Planning for 2014: Don’t Do it for the Multiculturals, Do it for the Money

Decision makers always want to know how to get the biggest ROI from multicultural markets, and that answer is simple:  if brands truly invest— allocating time, money and assets to the effort—the market will provide them the biggest return. With the summer speeding by and companies finalizing their planning strategies for 2014, considering how to allocate budget dollars towards multicultural efforts is good food for thought. More and more brands are acknowledging the ever-growing multicultural consumer presence in this country. When the 2010 US Census was published, minorities made up 35% of the national population (with Hispanics making up 16.7% of the US population). As many companies have already noticed, this particular population growth translates directly to the consumer market. In 2012, for example, the estimated purchasing power of Hispanics was $1.2 trillion. This number is expected to reach $1.5 trillion in 2015. Those who plan to invest can tap into that enormous spending power. “Don’t treat multicultural efforts like the middle child, paying attention to it after you’ve spent time with the other kids and when it’s only convenient for you,” says George L. San Jose, president and chief creative officer at The San Jose Group. “In order to win the multicultural dollar, brands have to plan to invest in the market as well as follow through with that plan. Otherwise, those consumers will fall through the cracks just like the forgotten middle child.” Hispanics and other minority groups such as African Americans and Asians will not be minorities for long, a fact that renders the decision to allocate a significant portion of a brand’s budget toward multicultural efforts very wise, if not necessary. In recent years, many companies have taken advantage of this opportunity by increasing multicultural spending and creating campaigns geared toward minority consumers. The results, overall, have proved successful. One notable example of a successful multicultural marketing strategy comes from Walmart. In 2012, the world’s largest retail corporation announced plans to double its multicultural ad spending as part of a...

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Five Tips for Communicating Effectively with Diverse Audiences

By Ebonne Just, Account Supervisor- Public Relations It’s no secret. The United States is becoming more racially and ethnically diverse reflecting the major influence immigration has had on both the size and age structure of the U.S. population. The Huffington Post recently reported that by 2043, there will no longer be a racial majority in the U.S.  Meaning, no single racial group will dominate the population. As professional communicators, it is important the industry recognizes this shifting demographic to ensure a brand/client’s message remains compelling and influential in today’s complex market. Here are five tips for communicating effectively with diverse audiences: Know your target audience As with any marketing assignment, the first step is to clearly identify the audience your brand is trying to engage. In multicultural communications this step is crucial. Beyond knowing the typical characteristics of your target (race, gender, age, income), it is important to understand this consumer on a deeper level. What drives them to achieve their quantitative and qualitative personal goals (family, wealth, religion/faith)? How do they view themselves as part of the total market (blue-collar, entrepreneur, spiritual leader, social advocate)?  How has race or ethnicity influenced their experience living in the U.S.? Understanding these cultural nuances- the characteristics that exist beyond general appearances which distinguish ethnic and racial groups from the traditional American ideal- builds a platform from which a communicator can deliver a credible message. Assess your knowledge/understanding of your audience Embrace the famous opening words of MTV’s celebrity biopic, “Diary”: You think you know, but you have no idea. While many of us may believe we understand complex cultures outside of our own, truth of the matter is, we probably know less than we think. Before setting out to influence or represent an ethnic audience, assess how much of your understanding is fact versus assumption. A misguided perception of any group can lead to offensive marketing/advertising such as in the case of Tecate’s ill-fated “Finally a Cold Latina” outdoor ad campaign whose critics felt “the ad...

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Education Statistics of Hispanics and African Americans Infographic

By Martha C. Rivera, Director, Strategy and Insights and Beata Luczywek, Junior Account Executive Education is a growing trend among multicultural markets. Today, a significantly greater portion of Hispanics and African Americans has a high school diploma than 12 years ago. Dropout rates from 2000 to 2012 have decreased significantly for all minority groups: Hispanics, Blacks and Asians. Furthermore, Hispanics are by far the largest minority group on college campuses 1 and these trends keep growing. The College Board predicts that from 2012 to 2019, the number of White college students will increase by 5%, while the number of Hispanic college students will increase by 27% 2. These minority groups’ gains in educational attainment indicate a need for institutions, such as schools and other businesses that offer educational goods and services, to establish programs specifically for these groups. “The expanding success of multicultural groups in education opens opportunities for many organizations,” upholds George. L San Jose, president and chief creative officer at The San Jose Group. “The organizations can expand their services to multicultural members of their community by playing a vital role in making dreams come true, while, at the same time, experiencing significant business growth – a mutually beneficial...

