT platform. Six hypotheses are put forward as follows.
First of all, relative advantage is a leading factor that determines the users' intention of adoption
(Abu-Khadra & Ziadat, 2012), referring to the degree to which an innovation is perceived as being
better than the idea it supersedes” (Rogers, 1983). The “advantage” is often expressed in terms of
economic profitability, social prestige, convenience, and satisfaction (Karahoca et al., 2017; Rogers,
1983). However, whether an innovation is objectively advantageous has limited influence on the users
adoption; instead, the individual's perception of the advantages determines the rate of adoption (Rogers,
1983). Perceived usefulness directly describes the perceived utilitarian value and functionalities of new
technology, which is defined as the degree to which an individual believes that using the technology
might enhance their performance in completing tasks (Davis, 1989; Davis et al., 1989). This study
employed perceived usefulness in testing IoT adoption intention.
An empirical study on the acceptance of smart lockers suggested that relative advantage has
positivi effects on the users’ attitude toward adoption (Tsai & Tiwasing, 2021). Beaides, perceived
advantage was also reported having positive invluence on the users’ perceived usefulness, perceived
ease of use, and behavioural intention of smart healthcare (Karahoca et al., 2017). Perceived usefulness
was also reported as having positive effects on the users’ attitude (Karahoca et al., 2017; Park et al.,
2017), behavioural intention (Bao et al., 2014; Gao & Bai, 2014; Liew et al., 2017; Mital et al., 2017;
Park et al., 2017), reuse intention (Jang & Yu, 2017), and satisfaction (Martínez-Caro et al., 2018) of
using the IoT. With the aim of investigating the users’ intention toward adopting the IoT, this study
hypothesised that
H1a: Perceived usefulness is positively correlated with users’ behavioural intention of using the
IoT.
Complexity refers to the degree to which an innovation is perceived as relatively difficult to
understand and use” (Rogers, 1983), while perceived ease of use is defined as the degree to which an
innovation is perceived to be easy to learn and use (Moore & Benbasat, 1991). These two constructs
have a resemblance in concept (Moore & Benbasat, 1996; Venkatesh et al., 2003). Fundamentally, an
innovation that is perceived to be less complicated is more likely to be accepted and adopted (Davis et
al., 1989; Rogers, 1995). The effect of perceived ease of use on IoT acceptance and adoption is
arguable. The majority of studies have reported positive effects of perceived ease of use on users
attitudes toward IoT, e.g., (Gao & Bai, 2014; Liew et al., 2017; Mital et al., 2017; Park et al., 2017).
However, the study of (Bao et al., 2014) did not show a significant effect while the studies of
(Karahoca et al., 2017; Tsai & Tiwasing, 2021) reported negative effects of complexity/perceived ease
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of use on users’ attitudes and intentions of adopting IoT service. This study proposes to examine the
role of perceived ease of use and proposes a positive effect.
H1b: Perceived ease of use is positively correlated with users’ behavioural intention of using the
IoT.
The third perceived characteristic of innovation, compatibility, refers to “the degree to which an
innovation is perceived as consistent with the existing values, past experiences, and needs of potential
adopters (Rogers, 1983). A high degree of compatibility implies that an innovation is less uncertain to
its’ potential adopters (Rogers, 1983). Ensuring the compatibility between IoT products is critical since
IoT-based services are enabled by connecting many smart objects into the network (Shin, Park, & Lee,
2018). For instance, smart home services usually require connection and communication between
various home appliances (Shin et al., 2018; Tsai & Tiwasing, 2021) and benefits of autonomous
vihicles should be compatible with users’ green lifestyle and special travel needs (Yuen et al., 2021).
Previous studies reported that compatibility is one of the most influential characteristics on IoT
acceptance and adoption, e.g., (Bao et al., 2014; Hubert et al., 2018; Karahoca et al., 2017; Park et al.,
2017; Shin et al., 2018; Tsai & Tiwasing, 2021; Yuen et al., 2021), etc.
H1c: Compatibility is positively correlated with users’ behavioural intention of using the IoT.
