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The Markets Within the Masses
When marketers try to reach a particular demographic, the successes -- and failures -- reflect on all of us.
For the rest of the March 2008 issue of CRM magazine please click here
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I think of myself as the typical consumer: I do research; I make price comparisons; I take advice from my peers; and I am bombarded with ads. I never really questioned general-market advertising -- America's White-dominant, so the prevalence of ads designed for White America seems a natural consequence of the country's power dynamic. While multicultural marketing isn't new, it has yet to fully enter the mainstream. Perhaps it's my own cynicism, born of my college years, when we argued how a mere hyphen obstructed the nuances of our dual identities and how we actually had to fight for our history to be relevant. In any case, most of the "multicultural" campaigns I've encountered have left me unsatisfied -- and, to some extent, indignant. A brand campaign launched not long ago featured an East Asian girl studying and playing the piano. Afterward, her efforts were rewarded with a meal at McDonald's. At a multicultural conference last year, this commercial was applauded. All I could think was: That was obvious. Every Asian American I know has played either the piano or violin. I played for seven years before quitting -- to my parents' dismay -- under the pretense that I could only do so much without natural talent. Practicing the piano was part of a routine; even being bribed with McDonald's wasn't too far off. Yet despite the fact that I could see my own childhood in the commercial, I was offended. The creators of the campaign contend that any child could have been playing the piano -- but they walked a fine line choosing an instrument that is at the core of a specific cultural stereotype. And there's the danger: If stereotypes are rooted in truth, can you ever really avoid them? And to what extent are they just a reflection of our culture? The challenging part is that there are no overarching templates for multicultural marketing. Oftentimes, we're faced with campaigns that either fall short or try too hard. There are always going to be questions, and consumers will never be content -- forcing marketers into continually evolving strategies. When Jo Muse, founder of advertising agency Muse Communications, formerly Muse Cordero Chen & Partners, set out to target the multicultural market more than 20 years ago, it seemed like an obvious move. "We saw the population trends in California," Muse recalls. "For us, coming together to develop advertising campaigns was a natural thing." Today, however, Muse estimates that only 20 percent of the Fortune 500 companies employ some form of multicultural marketing, which suggests that the rest of the industry is likely further behind.
McDonald's was one of the major pioneers in this arena, featuring African American actors in a 1971 commercial that contributed to building the brand nationwide. Since then, many companies have attempted to specifically target the growing population of minorities, and while a few have been successful, many have failed -- and some miserably -- leaving those companies with the conviction that they were better off targeting the general market. But the multicultural market isn't going away -- and never will. Currently a third of the U.S. population, that share is projected to reach one-half by 2050. And with more than $1.5 trillion in spending power already, according to Larry Moskowitz, vice president of integrated marketing and business development at Global Advertising Strategies, the question isn't Should you target multicultural consumers? but Can you afford not to? Multicultural marketers have to perform like business superheroes. They have to be courageous risk-takers, willing to offer the next big idea, stand by it, and see it through until the end. Unfortunately, few get the chance to let campaigns take their course before being forced to show results. "We all believe that we have to do it very quickly," laments Ron Campbell, president of New York-based strategic research and consulting firm Campbell-Communications. "We've lost sight of how advertising started: It's something that happens over time...it was about changing thought that would hopefully evolve into changing consumer behavior." While justifying investments is the bane of any marketer's career, for the multicultural marketer the pressure is exacerbated. "When you look at how to reach people of color, it's the same way you reach general agency targets -- just more rigorous and more efficient," Muse says. With dramatically smaller budgets, more-intensive research, and less internal support, multicultural marketers are still expected to deliver the same results in the same amount of time, if not sooner. Targeting the multicultural market requires the same business sense that is the backbone of any company. "You'll want to go to your most profitable segments," says Brad Wilson, general manager of Microsoft CRM. Therefore, he believes, "it wouldn't be smart to not invest in the marketing that's appropriate to different cultures you want to connect with." While Muse agrees that it's unlikely that companies would irrationally cut multicultural budgets if that's where the revenue is, he worries that few