State of the LOHAS Consumer Segment: Answers from the Natural Marketing Institute

It’s a question that all businesses are curious about:  who is buying their products?  Steve French, of the Natural Marketing Institute, gave a presentation at one of the opening sessions of the LOHAS Conference on exactly this subject.

The consumer segment, French said, is broken down into a number of subdemographics.  It is akin to a spectrum of consumers, from the deep green to the light green to the non-green.  Understanding these consumers and their purchasing behaviors is crucially important to companies working in the sustainability field and marketing sustainable products and services.  What drives purchasing decisions?  How many of these people are out there?  Are the trends in green consumerism growing?  Are they growing quickly enough?

French took a stab at answering some of these questions by delving into the research that NMI does.  The first segment is the true LOHAS consumer. They are in this thing for personal AND planetary health.  They are concerned about things like climate change and other environmental issues that don’t necessarily impact their day-to-day lives or have a direct personal benefit.  It’s the only group that describes itself as eco-friendly.

The next segment is the Naturalites. These folks are less concerned about “green” as they are about their own personal health.  If recycling is convenient, they’ll do it.  They feel discouraged about the individual’s power to make change.  They see politicians as corrupt, see problems within the system that prevent them from feeling empowered.  They will pay a little more for eco-friendly products and services, especially if healthier.  They tend to be grounded in holistic health…for instance, they will allow infections to run their course rather than immediately jumping to antibiotics.  They tend to be fearful and worried, spiritual, courageous and happy go lucky.

The next segment NMI measures and classifies is referred to as “the Drifters”. Their attitude is fairly good about the environment, but their behaviors not deeply rooted.  They tend to be more driven by trend and fashion, conspicuous consumption–they want the ‘green badge’.  They are heavily price sensitive.  French quipped that they might shop at Whole Foods because they want to be seen there.  They tend to think there are things that are far more important than the environment.  See Al Gore as a figurehead of radical change, whereas those in the higher categories might view him more as mainstream.  They wonder about ‘green claims’, and show characteristics of being fearful, depressed, and self-conscious.

The final group that is part of the overall LOHAS demographic is what they refer to as Conventionals.  They’re rooted in practicality, reducing waste, energy and water.  They’re heavy recyclers (not in blue bins, but more like clothes swapping).  They’re driven by cost savings, and eco-benefits are secondary.  Many in this group think ‘organic’ is just a marketing scheme, indicating no real understanding of standards.  They tend to be patriotic and doubtful.

These four segments account for about 80% of the all consumers.

The final group, which they dub the Unconcerned, are not necessarily against the environment, but not engaged in protecting it.

NMI”s research shows that from ’05 to ’09, growth occurred in the middle categories:

  1. Top LOHAS, deep-green group:  17%-19%.
  2. Naturalites:  21%-15%.
  3. Drifters:  19%-25%.
  4. Conventionals:  20%-24%.
  5. Unconcerned:  21%-17%.

This movement makes some sense with the current economic climate.  Conventionals, in particular, are all about saving money.  They’re likely to hang up a clothesline to save money, and during a recession, it is not particularly surprising that this group grew.  In addition, the Drifters group grew substantially, indicating that green may be becoming more and more fashionable.

Scott Cooney, Principal of and author of Build a Green Small Business: Profitable Ways to Become an Ecopreneur (McGraw-Hill, November 2008), is also a serial ecopreneur who has started and grown several green businesses and consulted several other green startups. He co-founded the ReDirect Guide, a green business directory, in Salt Lake City, UT. He greened his home in Salt Lake City, including xeriscaping, an organic orchard, extra natural fiber insulation, a 1.8kW solar PV array, on-demand hot water, energy star appliances, and natural paints. He is a vegetarian, an avid cyclist, ultimate frisbee player, and surfer, and currently lives in the sunny Mission district of San Francisco. Scott is working on his second book, a look at microeconomics in the green sector.In June 2010, Scott launched, a sustainability consulting firm dedicated to providing solutions to common business problems by leveraging the power of the triple bottom line. Focused exclusively on small business, GBO's mission is to facilitate the creation and success of small, green businesses.

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