Observability in IDT has been separated into result demonstrability and visibility (Moore &
Benbasat, 1991). Result demonstrability refers to the degree to which the results of using an innovation
are visible and communicable to the others (Moore & Benbasat, 1991, 1996; Rogers, 1983). It also
describes the tangibility of the results of using the innovation (Moore & Benbasat, 1991). Even an
effective IS/IT could fail to gain acceptance and adoption if the users cannot attribute their performance
to using it (Rogers, 1983; Venkatesh & Davis, 2000). The study of (Hubert et al., 2018) indicated that
the effects of result demonstrability were positive on perceived ease of use, negative on perceived
usefulness, and not significant for behavioural intention of adopting the smart home system. A study of
autonomous vehicle adoption reported that result demonstrability positively influences perceived
usefulness and perceived ease of use (Yuen et al., 2021). This study proposes to test the effect of result
demonstrability on IoT adoption decisions.
H1d: Result demonstrability is positively correlated with users’ behavioural intention of using the
IoT.
Visibility describes the degree to which an IS/IT is apparent to the sense of sight (Moore &
Benbasat, 1991, 1996; Rogers, 1983), and does not necessarily require communication between
potential users. Visibility was suggested to be influential in persuading potential users to try the
innovation (Agarwal & Prasad, 1997). The finding of (Chuah et al., 2016; Yuen et al., 2021) suggested
that visibility positively affects the adoption of IoT applications. However, the study by (Hubert et al.,
2018) reported a non-significant effect of visibility on smart home adoption. Many IoT products, such
as wearable devices for smart healthcare, smart transportation services, and smart security products that
are distributed in public spaces, are noticeable for the potential users (Lu et al., 2018). However, IoT
products distributed in private spaces may not be visible to others. This study expects that visibility will
be an influential factor in enhancing adoption of the IoT paradigm.
H1e: Visibility is positively correlated with users’ behavioural intention of using the IoT.
Lastly, trialability is defined as “the degree to which an innovation may be experimented with on a
limited basis” (Rogers, 1983), which describes the possibility of trying out or using an innovation
before adoption (Moore & Benbasat, 1991, 1996). A high degree of trialability of innovation can
decrease the perceived uncertainty for the potential adopters, which further enhances the adoption and
use (Dutta & Omolayole, 2016; Rogers, 1983). The study of (Yuen et al., 2021) suggested that
trialability positively influences users’ perceived usefulness and ease of use of autonomous vehicles.
Although very few studies have examined the effects of trialability, it is an important component in the
process of technology adoption (Karahoca et al., 2017; Mohamad Hsbollah, Kamil, & Idris, 2009).
H1f: Trialability is positively correlated with users’ behavioural intention of using the IoT.
2.2 Internet of Things and Well-being
Well-being refers to the users’ need fulfilment and quality of life enhancement by using the IoT
(Lu, Papagiannidis, & Alamanos, 2019; Partala & Saari, 2015). IoT will bring about many benefits in
the users’ daily life, such as improving convenience and promoting well-being (Marikyan,
Papagiannidis, & Alamanos, 2018; Wang, McGill, & Klobas, 2018). Also, improving the users
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psychological well-being is a long-term objective of smart technologies (Marikyan et al., 2018).
Among the wide range of IoT-based services, IoT healthcare would largely benefit the users and
enhance their well-being by monitoring health remotely, thus reducing pointless hospitalisation and
lessening expenses in human services (Martínez-Caro et al., 2018; Mital et al., 2017; Papa, Mital,
Pisano, & Del Giudice, 2018). Smart buildings and smart cities that have massively distributed IoT-
enabled sensors can monitor the surrounding environment. thus creating a better living condition for
the citizens, ideally benefiting their health and well-being (Spaceti, 2017). Broadly speaking, IoT
services and products can positively influence the users’ well-being.
H2: Using the IoT is positively correlated with users’ degree of well-being.