marketers grasp that the ethnic markets may contain their most valuable consumers. Muse recalls a client meeting "not too many years ago" in which he explained the need to develop ethnic advertising; the client replied, "This all sounds very good, but it just seems too complicated." This misguided sentiment is precisely why multicultural marketing has taken such small strides in the American market. "[The general market] has been segmented to the nth degree," says Valerie Romley, author and chief research officer at San Francisco-based Moving Target Research Group. "Why marketers don't feel the value in doing that in the multicultural population, which is even more fragmented and diverse, I'm not sure." At the heart of the matter, the issues go beyond marketing -- they require a societal shift. For the most part, the heart of the advertising industry resides on the two coasts, "but 'the flyover space' is a rough-and-tumble area," Romley says, referring to the heartland in between. She suspects that the majority "is probably moving at the most it can handle." Even multicultural consumers show signs that they are conflicted when it comes to their role as subjects of marketing. One Asian American woman in her 20s tells CRM magazine that it doesn't matter to her if a particular product promises to create the shiniest, most voluminous hair -- if the model pictured on the box isn't ethnically Asian, she'll never believe it will work for her. At the other end of the spectrum, a 50-year-old man who immigrated to the U.S. more than 25 years ago says he's complacent with the fact that advertising doesn't directly apply to him. His reason? "Because I'm the minority and I have to adapt." Change Starts At The Top Because senior management support plays a crucial role in developing marketing initiatives -- especially multicultural ones -- companies will need to start by reorganizing their corporate structure and advocating representation from within. "The workforce and executive teams need to reflect the consumer," Armando Martin, director of multicultural marketing at grocery chain SuperValu, told the audience at the Association of National Advertisers' 2007 Multicultural Marketing Conference last November. "We need more VPs, SVPs, CMOs...that's when the change will happen." Ron Campbell says that, in his experience, the clients that are the most sincere and successful in multicultural marketing are those that have senior-level involvement -- that's where, he says, the "real motivation" comes from. "Part of the problem with multicultural marketing is that you can't intuitively evaluate it [if] you're not part of that market." As a result, says Janet Smith, founder and president of consulting firm Ivy Planning Group, most chief marketing officers lack the gut feeling that pushes them to think, "I need to do this." They're more likely to react to the competition, rather than pursue the market on their own. Without management support, the lone marketer is left to decide whether or not she can adequately defend a multicultural launch. The typical lifespan of a CMO is 18 months, Muse says, a relatively short period of time in an executive role; hence, they are more eager to grab the low-hanging fruit from the general market even if it only produces short-term results. But marketing shouldn't revolve around the numbers -- innovation and long-term success depend on creativity. The marketer/agency relationship is also crucial. Agencies want to give marketers valuable information and help them succeed as much as marketers need to give agencies inspiration. An independent agency trained to target specific markets, Muse says, can provide more creativity, more insight, and more experience. "When the CMO is fired and the agencies have been let go, they've basically failed each other," he says. This story rang true for Nita Song, president of Asian American advertising agency IW Group. With one client, Song soon realized that it lacked the resources, the intent, and the internal champion. "There was a huge burden on the agency to make up for the lack of client infrastructure," Song says, which in this case forced the agency and company to part ways. Unless it's a true partnership, she says, "it will never get the recognition or positioning it deserves." The Adversity of Diversity Whether you're marketing to the multicultural market or the general market, you have to understand your customers -- sometimes at the most basic level. "I've had advertisers say, 'Oh, we didn't know Asian people shaved their armpits,'" Romley says. Research is invariably the most crucial element in this entire process. "You should never use naive assumptions about people...it's got to be fact-based," Microsoft's Wilson says. Multicultural marketing requires more than just having a multicultural cast in a TV commercial. While this seems obvious, too many failed attempts are due to violations of the critical rule: Multicultural consumers are not homogeneous. "It's not enough to say, 'I'm a good person. I'm not racist. I'm going to cater to those markets,'" says Andrew Erlich, a consultant and psychologist at Erlich Transcultural Consultants. Research is the only way you can be sure your campaigns are relevant and your customers are receptive. And with multicultural marketing, the research becomes much more challenging. (Innovative Research is at the heart of any successful multicultural marketing