Brand Central Station

You have to give the Association of National Advertisers credit, it’s not like they’re not trying.

But no matter what they seem to say or do, American advertisers don’t seem to understand the importance of minority markets to their brands’ success or profitability. There seems to be only one answer to sum up the majority of the obstacles cited by ANA members in a recent survey which attempted to divine the rationale for the dearth of marketing initiatives aimed at including minorities.

Ignorance.

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One of the greatest challenges (and most fun thing) about being an account manager is that clients often look to you when it comes to growing their business. They want answers to their questions or, at the very least, suggestions on what to do next.

And the one thing they don’t want to hear is that everything they’re planning to do looks great and you’d be glad to implement it for them.

(Aside: I used to work with a creative director that called AE’s who just nodded in agreement with the client and brought the work back to the agency, “parrots” and had a picture of a pirate with a big, nasty parrot on his shoulder. I knew when I was in trouble for being too complacent because my name would be pinned to the parrot.)

As a point of fact, you owe it to your client to think about all the markets that hold potential for them. If that requires a little extra research (whether it be reading or actually spending time in the community), that’s a small investment to make in a relationship. Exploring the possibilities presented by ethnic or minority markets is a great example.

Once you understand the media landscape for various ethnic groups, you should begin to see the potential for opportunity. Broaching the subject with your client, however, can be a tricky proposition. Here are some tips on how to do that:

1) Collect market information from the client that would help you identify the nature of the relationship they currently have with a specific minority group.2) Investigate the market potential online. There are plenty of online databases and resource groups that can provide insights into almost any aspect of the major ethnic groups in the USA.

3) Talk to/interview a handful of people that fit the ethnic profile of the group you’re interested in. Try to capture, in their words, why your client’s product or brand is important to them.

4) Prepare a presentation that explains the differences in perceptions and perceived advantages of your brand (and, ideally, the competitions’ brands) from the point of view of the ethnic market(s) in review.

5) Find allies (other agencies, freelancers, journalists, etc.) who accurately represent the point of view of the customer. Make sure they’re integrated into your team.

When you present your findings and recommendations, be prepared for a two-part reaction. At first, the client might seem interested and gracious – at least in the presence of guests. After your allies leave, though, be prepared for the hard questions to come out.

Clients who are comfortable with the white, mainstream media, are often uncomfortable with considering ethnic marketing opportunities. Ironically, the initial reaction (and it’s more common than not) is that marketing through ethnic media or with customized messages is “pandering” to one group or another. In fact, this couldn’t be further from the truth.

You need to point out the benefits of cross-cultural branding and the application of the same principles inside our own country.

Despite their own discomfort, clients will take your recommendation under consideration. Be prepared to play a waiting game on this kind of opportunity, but keep bringing it to the forefront – especially if a competitor takes advantage of the opportunity before your client.

The sooner you can get your client thinking about the entire market, the better your client will fare (and the more work for your agency and its partners).

Doing the right thing isn’t always the easy thing to do. In fact, it rarely is.

The majority of American businesses today only show a passing interest in understanding and pursuing ethnic marketing opportunities. In a recent survey conducted by Brand Central Station, 59% of the business executives we interviewed said they would rate their own company’s efforts in this area between “Poor” and “Okay.” Hardly a ringing endorsement.

“We simply do not target ethnic/minority clients,” explained one account manager for an advertising agency in the Midwest. “That is not typically a factor in seeking new business. However, if we would, we would be at a perceived disadvantage since we are a white, male-owned business, with no ethnic/minority employees …” (more…)

In cultural terms, the American culture is unique. Given the time in history when the first European settlers came to the new world, the Americas – and the United States in particular – have developed multi-ethnic cultures that are highly adaptive, very creative and, without question, confusing. (more…)

The medium you choose can be just as important as the message when making your brand’s appeal to minority markets. Spanish-language media in the United States is continuing to grow – reflective of the dynamic growth of the market domestically. Similar statistics for market and media growth can be found in the Asian-American community.

Can companies that specialize in selling to other businesses find legitimate opportunities related to cultural diversity and ethnic markets?

The question itself indicates a subtle ethnic bias that most white business people can’t see. But while white business owners may suffer from an ethnic blind spot, minority-owned businesses have more to do to bring attention the opportunities they represent.

First, for traditional B2B companies (usually owned and operated by whites), understanding the diversity of the American business culture as well as the consumer culture can yield a fresh perspective and new opportunities in a variety of areas:

Employment – Minority groups today account for 25% of the US population. That number will more than double over the next generation. The ethnic shift is likely to be even more pronounced among those people of employable age.Employers who recognize this trend and work to develop corporate cultures that are more open and accessible to people of various ethnicities will be positioned to review and select from a significantly larger talent pool of job applicants. An additional benefit to such an employer would be the positive “word of mouth” within various ethnic communities – resulting in a likely reduction in employee recruiting costs.

Client Relations – Just as it is likely most B2B companies’ own employment base will change over the next generation, it is fair to assume the employment profile of their clients’ will change over time as well. The ethnic/cultural background of your key client contacts may necessitate a change in your company’s approach to cultural diversity.

Growing and Start-Up Businesses – Today, ethnic businesses are growing faster and increasing spending more quickly than the national average for all businesses. Minority start-ups outnumber white start-ups by a ratio of nearly 2:1. Sales for minority businesses are growing at a dynamic rate of nearly 24% per year.