2.3 Internet of Things and Perceived Value
Taking into account that IS/IT plays a critical role in people’s daily life nowadays, it is believed to
possess value for individuals. MIS studies proposed a number of constructs to represent different
values affecting technology acceptance and use, such as performance/utilitarian value (e.g. PU and
PEOU), hedonic value (e.g. cognitive absorption, perceived enjoyment, and playfulness), social value
(e.g. subjective norm and social influence), and monetary value (e.g. price value) (Agarwal &
Karahanna, 2000; Davis et al., 1989; Lowry, Gaskin, Twyman, Hammer, & Roberts, 2013; Venkatesh,
Thong, & Xu, 2012). Perceived value has roots in behavioural decision theory and social psychology,
and it can be defined as the users’ justification for the experience of using the IS/IT in their daily life,
regardless of whether this is for work or personal purposes (Okada, 2005). Moreover, the users’
perceived value of an IS/IT is a cognitive trade-off between the perceived benefits and sacrifice of
accepting the technology (Kim et al., 2017; Shin, 2017). The perceived benefits consist of increased job
effectiveness, individual productivity and task innovation, and decreased effort devoted to task
completion (Urbach & Müller, 2012). On the other hand, perceived sacrifices consist of the monetary
cost (e.g. price value), privacy risk, and difficulties in use (e.g. complexity) that would hinder the users
acceptance (Moore & Benbasat, 1991; Venkatesh et al., 2012).
Perceived value can be defined as the users’ cognitive overall assessment of using the IoT (Kim,
Chan, & Gupta, 2007; Okada, 2005; Zeithaml, 1988). (Shin, 2017) studied the value of IoT from the
utilitarian and hedonic points of view, suggesting that the perceived value positively influenced the
quality of overall experience of IoT use. Taking into account that the IoT is delivered in the form of a
service, the quality of experience critically determines the success of IoT implementation (Shin, 2017).
The perceived value of IoT increased the users’ continuance intention of smart devices that interact
with public services (El-Haddadeh, Weerakkody, Osmani, Thakker, & Kapoor, 2018). The study of
(Kim et al., 2017) viewed perceived value as an evaluation regarding the benefits and sacrifices,
positively influencing the user’s intention of accepting smart home services. (Jayashankar, Nilakanta,
Johnston, Gill, & Burres, 2018) suggested that perceived value positively affected the adoption
intention of smart agriculture technology. Existing studies have examined perceived value as
antecedents of IoT acceptance and use because perceived value, especially the instrumental value, was
viewed as closely related to the perceived usefulness in TAM (El-Haddadeh et al., 2018). Given that
this study regards perceived value as a construct reflecting the perceived importance and overall
evaluation of using the IoT in people’s daily life, it proposes to examine the perceived value as an
outcome of IoT use.
H3: Using the IoT is positively correlated with users’ perceived value.
Following the above, this study devotes to examine the influence of the perceived characteristics
of innovations on technology adoption. Drawing upon TAM and IDT, this study incorporates six
determinants, namely, perceived usefulness, perceived ease of use, compatibility, result
demonstrability, visibility and trialability, and tests their effects on the users’ intention toward IoT
adoption. Additionally, the diffusion of technology can be viewed as a process from technology
creation, technology use, and the consequences of use (Delone & McLean, 2003; Karahanna, Straub, &
Chervany, 1999). As such, this article explores the potential outcomes of IoT use as well. Based on the
hypotheses presented above, the research framework was put forward as follows (Figure 1).
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Figure 1. Research Framework
3. METHODOLOGY
3.1 Sampling and Data Collection
A questionnaire-based online survey was carried out to collect data for this study. An independent
market research company organised the respondent recruitment, consisting of Internet users in the
United States. Respondents were given the URL of the online survey and were asked to complete it.
The authors did not have direct access to the respondents, which preserved their anonymity. 670 full
questionnaires were initially received. Prior to the main survey, a pilot study was carried out with 10
participants. Based on the evaluation of this pilot study and the average completion time, collected
questionnaires that had been completed in very short time were excluded from the dataset. This authors
also removed questionnaires completed by selecting the same answer for most of the scaled
measurement items, including the reversed one. By applying the above-stated criteria in the data
screening process, 615 completed questionnaires were entered into the analysis. As the participants’
profile (Table 1) illustrates, the participants of this research are the general population and have a
reasonable distribution of demographic characteristics.