campaign. For an inside look at what goes on behind the scenes, check out our exclusive extended coverage online.) The Color of Money "Budget is the number-one hurdle in terms of getting these plans launched," Romley says. Although budgets vary from business to business, experts agree that multicultural budgets are frequently given an unfair share -- in fact, they're often an afterthought, receiving funds from whatever is left over. "[Companies] tend to create sort of a general approach and the multicultural approaches have to fit into that," Campbell says. The logic behind this technique is dangerously flawed. In her book Beyond Translation, Romley describes how creators of the "Got Milk?" campaign made this mistake when they wanted to reach its Mexican audience. A marketing effort simply translated the slogan to read, "Tiene Leche?," which actually means "Are you lactating?" That lack of cultural awareness exemplifies the short cuts taken when reaching out to other cultures. It risks being not only highly offensive, but damaging to both brand image and customer loyalty as well. Admittedly, some marketing expenses have grown significantly. Campbell attributes this to the proliferation of media channels, the Internet, and social marketing. Due to these economic obstacles, however, he believes marketing isn't just developing slowly, it's undergoing a retrenchment that began five to eight years ago. Evidence of this is apparent in the "urban phenomenon," Campbell says, where companies mistakenly claim to relate to the African American market just because they speak the same language. "Just because you eat sushi doesn't mean you can serve messages to the Japanese," Campbell says. "It's much deeper than that." Marketing is often tempted by other short cuts as well. Take focus groups, for example: Instead of calculating the best combination of individuals, marketers often think it's enough to just sprinkle in minorities, even though a culturally homogenous group of people is far more likely to generate insightful discussions, Campbell says. Marketers need to resolve to make every dollar go as far as possible. "We try to do fewer, more integrated programs," says Isaac Mizrahi, director of multicultural marketing at Sprint Nextel. "We stretch programs over a longer period of time, and try to be very creative with the way we use our budget." The wireless-service provider has jumped with both feet into the tech-savvy Hispanic market as the exclusive wireless sponsor of Latin Grammy -- winning musician Juanes' 2008 American tour. Sprint subscribers can get exclusive mobile and video content, as well as early access to Juanes' latest album. Sprint recognized that its six million Hispanic customers represent an important part of its present and future business, Mizrahi says. Within a few weeks after the launch of the program, Sprint saw more Juanes music downloads and more video streaming on cell phones than any non-Latino artist. While Sprint is fortunate that its product is technology-based, Mizrahi admits that, like everyone else, he still faces budget issues. But how much should companies allocate for their multicultural budgets? "However much it's going to cost," Romley says, only half-jokingly. "You get what you pay for in all walks of life. It's not necessarily about spending the most, or going with the best. It's about having a genuine commitment to the marketing and doing what it takes, toughing it out -- just like [in] the general market." While Muse believes that there is a tendency for marketers to accept a general perspective, he feels that it's happening less and less. Still, despite the available technology and theoretical framework, there are reasons to believe that marketers are still not grasping the value of the ethnic market. In a recent survey conducted by Anderson Analytics, members of the Marketing Executives Networking Group ranked "multicultural marketing" as only the fifth-most-important area of concern, behind green marketing. Romley finds this highly disconcerting. "I'm all for green marketing; however, there are people with immediate needs," she says. "Maybe America is moving even slower than I thought." The multicultural population, by contrast, is moving quickly. "Think about the company that's not addressing the needs of the market," says Ivy's Smith. "People who said, 'This Internet thing's not going to work' got left behind.... You can adapt quickly, or you can hold out -- but eventually, you're just not going to make it." The idea isn't that you should be in the multicultural space just to be politically correct or active. It's about knowing that a specific audience will help you generate revenue. When it comes down to it, says Global Advertising Strategies' Moskowitz, "The only color that really matters is green." SIDEBAR: Three Types of Multicultural Campaigns Ron Campbell, president of Campbell-Communications, provides examples of advertisements that fall under three general categories, in order of decreasing effectiveness: Targeted, Inclusive, and Token. The Technique: Targeted Most effective; directed to a specific audience; resonates on a more personal level. The Campaign: In 2005, Verizon Broadband's "Realize" campaign was an effort to reach the African American communities in Philadelphia and Washington. Creative elements featured real people who rely on Verizon Broadband's services to aid in the pursuit of