Yoga, hybrid vehicles, clean technologies, organic farming, ecotourism, acupuncture and socially responsible investing are only a few products and services that are attractive to LOHAS consumers who have been leading the charge for these initiatives to be adopted by conventional markets.
The LOHAS consumer
The LOHAS consumer, in particular, represents the portion of the population that is pushing for product innovation. Gone are the days of sacrificing quality for the sake of environmental commitment. LOHAS consumers demand equal or better quality from a product, as well as depth and transparency from product manufacturers. The people who make up this segment are also predictors of upcoming trends, because they are early adopters of many attitudinal and behavioral dynamics. The Natural Marketing Institute (NMI), creators of The LOHAS Report: Consumers & Sustainability Series, has developed a segmentation model that defines consumers in the following categories.
LOHAS. Since the initial NMI study in 2002, LOHAS consumers have comprised approximately 13–19% of the adult population in the United States This percentage has remained steady throughout the years, even though many of the LOHAS products and behaviors have been adopted by the mainstream. Their usage of LOHAS products exceeds most other segments, and they are continually demanding greater sensitivity to these issues from numerous corporate activities. Consumers within the segment continue to be early adopters, influential with friends and family, less price-sensitive and more brand-loyal. In essence, the social structure and internalized values of the LOHAS consumer make them an attractive target for a variety of strategic marketing activities.
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Naturalites. The naturalites segment historically has been one of the largest of the U.S. adult population. They are zealous about their own personal health, and use many healthy and natural consumer packaged goods (CPGs). They are attracted to air purifiers, nontoxic paint, hypoallergenic mattresses and other health-related products due to the specific health benefits offered. Naturalites are not as concerned about the fair labor practices of companies, if a product is made using recycled materials or whether the product can be recycled in the future. Although they are less committed to the notions of holistic sustainability, they are also a primary target for many CPG companies, or for companies with a more mainstream proposition that have a strategic desire to appeal to a larger segment of the U.S. population. New parents concerned with a child’s diet and exposure to chemicals, or individuals with health concerns, typically fall into the naturalite category. This is an entry point for many who then evolve to adopt more LOHAS-oriented concepts as they become more educated.
Conventionals. This is the fastest-growing segment of the U.S. population due to the economic downturn, and the shift in consumer attitudes toward cost-savings. Companies that offer fiscally responsible products, such as energy-efficient electronics and appliances or green building products resonate with this group. Conventionals’ attitudes are not linearly categorized, but this segment shows a predisposition to various practical LOHAS products and activities. In some cases, they are more behaviorally engaged than naturalites, but not as much so as LOHAS consumers.
Drifters. Drifters are attitudinally aligned with some dimensions of the LOHAS market, although their behaviors lag behind that of the average U.S. adult. They are younger, have more financial barriers and have not yet fully formed their optimal values structure and ethical consumption standards.
Unconcerned. The people in this group don’t care about the environment due to personal values or economic circumstances.
Many of the changes driven by the LOHAS consumer can be seen in the United States today. Hybrid cars have moved from being an odd car to being accepted as just another car or even a car of choice; organic food can be found in many conventional grocery stores; green buildings and design are considered the gold standards of construction; yoga and meditation classes are offered at many fitness clubs; and the awareness of synthetic ingredients, and the desire for more natural and organic options in spas and skin care companies is common. If you look for the patterns in various markets, you can connect the dots to see there is a large current pulling these things into society, and that current is LOHAS.
An international movement
This movement is not limited to the United States; in fact, it is much larger globally. KarmaKonsum is a German marketing and branding company that organizes a German LOHAS conference and brings together 400 German-speaking businesses to learn and expand the German LOHAS market. Australian-based Mobium Group, a team of marketing researchers and consultants, conducts studies about LOHAS consumers in Australia and estimated the segment to be worth $15 billion in 2008, with potential growth to $21 billion by 2010. But nowhere else in the world is LOHAS more prominent than in Asian markets.
The Japanese were introduced to the term “LOHAS” five years ago and, according to a report by Japan-based firm E-Square, the term is understood by 60% of the Japanese population. Japan has LOHAS-branded restaurants, bottled water, apparel and sale specials. LOHAS-branded items have also entered into Hong Kong where LOHAS Park, a mass residential area, is being developed by MTR Corporation, a public transit company. There are LOHAS-titled department stores in Taiwan and China. Do a Google search for LOHAS hotels, and you will find them in the Philippines and China.
The second China LOHAS conference was recently held in Beijing, and a LOHAS certification is needed for natural and organic products to be imported into Korea. Perhaps the term has spread so rapidly because LOHAS captures traditional Asian values in a western concept during a time of middle-class growth and increasing awareness of environmental hazards. The fact that it is used so often in Asian marketing efforts can result in LOHAS-washing, which has some of the abusive characteristics that greenwashing has in the United States. However, a rising tide raises all ships, and if there is more awareness of the LOHAS concept, more people will be attracted to the essence of its true meaning.
Although the United States can learn from the respect Asian countries have in regard to nature, the country’s acceptance of the LOHAS ideals probably will not evolve the same way because there are many differences in the evolution of each society. LOHAS provides a modern package to a traditional theme in Asia, which makes it so attractive, particularly to the younger generation that is influenced by pop culture and societal values.
The LOHAS mind-set
What does this mean for the personal care industry? A lot. Despite the global economic downturn, studies show that the demand for LOHAS-oriented products has remained consistent.1–4 Globally, consumers are becoming more aware of what they put on their bodies, and what they place in their surroundings. The desire for natural and nonsynthetic skin care that performs is continuing to increase. LOHAS consumers want to also surround themselves with LOHAS products, and the growth of green cleaners the past year is testament to this. Green building has exploded, and the awareness of off-gassing—the evaporation of volatile chemicals in nonmetallic materials at normal atmospheric pressure from paint, carpet and furniture—is increasing. Clearly, if a company can look beyond its own market and see the advancements in parallel markets, it is likely to attract its customer. Marketers who can understand these shifts toward an increased LOHAS mind-set can remain fresh and relevant to consumers, and remain competitive in the marketplace.
(All accessed Jan 11, 2010)