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Table 1. Demographic Profile of Respondents
Demographic
characteristic
Type
Frequency
(n=615)
Percentage (%)
Gender
Male
266
43.3%
Female
349
56.7%
Age
20-29
69
11.2%
30-39
127
20.7%
40-49
114
18.5%
50-59
139
22.6%
60 or over
166
27.0%
Current
employment status
Full-time employed
258
42.0%
Part-time employed
64
10.4%
Out of work (looking for work)
26
4.2%
Out of work (not looking for work)
6
1.0%
Homemaker
77
12.5%
Student
16
2.6%
Retired
125
20.3%
Unable to work
43
7.0%
Ethnicity
African American
65
10.6%
Native American
6
1.0%
USA White
452
73.5%
Asian American
28
4.6%
Hispanic American
37
6.0%
Multiracial
8
1.3%
Other White Background
15
2.4%
Other
4
0.7%
Education
attainment
Some high school or less
12
2.0%
High school graduate or equivalent
118
19.2%
Vocational/technical school
54
8.8%
Some college, but no degree
157
25.5%
College graduate
156
25.4%
Some graduate school
22
3.6%
Graduate degree
78
12.7%
Professional degree
18
2.9%
Residence area
Urbanized area
256
41.6%
Urban cluster
231
37.6%
Rural area
128
20.8%
Household income
$0- $24,999
114
18.5%
$25,000-$49,999
161
26.2%
$50,000-$74,999
138
22.4%
$75,000-$99,999
95
15.4%
More than $100,000
107
17.4%
The questionnaire of this study consists of 34 measure items of the 9 constructs. This model
included three variables adapted from TAM, four constructs selected from the perceived characteristics
of innovation, and two potential outcomes of IoT use (Table 2). Measurement of the perceived
usefulness, perceived ease of use, and behavioural intention of using the IoT were adapted from
(Venkatesh, 2000). The measure items of perceived characteristics of innovation, i.e. compatibility,
result demonstrability, visibility, and trialability, were adapted from the study of (Moore & Benbasat,
1991). Similar to the previous studies, items about well-being and perceived value were adapted from
the studies of (El Hedhli, Chebat, & Sirgy, 2013) and (Okada, 2005) respectively.
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Table 2. Measure Items of Constructs
Construct
Item
Source
IoT Perceived
Usefulness
Using the IoT improves my performance in my personal and
work-related tasks.
(Venkatesh,
2000)
Using the IoT in my personal and work-related tasks increases
my productivity.
Using the IoT enhances my effectiveness in my personal and
work-related tasks.
I find the IoT to be useful in my personal and work-related
tasks.
IoT Perceived
Ease of Use
The IoT is clear and easy to understand.
(Venkatesh,
2000)
Using the IoT does not require a lot of my effort.
I find the IoT to be easy to use.
I find it easy to get the IoT to do what I want it to do.
Compatibility
The IoT will be compatible with all aspects of personal and
work-related tasks.
(Moore &
Benbasat, 1991)
The IoT will be completely compatible with my current
situation.
The IoT will fit well with the way I like to accomplish my tasks.
The IoT will fit into my work style.
Result
Demonstrability
I would have no difficulty telling others about the results of
using IoT products.
(Moore &
Benbasat, 1991)
I believe I could communicate to others the consequences of
using IoT products.
The results of using the IoT products are apparent to me.
I would have difficulty explaining why using the IoT products
may or may not be beneficial.
Visibility
I have seen what others do using IoT products.
(Moore &
Benbasat, 1991)
In my community, one sees the others using IoT products.
The use of IoT products is not very visible among my friends. *
It is easy for me to observe others using IoT products.
Trialability
I've had a great deal of opportunity to try various IoT products.
(Moore &
Benbasat, 1991)
The IoT products were available to me to adequately test run
various applications.
Before deciding whether to use any IoT products, I was able to
properly try them out.
I was permitted to use IoT products on a trial basis long enough
to see what it could do.
IoT Behavioural
Intention
I intend to use the IoT in the future.
(Venkatesh,
2000)
I will try to use the IoT in my daily life.
I will plan to use the IoT frequently.
IoT Well-being
The IoT will satisfy my overall needs.
(El Hedhli et
al., 2013)
The IoT will play a very important role in my social well-being.
The IoT will play a very important role in my social well-being.
The IoT will play an important role in enhancing the quality of
my life in my community.
IoT Perceived
Value
Overall, what would be the value of the IoT for you personally?
(Okada, 2005)
How well-off would you be with the IoT?
How happy would you be with the IoT?
Notes: * = Reverse item.
