Smallbiz

Alf Nucifora As an immigrant to the United States, I can say, admittedly with some bias, that this is the greatest country in the world. Most Americans would echo that sentiment. But the abundant degree of self-belief in our own superiority is both a major strength and weakness. Nowhere is this more evident than in our attitude toward ethnic citizens, both as a nation and as marketer. As a nation, we are woefully ignorant of most things foreign. From xenophobic politicians to inadequately taught high school students who can’t distinguish between Athens, Georgia and Athens, Greece, there seems to exist a cavalier air of disinterest about our ethnic brethren. Case in point: outside of cable’s Discovery and Travel channels, media coverage of ethnic cultural activity is sparse. But ethnic audiences represent massive business opportunities. It is estimated that ethnic spending power totals $500 billion annually. Ignoring for a moment the African-American community, a separate column in its own right, the major ethnic communities in the U.S. comprise Hispanic (Latin America, Mexico, Cuba), Asian (predominantly China, Korea, Japan), the Indian subcontinent (India and Pakistan), the Middle East and Europe (primarily eastern European countries and Russia). Looking at two particular sectors, Hispanic and Asian, the numbers are startling. The nation’s 22 million Hispanic-Americans are responsible for a household growth rate in the 1990s that is outpacing the general market by 4-to-1. Hispanic disposable income is increasing three times faster than the general market over the same period. In addition, approximately 7 million Asian-American consumers represent close to $225 billion in purchasing power. Space prevents the discussion of every ethnic sector, but two examples, Asian-Americans and the Indian and Pakistani communities, will highlight some interesting insights into ethnic marketing. What do we know about them? For one thing, they represent incredible buying power, both as a purchasing bloc and as individual consumers. Since many initially came to the United States to study, they tend to be very well educated. In fact, education is one for the most highly revered attainments within those cultures. They’re exceptionally hard working and goal oriented. They also tend to be more honest and ethical than most, with a low default rate on business loans, as well as with personal financial commitments. They’re also very entrepreneurial. Currently, for example, 55 percent of budget hotels in the U.S. are owned by Indians. The corner store retail environment, from convenience store to dry cleaner, is now owned, managed and run by Asian, primarily Korean, merchants in most major cities. Fast-food franchises from Blimpie to Dairy Queen are being gobbled-up by Indians and Pakistanis who are using these entry-level retail opportunities as a way of securing their American Dream. How do we approach them? If there is one distinguishing element of the ethnic market, it is brand loyalty. Ethnic consumers tend to be much more brand loyal than mainstream Americans. Once loyalty has been established, the consumer will maintain the relationship with the brand in many instances over a lifetime. Some of the smarter big boys are learning how to play the game, including AT & T;, American Express, CitiBank, MCI, and a few of the larger and more sophisticated insurance firms. All of these companies understand the potential inherent in ethnic marketing and have specified strategies and funds precisely for that purpose. Smart marketers understand that mainstream media is ineffective as an ethnic advertising carrier. Ad agencies, lacking verifiable data, tend to ignore ethnic media. With so many languages and cultures to address, the smart marketer will seek language specific media, both broadcast and print, as a way to communicate the brand message. The sheer fact that a company advertises its products in ethnic media is in itself reinforcement of the brand loyalty equation. Ethnic consumers will reward those who ask for the order in their native language. But remember: while first generation ethnic consumers are committed to print, their sons and daughters, like their mainstream peers, are big electronic media followers. High-end brands carry added cachet and many ethnic consumers, particularly the Japanese, will pay dearly for the right to carry a Prada bag or wear a Hermes scarf. They are quality conscious and will pay the price, whether it’s 22K gold in the jewelry they wear, or the predominantly foreign brand of automobile that they drive. Yet, they’re price-conscious as well. Money has been too hard to make to be frittered away indiscriminately. They’re intelligent consumers who expect real value for the purchasing dollar. The advice for any ethnic marketer is simple treat the marketplace as you would any niche market. Understand the culture. Life insurance companies have learned to appreciate this fact. That’s why they employ ethnic salespeople who successfully sell within their own communities. To that end, be willing to hire ethnic personnel or engage ethnic consultants to help formulate and implement strategy and direction. To ethnic communities, relationship is everything. Relationships are made and strengthened by understanding and appreciating the culture and making an effort to engage ethnic consumers on their own ground. Therefore, be prepared to invest in event sponsorship. It’s a classic case of dollars being put to work at the ground level within the community. And, ethnic consumers will reward that investment with additional brand loyalty. Get involved in ethnic community groups, civic and trade associations and any environment where leaders and influential business people congregate. Because of the commitment to family and leadership in these cultures, personal referral and word-of-mouth becomes an important strategy for spreading the message. We can no longer afford to be either ignorant or disdainful of the ethnic consumer. In the new millennium they will constitute a consumer juggernaut. Smart marketers will put prejudice and disinterest aside and look carefully at this rising opportunity that has been ignored by most to date. Where to Get Marketing Help I’m often asked to provide recommendations for additional marketing reading, particularly as it relates to small business. The following will get marketing novices started and kept up-to-date. I’ll add to the list as new entries pass my desk. Here are some books that are loaded with valuable insights and actionable steps: “The 22 Immutable Laws of Marketing” by Jack Trout and Al Ries; “Marketing Warfare” by Jack Trout and Al Ries; “Bottoms Up Marketing” by Jack Trout and Al Ries; “Strategic Selling” by Robert B. Miller and Stephen E. Heiman; “Ogilvy on Advertising” by David Ogilvy; “Which Ad Pulled Best” by Philip Ward Burton and Scott C. Purvis; “Life’s a Pitch, Then You Buy” by Don Peppers; “The One-to-One Future: Building Relationships One Customer at a Time” by Don Peppers and Martha Rogers; “Conflicting Accounts, The Creation and Crash of the Saatchi Advertising Empire” by Kevin Goldman “Whatever Happened to Madison Avenue?” by Martin Mayer I lucked upon a great source of useable marketing information about the Internet quite by accident. It’s called Iconocast, a weekly newsletter for Internet marketing executives that is packed with trends, statistics, inside scoop and even job opportunities. There is a lot of marketing information on the Net, but most of it is not as user-friendly as Iconocast. For your free subscription log-on at www.iconocast.com. Get your hands on Social Change Briefs, published bi-monthly by Campbell-Ewald Advertising. It’s a handy summation of trend behavior affecting the American marketplace a concise, informative and enjoyable read for anyone who wants to know what’s going on inside the consumer’s mind. For information, contact 1-810-574-3400. Alf Nucifora is an Atlanta-based marketing consultant. He can be contacted via e-mail at [email protected], at his Internet site at www.nucifora.com, or by fax at 770-952-7834.