Say hello to LOHAS
Editor’s note: Brent Green is president of Brent Green & Associates, Inc., a Denver marketing communications firm. This article is excerpted his book Marketing to Leading-Edge Baby Boomers: Perceptions, Principles, Practices, Predictions.
Mark Joyous is athletic, personable, unfaltering and deeply committed to the natural environment. A former naval officer and national park ranger stationed in the Redwood National Forest, he understands and appreciates pristine wilderness and responsible land development better than most. He has made his living during the last 20 years as a Colorado real estate broker specializing in mountain properties, with an underpinning ethos of environmental responsibility, team collaboration and community development.
Joyous’s primary mission in life is to help as many people as possible become aware of human interconnectivity across boundaries and around this precious planet, our blue orb’s fragility, and the looming threat to stability should humanity fail to evolve beyond self-serving boundaries and short-sighted natural resource exploitation. Like so many of his Boomer peers, he is deeply concerned about the ability of the planet to provide sufficient and sustainable natural resources for his grandchildren and their grandchildren.
He discovered his purpose while working with children in the Redwood Forest, becoming entranced by their innate awe of nature and thirst to learn about its mysteries.
His goal today is to help more people, children and adults alike, embrace a whole-planet perspective. One way he’s approaching this is through his philanthropic cause, EarthSeeds Project, a Johnny Appleseed-like approach for the new millennium. Several educational programs involve spreading “seeds” of a “healthy, harmonious, and sustainable living Earth.” He is developing fun, celebratory, positive approaches to environmental awareness instead of the countercultural approach of the ’60s that served to polarize as many people as it converted1.
As co-founder and executive director of Global View Foundation, a nonprofit organization which has grown quickly to become an international grassroots movement, Joyous is dedicated to high-impact education and empowerment by disseminating photographic representations of Earth as depicted on posters, flags, inflatable globes and other printed media. He believes that “to change the world, we must first change humanity’s global view.”
Joyous, an impassioned environmentalist, personifies a powerful marketing segment in the United States just uncovered since the beginning of the new millennium. This consumer segment has been christened LOHAS, an acronym that stands for lifestyles of health and sustainability2.
Although few people fully express and actively demonstrate Joyous’s unquenchable passion for our planet, the LOHAS consumer is represented by an eyebrow-raising 27 percent of the U.S. population. This group includes people who are ardently concerned about personal health and emotional well-being plus protection of the environment.
These are not citizens simply possessed by idealistic, ethereal values; they are consumers who make purchasing decisions based on how effectively companies approach product manufacturing and distribution with a view toward responsible resource utilization and long-term planetary accountability. Many are also committed to broader social issues such as protecting women’s, children’s and workers’ rights.
LOHAS consumers shop for energy-efficient electronics; green household products; organic and natural care personal products; organic and natural foods; hybrid automobiles; green building products; socially responsible investments; and alternative health care services.
Collectively, they purchase nearly $350 billion in goods and services annually, preferring products that meet their value-driven expectations for well-being, social justice, self-development and sustainable living. They are dedicated to the environment, systemic human health, spirituality and personal growth. They believe in the interconnectivity of all humankind on a macro scale and the integration of mind, body and spirit within the individual. Many envision themselves similar to a manifesto presented by Joyous’s Web site: “…as unique, independent Crewmembers of a Global Family united by the responsibility to care for the planet and all living things.”
The Natural Marketing Institute (NMI) originally quantified this new segment through research in 2001, initially by distributing a comprehensive survey to a statistically random and representative sample of Americans and then by analyzing survey data using sophisticated cluster analysis.
The firm’s discovery process analyzed 16 variables with a multiple regression model to identify the LOHAS segmentation. In addition to the LOHAS segment, NMI researchers discovered three other broadly-defined, tangentially-related consumer segments called Nomadics, Centrists and Indifferents. Although these three additional consumer groups reveal specific business opportunities and marketing insights, especially the Nomadics, further discussion about segments other than the LOHAS consumer lies outside the focus of this article.
NMI completed the third annual update of its wide-ranging research program in March 2004, based on a survey completed by 2,060 U.S. adults, a representative sample from a U.S. consumer panel of seven million people. The conclusions of this survey can be projected to the U.S. adult population, with a 95 percent confidence level and a standard deviation of +/-2 percent.