3.2 Data Analysis
Multivariate analysis is widely used in addressing practical and theoretical research questions
(Hair Jr, Black, Babin, & Anderson, 2014). A number of widely used multivariate techniques, such as
multiple regression, factor analysis, multivariate analysis of variance, and discriminant analysis,
expanded the explanatory ability of surveys (Hair Jr et al., 2014). However, these techniques have a
common limitation in statistical efficiency in that they can examine only one relationship at a time and
the relationship between only one independent variable and many dependent variables (Hair Jr et al.,
2014). Structural equation modelling offers a number of advantages when compared with techniques
such as those mentioned above in terms of (a) making it possible to examine a series of dependence
relationships simultaneously; (b) it being particularly useful in testing dependence relationships of
multiple equations; and (c) allowing for assessing measurement properties and testing theoretical
relationships. This study employed structural equation modelling as the data analysis technique and
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followed the process suggested by (Hair Jr et al., 2014) and by (Gaskin, 2016). SPSS v.23 and SPSS
Amos v.24 were used for the statistical analysis of the main hypotheses and moderation effects.
The following section presents the strategy of data analysis of this study. This research adopted
three steps in the analysis, i.e. reliability and validity tests using confirmatory factor analysis,
collinearity and common method bias tests, and hypotheses tests using structural equation modelling
(Hair Jr et al., 2014). The next section presents details of the reliability and validity tests, and includes
the results of confirmatory factor analysis and the correlations between the constructs of each model.
Given that common method bias can be a potential issue for empirical studies using the same method to
measure variables (Podsakoff, MacKenzie, Lee, & Podsakoff, 2003; Richardson, Simmering, &
Sturman, 2009), this study further estimates the common method variances.
3.3 Reliability and Validity Analysis
Reliability refers to the consistency between a variable and what it intended to measure, while
validity describes the degree to which the measurements can correctly represent the concept of study
(Hair Jr et al., 2014). Put differently, reliability describes how a variable is measured whereas validity
concerns how well the concept is defined by the measurements. The construct reliability must be
satisfied before assessing validity (Hair Jr et al., 2014). As such this research tested construct
reliability, construct validity, and convergent validity by CFA. Three CFA models were established
separately.
Table 3 reported the factor loadings of each item and construct reliability (C.R.), average variance
extracted (AVE) and Cronbach’s α of the variables. First of all, (Hair Jr et al., 2014) suggested that
factor loadings greater than 0.3 are considered as having practical significance when the N > 350. To
satisfy the criteria of construct reliability and validity, the standardized loading should be greater than
0.5 and ideally higher than 0.7 (Hair Jr et al., 2014). The measured variables should also satisfy the
criteria of C.R. > 0.7, AVE > 0.5 and Cronbach’s α > 0.7. Given the above, some items were removed
from the CFA model since they (a) fail to load with the expected factor, (b) have factor loading lower
than 0.5, or (c) cause high cross-loadings. To this end, 6 items were removed from this study.
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Table 3. Confirmatory Factor Analysis
C.R.
AVE
Cronbach’s α
Item
Loading
IoT Perceived Usefulness
0.958
0.884
0.958
IoT-PU1
Removed
IoT-PU2
0.930
IoT-PU3
0.955
IoT-PU4
0.936
IoT Perceived Ease of Use
0.926
0.759
0.923
IoT-PEOU1
0.893
IoT-PEOU2
0.733
IoT-PEOU3
0.925
IoT-PEOU4
0.918
Compatibility
0.959
0.853
0.958
CPT1
0.923
CPT2
0.933
CPT3
0.950
CPT4
0.888
Result Demonstrability
0.914
0.781
0.914
RD1
0.847
RD2
0.907
RD3
0.896
RD4
Removed
Visibility
0.894
0.808
0.894
VIS1
0.882
VIS2
0.916
VIS3
Removed
VIS4
Removed
Trialability
0.937
0.832
0.937
TR1
Removed
TR2
0.911
TR3
0.916
TR4
0.909
IoT Behavioural Intention
0.942
0.890
0.942
IoT-BI1
0.940
IoT-BI2
0.947
IoT-BI3
Removed
IoT Well-Being
0.962
0.863
0.961
IoT-WB1
0.915
IoT-WB2
0.929
IoT-WB3
0.946
IoT-WB4
0.926
IoT Perceived Value
0.938
0.835
0.938
IoT-PV1
0.934
IoT-PV2
0.880
IoT-PV3
0.927
Notes: Method: M.L.; Model fit: χ2(314) = 952.391, CMIN/DF = 3.033, GFI = 0.902, CFI= 0.972,
RMSEA= 0.058.