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11 Million More Reasons to Market to Hispanics

By: George L. San Jose, President and CCO of The San Jose Group Major advertisers will soon have approximately 11 million more reasons to establish a robust multicultural marketing program. For the second time in thirty years, the Hispanic population in the United States could grow by millions overnight. As the government continues to devise a plan for documenting immigrants—who are energetic consumers and large contributors to the $1.4 trillion Latino spending power, but not included in any of the demographic or physiographic information used by marketers to allocate budgets and resources—marketers must proactively connect with this rapid growing and ever powerful Hispanic consumer, or face a declining market share. Hispanics make up 16.2 percent of the overall U.S. Population and, most importantly, account for an average of 37 percent of the population across the U.S.’s ten largest DMAs. With immigration reform, these numbers will surely surge again. In the 1980s, millions of undocumented immigrants who gained legal status in the U.S. through the Immigration and Reform Control Act were active consumers yet ignored by marketers who based their budgetary decisions on published reports instead of the U.S.’s actual population size and demographics. Retailers and merchants in Hispanic communities benefited from the strength and the power of these undocumented residents. For example, during this time small Hispanic supermercados (also known as “bodegas”) outperformed large general market grocers by a 3:4 ratio on many well-known American products when marketed in-language. When Congress passes fair and sustainable immigration reform legislation, the U.S.’s Hispanic population could reach upwards of 60 million with nearly 55 percent residing in the top ten DMAs. Most importantly, the largest percentage of this population speaks and consumes media that is culturally relevant and offered in their preferred languages. Altogether, this reformation creates marketing opportunities for TV and radio broadcasters, online/mobile marketers and overall marketing communication strategists as more advertisers seek to reach this growing consumer group. The Hispanic segment will now be visible and real, showing up in consumer research data as well...

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Ethnic Buying Power: Population Growth and Income Infographic

By Martha C. Rivera, Director, Strategy and Insights The estimated buying power that U.S. multicultural consumers will attain by 2015 is more than three trillion dollars. Marketers have realized long ago that the buying power of the Hispanic population grows significantly from year to year. However, many are not aware that the buying power of some other minority population segments, particularly African Americans and Asian are also on the rise.  It has been estimated that the Hispanics buying power will increase by 50%, while the African Americans and Asians spending power will grow by 25% and 42% respectively.  The resulting disposable income should spark the interest of marketers in their brand’s minority audiences. “The enormous growth of the disposable income amongst multicultural segments of population is something that marketers across the country should realize in order to explore creative ways to reach out to these important population segments. The figures shown in the attached Infographic speak by themselves,” said George L. San Jose, president and chief creative officer of The San Jose Group....

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Don’t Drink the Kool-Aid: Marketing to the Reality versus the Buzz

By: George L. San Jose, President and CCO I’ve been in the marketing and advertising profession long enough to see the good, the bad and the ugly. I’m well aware of the kid gloves typically used when broaching the topic of multiculturalism in today’s market. Committing to the spirit of new media, where everyone has a voice that deserves to be heard, I write this post from an open, honest heart reflecting my personal voice – independent of the agency. Advertisers who base their budget decisions on marketing to the “same old” might consider catching up to today’s market reality instead of marketing to their own likes and likenesses. There is a “not so new” American consumer and if you haven’t acknowledged them yet, ask the Republican Party why they lost the presidential election. In Mitt Romney’s first interview with the Wall Street Journal since the election he said, “We weren’t effective in taking my message primarily to minority voters — to Hispanic Americans, to African Americans, other minorities.”  Yes, just that straight and simple. Not surprising to anyone attuned to today’s complex markets but very surprising to the advertisers of yesteryear. Let’s put this in perspective. Currently, an estimated 90-95 cents out of every dollar spent by major advertisers is directed towards marketing to the diminishing “same old” (known in the industry as the “general market”). You know who I’m referring to, the same old group of monolingual, monolithic consumers with similar interests, living in the same neighborhoods and consuming the same proliferated media. For brands campaigning to win, here is a simple set of profiles to evaluate your company’s grasp of the market reality: ・ Generalist: Those who do nothing towards multicultural audiences because they do not want to take the risk of allocating scarce resources to the unknown.  As a result, they cling to the safety and predictability of their externally controlled declining market share. ・ Buzz Makers: Those who talk about it, brag about it, and even have multicultural departments in charge of protecting their state secrets but...

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