Discovery and description of the LOHAS market, and its surprising magnitude, has quickly led to a business revolution among proponents of responsible businesses across many industries. The LOHAS segmentation demonstrates the interconnectedness of a wide cross section of U.S. adult consumers, bound by similar values, and spanning an extensive range of product and service categories. Exemplary companies targeting this segment sell resource-efficient and healthful products such as organic foods, personal care products, green cleaning products and eco-tourism - among many others.
Moreover, this segment subsumes 55 million American consumers, 47 percent of which are between the ages of 45 and 64. It therefore doesn’t come as a surprise that many Americans who were still young adults during the inauguration of Earth Day in April 1970, and the modern environmental consciousness it propelled, correlate highly with the LOHAS segment. In raw numbers, over 26 million members of the LOHAS segment are also Boomers, born between 1946 and 1959, or members of the Silent Generation, born between 1940 and 1945.
Steve French, executive vice president and managing partner of NMI, emphasizes the sizable correlation between values identified in the LOHAS segmentation and those possessed by Americans 45+: “Our research findings substantiate what some companies and policy makers have assumed to be true for a long time. Many Americans reached adulthood in the 1960s and 1970s during the emergence of a global environmental awareness and greater focus on personal health, and they maintain those same values today, although they’ve become more sophisticated as consumers with the passage of time. The major difference today is that they have considerable financial resources and commitment to search for and buy products and services that serve their long-term environmental and health goals.”
Strong opinions
This research project further demonstrates that members of the LOHAS segment possess strong opinions, and they have a greater influence on the direction of the marketplace than average consumers.
Marketers can also take comfort learning that these consumers are fervently committed to their beliefs for the long run, and most product development and marketing strategies will stand the test of time. How they feel today reflects how they’ll feel tomorrow. Considering all four broad segments identified by NMI, LOHAS consumers are the most brand-loyal and the least price-sensitive.
Interestingly, of the 16 factors used to describe the LOHAS consumer segmentation, those willing to spend 20 percent or more for sustainably-made products earned a mean score of 4.1 on a five-point scale, with five being the strongest possible agreement level. This factor ranked third in importance of identifying the LOHAS consumer, led only by “choosing environmentally-friendly products” and “teaching family/friends the benefits of environmentally-friendly products.” An astounding 85 percent of LOHAS consumers are willing to spend 20 percent more for products that are manufactured using environmentally-sensitive and sustainable methodologies.
LOHAS consumers are behaviorally driven. As mentioned earlier, they are not just typified by expressed attitudes; they transform their attitudes into action. They pay more for products meeting their criteria; influence friends and family members to do the same; and choose products from sustainable and environmentally-friendly sources. Products must appeal to more than beliefs; products must appeal to LOHAS lifestyles. Members of this segment seek companies that truly align corporate values with their own values, and they are quick to spot “greenwashers” - companies that create facades and make feeble but insincere attempts to line up with environmental values.
NMI’s data analysis contradicts the widely accepted belief that younger people are more idealistic and therefore more likely to make consumption choices based on core values. Younger people are much more likely to choose products based on the lowest price.
The research once again dispels the myth that brand choices solidify with age. Clearly, older consumers are amenable to marketing communication approaches that address core values; strategically sound business approaches can and do influence brand switching.
More connected
As consumers grow older, they become more connected with values related to relevance, self-actualization, and legacies. Furthermore, as consumers age beyond 50, they tend to choose products and service providers that are environmentally-responsible and committed to human health; they buy from companies that share the same long-term values; and they choose products manufactured from sustainable resources.
Businesses interested in developing products and services to target adults 45+ have a significant business opportunity when targeting the Boomer/LOHAS consumer. Product development, marketing communication strategies and corporate goals can be aligned with values held by this vital lifestyle and attitudinal cluster, embracing their bedrock standards of health, self-development, environmental sustainability and social responsibility.
According to NMI researchers, LOHAS consumers are compelled by values to seek products and services that are health-promoting, environmentally-friendly and demonstrate a global social consciousness. A significant segment of leading-edge Boomers are equally compelled, having acquired and nurtured a sophisticated view of the planet - in a sense, the same panoramic view of Mark Joyous: an “astronaut’s view of the Earth,” a global family portrait.
References
1 Global View and EarthSeeds Project, co-founded by Mark Joyous and Robert Bogatin, as presented on the foundation’s Web site: www.earthseeds.net.
2 Understanding the LOHAS Consumer Report, published by the Natural Marketing Institute, Harleysville, Pa., www.nmisolutions.com. All references and discussion in this excerpt pertaining to the LOHAS consumer segment have been undertaken with permission from Natural Marketing Institute.