Convergent validity tests were carried out based on the CFA model, as presented in Table 4.
Figures in the diagonal of each table represent the square root of the AVE and those below the diagonal
represent the correlations between the constructs. The square root of the AVE is greater than the
correlations between the constructs, suggesting that there was no convergent validity issue with the
three research models (Hair Jr et al., 2014). Given the above, this study successfully established the
reliability and validity of the constructs.
Table 4. Convergent Validity Test
IoT-PU
IoT-PEOU
CPT
RD
VIS
TR
IoT-BI
IoT-WB
IoT-PV
IoT-PU
0.940
IoT-PEOU
0.833
0.871
CPT
0.855
0.754
0.924
RD
0.751
0.787
0.786
0.884
VIS
0.656
0.630
0.695
0.745
0.899
TR
0.596
0.591
0.654
0.695
0.836
0.912
IoT-BI
0.910
0.831
0.858
0.742
0.686
0.609
0.944
IoT-WB
0.825
0.750
0.914
0.768
0.726
0.689
0.849
0.929
IoT-PV
0.794
0.742
0.888
0.784
0.718
0.693
0.824
0.908
0.914
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3.4 Collinearity and Common Method Bias Tests
Collinearity is a predictor-predictor phenomenon that occurs in multiple regression models. It
exists when two or more predictors measure the same underlying construct (Kock, 2015). A full
collinearity test should be conducted by calculating the variance inflation factor (VIF) based on
multiple regression analysis (Kock, 2015; Kock & Lynn, 2012). In the context of co-variance-based
SEM, VIF lower than 5 is the recommended threshold (Kline, 1998; Kock & Lynn, 2012) while VIF
lower than or equal to 3.3 indicates that the research model is free of collinearity issues (Kock, 2015).
Regression analysis of each dependent variable was run separately according to the composites of their
predictors. Results showed that the VIFs ranged from 2.674 to 4.707. All of the VIFs were lower than
the recommended threshold of 5, indicating that collinearity is not an issue in this study.
Common method bias (CMB), or common method variance, refers to the spurious variance that is
attributed to the measurement method rather than to the constructs themselves (Podsakoff et al., 2003).
CMB can be viewed as a “systematic error variance” shared among the variables being measured with
a common scaling approach or from a single data source (Fuller, Simmering, Atinc, Atinc, & Babin,
2016; Richardson et al., 2009). A great deal of evidence indicates that CMB can (a) influence construct
validity and reliability, (b) inflate or deflate the correlations between latent constructs, and (c) bias the
true relationships between substantial variables (Fuller et al., 2016; MacKenzie & Podsakoff, 2012;
Williams & Anderson, 1994). However, on the other hand, researchers have also suggested that the
common method variance at a typical level of multiple-item measures is not a threat to the validity of
research findings (Fuller et al., 2016).
This research adopted the common latent variable technique, or the marker variable approach, to
estimate the size of method variance. This technique was applied to the three CFA models and included
three steps (a) partialling out an unrelated variable as a surrogate/marker variable for common method
variances, (b) loading all of the items on both their theoretical constructs and the marker variable that
has its own measure items, and (c) constraining the parameters between research items and the marker
variables to be equal (Lindell & Whitney, 2001; Podsakoff et al., 2003; Podsakoff & Organ, 1986). The
marker variable in the case of this study is Job Satisfaction, which is theoretically unrelated to all of the
constructs. Job Satisfaction was measured in the same approach with other constructs, i.e. the 7-point
Likert scale, and included three items adapted from (Brayfield & Rothe, 1951), i.e. “I feel fairly
satisfied with my present job”, “most days I am enthusiastic about my work” and “I find real enjoyment
in my work”. The parameters between research items and Job Satisfaction represented the amounts of
method variance in this study, i.e. 33.0%. These results suggest that the common method variances of
each research model did not account for the majority of the variances. Therefore, this study is free of
CMB issues.
Taking into account the above, this research adopted a full collinearity test and an estimation of
the CMV using the marker variable approach. Statistical results indicated that collinearity is not
problematic in this study and the research findings are not affected by CMB.
4. RESULTS AND FINDINGS
Structural equation modelling (SEM) was employed to test the hypotheses about the main effects.
