LOHAS consumers present new challenge to food industry
may no longer be enough to lure people to new food and beverage
products. Marketers may need to take another look at strategies for
capturing the attention of this important group, reports Jess
Halliday.
LOHAS ('lifestyle of health and sustainability') consumers make up about a quarter of the US population and are classified as those with strong environmental and social values who base many of their purchasing decisions accordingly.
"LOHAS consumers are attractive for a variety of reasons, including brand loyalty, influence over others and price insensitivity," wrote the authors.
But this year's study, published by the Natural Marketing Institute, highlights a 6 percent decline in these consumers' desire to be the first to try new healthy foods and beverages.
And, given their influence, this reluctance may reverberate down through the population, gathering pace as it goes until food companies start to notice a major dent in sales of new products.
Euromonitor statistics show that growth in sales of packaged healthy and better-for-you foods in the US peaked between 2003 and 2004 at 5.8 percent. In 2005, sales were projected to reach $108.5 billion, a 5 percent increase on 2004.
The annual growth rates are predicted to decline steadily over the next four years, from 2.9 percent in 2006, to 3.3 percent in 2007, to 2.9 percent in 2008, to 2.5 percent in 2009. In 2009 sales are expected to reach around 123 billion.
With more and more healthy and better-for-you products hitting the market in the past few years, consumers can afford to be a little picky about those they opt for.
And when they do give products a chance, LOHAS consumers' standards are very high: "Products needs to feel, taste, and perform as well as (or in many cases better) than their conventional counterparts," according to the report.
The report also identifies an increase in the role of the brand image in influencing purchasing decisions. As more products become available, consumers have a tendency to stick with brands they recognize, meaning that companies who got in on the act early have a longer legacy of consumer fidelity on which they can base their new launches.
Another possible explanation for the drop-off in interest in new products is that, for this group, health and wellness are not just 'internal' considerations, but include planetary concerns too.
Twenty-four percent of survey respondents drawn from the general population said that recyclable packaging was 'very important' in their food and beverage purchases (an 18 percent increase over the past two years); 29 percent said no genetically modified ingredients was very important (up 14 percent); and 34 percent said grown without pesticides (up 10 percent).
No trans-fats, low-cholesterol, fortified with vitamins and minerals and low fat also scored highly (32 percent, 32 percent, 30 percent and 30 percent respectively saying they were very important).
These responses indicate that marketers may do well to give equal emphasis to the health and environmental benefits of food products.
More detailed data and analysis of LOHAS trends is available from The Natural Marketing Institute.