Healthcare and Related Markets – The health needs of some minority groups are more pronounced in some areas (e.g. Hispanics and the incidence of diabetes, African-Americans and the incidence of heart disease). While these tendencies have been identified by several drug and device manufacturers, there are several opportunities for companies who produce goods that support the lifestyle changes that go along with treatment. Food companies, financial service companies, technology companies, etc. can all benefit from getting to know and understand the needs of these markets in greater detail in order to stimulate more sales and product use.

Pull-Through Opportunities – Identifying cultural opportunities in the end-user market can create new business opportunities with existing customers.

For minority-owned businesses, there are a few significant challenges they need to overcome in order to break through the “checkmark” mentality so many white-owned businesses have when it comes to accommodating ethnic markets and minority-owned businesses.

Awareness – Opportunities in minority and ethnic markets need to be brought
forward and explained to companies that have traditionally operated in “the mainstream.” And with the mainstream, nothing succeeds like success. A coordinated push of positive examples and subsequent opportunities will get noticed by the more savvy entrepreneurs.Education – Many white business owners and managers are intimidated by cultures they don’t understand. The only way to overcome those fears is to spend the time required to educate and inform them.

Partnership – True partnership is a two-way street. Inter-racial business relationships need to start out slow, allowing the white partner to catch on and catch up. Both parties need to make their intentions clear and to put matters of difference on the table so they can be addressed. A clear understanding of the give and take of the business relationship will help make a stronger, working partnership when things finally hit their stride.

Finally, it’s up to all of us to recognize and celebrate the success stories. We all need to do what we can to commend businesses that find new ways to work together and benefit from the partnership. These stories will be of interest to the media and to the public because as the population continues to diversify (ethnically), the media will be searching for ways to entertain and inform that new public.

In the B2B segment, there is a distinct opportunity to lead consumer trends and benefit both strategically and economically as a result.

In the past, most of America was white and European. As people immigrated to this land (either on their own will or in chains as slaves), America grew to be “a great melting pot” of cultures. Ethnic groups were expected to assimilate into the “mainstream.”

Nobody was supposed to rock the boat.

I suppose that theory works great if other than their religion or maybe an accent, everyone looks pretty much the same. The problem is that by the mid-1800’s immigrants to this country were looking different than the white majority. Freed slaves were black. Laborers from the orient were from a variety of Asian cultures. Hispanics came from a tremendously diverse array of countries and cultures. And none of these groups wanted to melt into the American culture and lose their identity in the process.

By the time of the civil rights movement of the 1960’s, it was pretty clear that America was moving from “melting pot” to “multi-cultural society.” But by the time of the riots and protests about and for civil rights, much of the white population of America decided to ignore the situation, safe in the assumption that they would always be in the majority.

Well, that equation is about to change.

According to the US Census bureau, the US Hispanic population is growing at a rate that will make it the number two population group by 2010. By 2040, the US population will be so ethnically diverse there won’t be a majority race. Whites will be in the minority just like everyone else.

Economically speaking, minority households are catching up to white households as well. According to the US Small Business Association, African Americans, Hispanics and Asians currently represent about $600 billion in annual buying power. Minority-owned businesses are growing faster than the national average, as well. Sales dollars for minority businesses grew by 24% each year according to a study conducted by Conning & Company.

The market is growing. That much is clear. But why and how does a business engage in a campaign directly aimed at this market? Let’s start with “why”:

The growth of minority businesses and affluence in minority markets is appealing, yes, but businesses often raise concerns over the fragmented nature of the minority market and the many, many languages that pose a barrier to clear confusion and work towards understanding.

The fragmented nature of ethnic markets in the United States can actually work to a marketer’s advantage. In many cases, the specific market in question often has one or more media serving it. Although finding the media might be a bit of a challenge, working with the media to gain coverage (editorial) and to purchase space (advertising) should be relatively easy. Once you’re partnered with the media, you are in position to get the market’s attention. All you have to do is make sure your message is relevant.

Andrea Ogunkoya, a business writer and author of the book “Minority Marketing” adds emphasis to the idea of relevance:

“…marketing agencies have largely got no idea how to target this sector and have been getting it wrong for years. In order to understand this market, you have to be willing to invest in them. Not dusting off the crumbs from your marketing budget, but breaking bread with them.”

The good news is that media placements in media owned and targeting ethnic minorities has higher viewership/readership numbers inside their community. More than 70% of ethnic minorities polled recently, said they considered their community paper/media outlet to be their local news as opposed to the mainstream networks.

As you work towards establishing a clear idea of where the market sits and the unique obstacles it faces when it comes to forming a relationship with your brand, you’ll see opportunities to reach out and connect with this market. Here are some examples of what other companies have done to establish a connection into the ethnic market (courtesy of the SBA):

• Carnival Cruise Lines has dedicated an entire cruise ship called the Fiesta Marina to the Hispanic Market.
• J.C. Penney offers linens with bold African prints and cosmetics designed for women of color.
• General Mills became the first cereal company to introduce a product specifically for Hispanic consumers. It’s called Bunuelitos after a sweet Mexican pastry.
• Several insurance companies worked with their minority agents to develop products and services specifically for those markets.

And the list goes on. What are you going to do to get your brand on the list for next year?

Technorati Tags: Marketing, Advertising, B2B Marketing, Ethnic Advertising, Minority Marketing, Client Management, Leadership, Creative Thinking, Culture, Cultural Diversity

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