First of all, three SEM models were successfully established, by which the model fit criteria, i.e. 2 <
CMIN/DF < 5, CFI > 0.9, RMSEA < 0.08 (Hair Jr et al., 2014; Hooper, Coughlan, & Mullen, 2008),
were satisfied. The R
2
, direct effects, indirect effects, and total effects also suggested that the three
SEM models explained a sufficient amount of variance.
Statistical results indicated an adequate level of fitness of the structural equation model of this
study, i.e., CMIN/DF = 4.094, CFI= 0.955, RMSEA= 0.071. According to the model fit criteria
suggested by (Hair Jr et al., 2014; Hooper et al., 2008), i.e., 2<CMIN/DF<5, CFI>0.9, RMSEA<0.08,
the research model of this study was successfully established. Table 5 and Figure 2 present the
statistical results of the path analysis. Six out of the eight hypotheses were accepted, i.e., H1a, H1b,
H1c, H1e, H2 and H3. Specifically, among the six perceived characteristics of the IoT, Perceived
Usefulness (coef. = 0.281; p<0.001), Perceived Ease of Use (coef. = 0.153; p<0.001), Compatibility
(coef. = 0.508; p<0.001), and Visibility (coef. = 0.112; p<0.01) showed significant and positive effects
on the Behavioural Intention of IoT use. Also, Well-Being (coef. = 0.934; p<0.001) and Perceived
Value (coef. = 0.914; p<0.001) were found to be significantly related to Behavioural Intention.
Table 6 presents the R
2
and the direct effects, indirect effects, and total effects of the three
dependent variables, indicating a satisfied practical significance of the research model. The R
2
of IoT
Behavioural Intention is 0.952, which suggests that the six perceived characteristics sufficiently and
largely explained the variances in the users’ intention of accepting the IoT (Moore, 2010). This
research model also explained a substantial amount of the effects on Well-Being (R
2
=0.873) and
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12
Perceived Value (R
2
=0.835). Notably, Compatibility is the most powerful IoT characteristic and it
represented the largest amount of the direct effect on Behavioural Intention (Table 6).
Figure 2. Path Significances and Estimates
Notes: Significant at p: ns = > .05; * = < .05; ** = < .01; *** = < .001
Table 5. Structural Equation Model and Hypotheses Test (H3.1-H3.3)
Hypotheses
Path
Coef. (t-test)
H1a
IoT Perceived Usefulness
IoT Behavioural Intention
0.281 (6.801***)
H1b
IoT Perceived Ease of Use
IoT Behavioural Intention
0.153 (4.458***)
H1c
Compatibility
IoT Behavioural Intention
0.508 (13.261***)
H1d
Result Demonstrability
IoT Behavioural Intention
-0.022 (-0.632ns)
H1e
Visibility
IoT Behavioural Intention
0.112 (3.056**)
H1f
Trialability
IoT Behavioural Intention
0.029 (0.916ns)
H2
IoT Behavioural Intention
IoT Well-Being
0.934 (30.906***)
H3
IoT Behavioural Intention
IoT Perceived Value
0.914 (30.267***)
Notes: Method: M.L.; Model fit: χ2 (327) = 1338.596 , CMIN/DF = 4.094, CFI= 0.955, RMSEA=
0.071
Significant at p: ns = > .05; * = < .05; ** = < .01; *** = < .001.
Table 6. R
2
and Effect Size
Dependent Variable
R
2
Independent Variable
Direct Effect
Indirect Effect
Total Effect
IoT Behavioural
Intention
0.952
IoT Perceived Usefulness
0.281
0.281
IoT Perceived Ease of Use
0.153
0.153
Compatibility
0.508
0.508
Result Demonstrability
-0.022
-0.022
Visibility
0.112
0.112
Trialability
0.029
0.029
IoT Well-Being
0.873
IoT Perceived Usefulness
0.262
0.262
IoT Perceived Ease of Use
0.143
0.143
Compatibility
0.475
0.475
Result Demonstrability
-0.021
-0.021
Visibility
0.105
0.105
Trialability
0.028
0.028
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IoT Behavioural Intention
0.934
0.934
IoT Perceived Value
0.835
IoT Perceived Usefulness
0.256
0.256
IoT Perceived Ease of Use
0.139
0.139
Compatibility
0.464
0.464
Result Demonstrability
-0.020
-0.020
Visibility
0.103
0.103
Trialability
0.027
0.027
IoT Behavioural Intention
0.914
0.914
5. DISCUSSION
The findings indicated that the six determinants adapted from TAM and IDT sufficiently
explained variances in users’ behavioural intention of using the IoT. Specifically, perceived usefulness,
perceived ease of use, compatibility and visibility had significant positive effects on the users’ intention
of using the IoT, whereas demonstrability and trialability did not show significant influence on IoT
adoption decisions.
