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The LOHAS Market

OK, maybe it isn't fair to headline a story with an acronym. At least it got you to read more. LOHAS stands for "lifestyles of health and sustainability" and describes a market segment of approximately 30% of adults (and possibly greater percentage of children) interested in:

• Natural, organic and nutritional products
• Renewable energy
• Socially responsible investing
• Complementary and alternative medicine
• Recycled and ecological products
• Other socially responsible products

Defining customer segments as lifestyle segments such as LOHAS is much more informative than demographics are for understanding customer preferences, wants and values. Identifying a lifestyles segment enables you to target products and services to meet customers' values and preferences and to connect emotionally with them (see last month's article It's the Personality that Counts).

When it comes to restaurants, this market segment doesn't dine at fast food restaurants. It's not your burgers and fries crowd. However, LOHAS consumers are big spenders in dining. To attract them requires "organic," "free range," or "all natural." However, everything on the menu need not be organic. Some mentioned organic items, strategically marketed, can leave a lasting impression with the LOHAS segment. Examples include a burger produced with all-natural nonmeat ingredients, some vegetarian items, the use of trans-fat-free soybean oil and fair trade coffee. Have any doubts? Just take a look at Starbucks. Soymilk is one of the options they offer to help capture the LOHAS market segment, along with fair trade coffee practices. Or look at the recent move of McDonald's to offer Newman's Own all-natural ingredients salad dressings.

LOHAS is the market segment supporting the rapid growth of natural food supermarkets, including Whole Foods with 156 stores and Wild Oats Markets with 102 stores. That's no small market to sneeze at!

Food is not the only way to appeal to this fast-growing lifestyle segment. Recycled paper products, recycling, the use of real silverware and dishes instead of plastic and paper (part of Panera's strategy of appealing to this market), "green" building practices and other environmentally friendly and socially conscious practices all appeal to LOHAS.

Just practicing LOHAS' values and offering its preferred products are not enough. You also need to market your organic, vegetarian and environmentally friendly products and practices, as well as have a well-informed staff. Hearing, "I don't know," from employees will alienate the LOHAS market. Lack of information or misinformation is a definite turnoff. They want information about allergens, preservatives, vegetarian or vegan ingredients and nutritional information. They want to know exactly how your company acts in a socially responsible manner.

LOHAS customers are a primary target for any location-based entertainment (LBE) facility, as they are well educated with plenty of bucks to spend if you offer them services and products they want and practice socially responsible behavior. In fact, this market will often pay a premium to companies that act in a socially responsible and healthy manner by trading up to LOHAS-valued offerings (See last month's It's the Personality that Counts for discussion of trading up to New Luxury products). Customers who value health, environmental stewardship, social justice, personal development and sustainable living represent too important of a lifestyle market to be overlooked.

And it you think it's only the adults who matter, you've somehow missed moving into the Third Millennium. It's more often children who first acquire these values through mass media and their education, and they bring these values home to teach their parents. Children have a major influence on LBE visits and many are aggressively promoting healthy and socially responsible purchase decisions to their parents.

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