their entrepreneurial endeavors. Language and cultural services expert Nikki O'Dell was photographed with a stack of language dictionaries and a slogan that read, "Realize: Success Translated Globally." Other, more general slogans were simple, yet powerful, such as "Realize Potential," featuring a picture of boxing gloves. The Technique: Inclusive Works well as a general message; not necessarily culturally targeted, but delivered by a person culturally relevant and important to the group; features minority actors in lead roles rather than secondary ones, adding to relevancy. The Campaign: African American actor Dennis Haysbert is the current national spokesman for insurance company Allstate. "He's an appealing celebrity in general," Campbell says, "but certainly the African Americans identify with him." The Technique: Token Least effective; what Campbell calls the "Oh, by the way" technique; a minority is merely thrown in without particular rhyme or reason. The Campaign: When General Motors cast Mary J. Blige in its commercial for the Chevy Tahoe, Campbell says the ads underutilized her. "It was just another celebrity in a commercial," he says. The 30-second spot ends with her in the vehicle, but says nothing substantive about how Chevy benefits her (or the African American) lifestyle. SIDEBAR: No, You Didn't! Some advertising campaigns seem like the best idea ever -- until the complaints start rolling in. And yet some of the response still remains a matter of perception. The following three campaigns received mixed reviews. You can judge for yourself. 1) NaCo When Abercrombie & Fitch began hawking T-shirts featuring Chinese caricatures and the slogan "Wong Brothers Laundry Service: Two Wongs Can Make It White," the backlash was immediate. Why, then, was clothing company NaCo so successful a few years later with T-shirts brandishing slogans such as "Brown is the New White" and "G is for Greencard"? Those were seen as humorously ironic instead of offensive because they were created from within: They weren't a result of White America's "creativity," but of Mexico-based NaCo's efforts to target Mexican consumers; the T-shirts "started as gifts from friends to bring back the nostalgia of what it meant to be from Mexico," explains Valerie Romley, chief research officer at Moving Target Research Group. Anticipating widespread popularity in America, NaCo ventured across the border, heading straight for Macy's last July. The response wasn't what NaCo had hoped for. "America being as [politically correct] as it is today, pretty soon [Macy's] was threatened with anti-immigration statements and boycotts," Romley says. Accused of not understanding Hispanic consumers or culture, Macy's soon pulled the shirts and made a public apology. NaCo also apologized, for not realizing how "sensitive" the U.S. market was, and released a statement hoping consumers would "understand that we're all about embracing negative stereotypes, so as to help put everyone on an even playing field." 2) i-am-asian.com McDonald's, a truly global brand, has created several minority-specific Web sites in the U.S.: MeEncanta (Hispanics), 365Black (African Americans), and i-am-asian (Asians). But homogeneity, a problem within any minority, is especially apparent in Asians: There's East Asian, Southeast Asian, Asian Indian -- and, within each of those, divisions of national, regional, and linguistic nature. No company has the budget to create a site for every subsegment; but to assume that all Asian Americans literally fit into a single room -- even a virtual one -- risks a serious backlash. "It's a really harmless room," says Cecil Apostol, co-chair of the Asian American Student Collective and the Filipino Student Organization. "It's not like they're saying 'Ching Chang Chong.'" But then there's the sign for bubble tea, paper cranes in the corner, and a random T-shirt that reads, "I aim to be the best," not-so-subtly drawing on the stereotype of academic perseverance. According to Asian American ad firm IW Group, which developed the campaign, every element of the room was selected based on research, and the intent was to help young Asian Americans "recognize that this brand is a brand that understands you." With more than 11 million hits, the site has reached a higher percentage of its target audience than either the MeEncanta or 365Black sites. 3) McDonald's Cha Cha Slide Featuring an African American boy dancing to DJ Casper's Cha Cha Slide while eating a Happy Meal, this ad ranks as the favorite McDonald's commercial on Google's YouTube.com. While the ad may have "cute" appeal, not everyone sees it that way. Ron Campbell, president of strategic research and consulting company Campbell-Communications, argues there's a fine line between cultural cues and stereotyping. "The [song] is universal, but not likely to fit the hip-hop image of the young kid," he says. "He's too young for that 'in-the-'hood' look." That style choice pushes the campaign into stereotyping, Campbell says: "It still would have worked if he was not a caricature of a hip-hop teenager." This ad contributes to (and plays on) the link between African Americans and hip-hop culture, and, given the controversy over hip-hop lyrics, risks perpetuating an image that is not universal to the overall group. Contact Editorial Assistant Jessica Tsai at jtsai@destinationCRM.com.
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