First of all, perceived usefulness is one of the leading factors determining user acceptance and
adoption (Abu-Khadra & Ziadat, 2012). The positive effect of perceived usefulness on behavioural
intention suggested that the instrumental value and the functionality of the IoT that can enhance the
users’ performance in completing certain tasks is critical to the potential users. Perceived ease of use
had a significant but relatively small influence on the users' adoption decisions on IoT. This finding is
in correspondence with the results of (Gao & Bai, 2014; Liew et al., 2017; Mital et al., 2017; Park et
al., 2017) but in contrast with (Bao et al., 2014).
Compatibility is the most influential factor driving IoT adoption, indicating that the consistency
between the IoT services and their current situation is one of the users’ concerns (Moore & Benbasat,
1991). These results confirmed the findings of (Bao et al., 2014; Hubert et al., 2018; Karahoca et al.,
2017; Park et al., 2017; Shin, 2017; Wang et al., 2018). Then, this result confirmed the finding of
(Karahoca et al., 2017). Visibility significantly affects one's intention to adopt the IoT as well,
supporting the viewpoint that the smart devices which are apparent to the users' sense of sight will
encourage them to adopt (Agarwal & Prasad, 1997; Chuah et al., 2016). On the other hand, statistical
results suggested that result demonstrability and trialability do not have any influence on the users’
intention. One potential explanation is that the uncertainty of using IoT products is not the users' main
concern, thus the tangibility of the results of use and opportunities to try the products before adoption
would not affect their intention (Dutta & Omolayole, 2016).
The strong positive effects of intention of IoT use on the expected outcomes suggest that the
potential users believe that the IoT has value in their daily life and they expect the IoT to benefit their
well-being. These findings confirmed that using the IoT is believed to be of importance to the users
daily life (El-Haddadeh et al., 2018; Shin, 2017) and would benefit them in terms of enhancing their
well-being (Marikyan et al., 2018; Martínez-Caro et al., 2018; Mital et al., 2017; Papa et al., 2018;
Spaceti, 2017).
6. CONCLUSION, IMPLICATION, AND LIMITATIONS
This study considered IoT adoption as a critical part of the innovation diffusion process, and it
thus examined the effects of characteristics of innovation on the users’ adoption decisions. The
successful establishment of the research model indicated that the perceived characteristics of
innovation sufficiently explained variances in users’ behavioural intention of adopting the IoT.
Statistical results suggested that the compatibility between IoT applications and the users’ current
situations and target tasks is the main concern. Also, the instrumental value and the visibility of IoT
devices play important roles in encouraging the users to adopt the IoT. This study contributed to
providing further insights into IoT literature by elaborating the effects of the attributes of innovation on
the users’ intention of adoption and examining the acceptance and adoption of the IoT platform instead
of one specific service. This research also contributes to the existing body of knowledge about
technology acceptance, adoption and use. Specifically, this research provided valuable insights into the
MIS theories in terms of extending the commonly used intention-based causal chain by incorporating
the users’ motivations of technology acceptance and potential outcomes of technology use.
This research is not without limitations. This study statistically tested the research models using
data collected from consumers in the U.S. Although these models performed well in elaborating the
Int. Journal of Business Science and Applied Management / Business-and-Management.org
14
factors influencing user acceptance and adoption of the IoT, the compatibility of research model should
be examined in other contexts, such as users in societies with different cultural backgrounds. This
provides a potential research avenue in examining and validating the research framework in other
settings. Besides, a number of factors that potentially influence user acceptance and use of the IoT
should be explored and examined in the future. For instance, in addition to the typical characteristics of
innovation investigated in this study, the unique characteristic of the IoT such as the ubiquitous
distribution of sensors and the users’ concerns about privacy invasion could be investigated in the
future. Also, psychological factors concerning IoT use and the personal attributes of IoT users should
be investigated.
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