Multicultural Strategy: The Future is Now

Erin Liber
Marketing Insights
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Key Takeaways
  • In essence, technology has allowed for companies and brands to “know” and market to consumers at an unprecedented level of personalization.

  • There is no typical or average multicultural shopper.

  • Transforming insights into action that let us create meaningful relationships with multicultural consumers will be a differentiator for success in the years ahead.

Amazon can craft an entire list of books, movies and music based on my purchases and browsing, and then either deliver them to various devices or accommodate the increasingly antiquated idea of tangible entertainment consumption through next-day delivery (soon to be drone-enabled). Starbucks knows when I am within a certain distance of one of their locations and pings my smartphone with a reminder that I may be thirsty or interested in their new flavored beverage. 

In essence, technology has allowed for companies and brands to “know” and market to consumers at an unprecedented level of personalization. Yet while the speed of change has been quick across so many facets of the marketing world, we continue to lag behind when it comes to understanding and creating relevant, insights-driven connections with multicultural consumers. Much has been written about the impending population shifts and how that translates to buying power, but few are ready with the insight and strategy to capitalize and fundamentally shift existing mindsets. According to our research at 84.51° Asians, African-Americans and Hispanics will contribute nearly 90% of population growth between 2014 and 2019. By 2040, the non-Hispanic Caucasian population will drop below 50%, becoming the minority. The three largest ethnic groups in the U.S. will each be over 125 million. 

The future is now for the multicultural shopper. Without a fundamental shift in how we think about marketing—from the products on the shelf to the way we communicate with consumers about these products—brands will likely be left behind. This fundamental change requires looking well beyond demographics. 

In addition, there is no typical or average multicultural shopper. The purchase behavior of these consumers is influenced by so many facets beyond their ethnic or demographic classification. This can be seen across nearly every category, including what Hispanic, Asian and African-American consumers are placing in their carts at their local grocery store. Here are a few insights into these customer groups, according to our research:

  • Asian consumers: frequent and fresh. The buying power of Asian consumers is significant and growing at the fastest rate of any consumer segment within the U.S. Asian households have different shopping patterns in totality. They have smaller grocery baskets but visit the store more frequently, and those trips add up. They are also engaged in fresher, more perishable items, with 20% higher spend in produce and 50% higher spend in natural foods.
  • African-American consumers: convenience is key. Previous perceptions of convenient categories are evolving. Frozen food relevance has met a steep decline with African-American millennials. For example, within the frozen, single-serve premium meal space, engagement with African-American millennials has declined nearly three times as much compared to the rest of the population. 
  • Hispanic consumers: personalized strategy. Having a single Hispanic strategy just won’t work. Whether looking at generational status or acculturation level, the needs and corresponding shopping patterns are fundamentally different. For example, more acculturated Hispanic shoppers are engaged in center-store offerings at nearly a rate of 1.5 times that of less acculturated consumers. Variety-seeking behavior also varies drastically across the acculturation spectrum.

With all of these nuances, a blanket multicultural strategy is no longer sufficient in today’s world. Whether that entails using any of the above insights to guide new product innovation, assortment decisions at shelf, promotional strategies, or personalized media efforts, marketers today need to change their thinking to a more personalized strategy versus a one-size-fits-all strategy. Isolating similarities, differences, emerging needs, and shifts in behavior enable retailers and brands to tailor strategies, personalize communications and ensure relevance across their portfolios. 

The insights exist, but we need to value these insights enough to do things differently. As the wise marketers at NBC once said, and then subsequently animated, “Knowing is only half the battle.” Transforming insights into action that let us create meaningful relationships with multicultural consumers will be a differentiator for success in the years ahead. The future is now.


This article was originally published in the Ju​​​ly 2015 issue of the Marketing Insights​ e-newsletter.


Author Bio:

 
Erin Liber
Erin Liber is director of customer science at Cincinnati-based marketing agency 84.51° (formerly DunnhumbyUSA).
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