Marketers are well aware that the 'average American consumer' no longer exists in its original form. Instead, today's shoppers represent an array of ethnicities, cultures, and lifestyles that exhibit varied preferences and behaviors. Nonetheless, as the CMO Council's recent "Activating the New American Mainstream" report emphasizes, many companies have yet to develop the essential strategies necessary to establish multicultural marketing initiatives.
Conducted in partnership with Geoscape, the study surveyed 150 senior marketing leaders across both B2B and B2C organizations to assess how marketers are currently leveraging their assets and abilities to address increasingly important minority customer segments.
Overall, Hispanics, Asian-Americans, and African-Americans constitute more than one-third of the current American population, transforming these supposed 'specialty' segments into the new American mainstream. These demographic groups possess vast buying power and influence, while creating thorny challenges for marketers that are struggling to reach and engage these customers via targeted content that appeals to their particular culture.
The following research findings demonstrate how multicultural marketing initiatives fit into the current consumer landscape and what companies must do to keep pace with customer experience expectations:
- Fifty-one percent of marketers claim that their company currently has multicultural marketing initiatives in place. Yet, while 80 percent of B2B companies don't have such initiatives in place, 67 percent of hybrid (B2B and B2C) organizations do have multicultural strategies in place.
- Companies without multicultural marketing initiatives in place say that these programs aren't a priority for their organizations (36 percent), while others report insufficient budgets (34 percent) and strategies that were believed to address these segments through total-market efforts (26 percent).
- Marketers that do have multicultural initiatives in place say their programs are strategic (36 percent) and that they are mission critical for their organization (27 percent). Yet many are continuing to refine their efforts, describing their programs as experimental (32 percent).
- Fifty-five percent of marketers feel they lack buy-in on multicultural marketing initiatives from the CEO, while 60 percent lack support from their board of directors. However, marketing leadership appears to provide to greatest amount of support, as respondents feel they have buy-in from the CMO (66 percent) while 70 percent believe they have the backing of brand management.
- Overall, 54 percent of marketers indicate that total budget allocation for multicultural efforts ranges from 0-10 percent of overall marketing budgets, as organizations determine spend based on what's required to reach the company's goals for growth (53 percent), ROI (49 percent), and the total number of multicultural consumers who are considered to be a fit for their products or services (48 percent).
- When it comes to deploying these multicultural marketing initiatives, most take the total market approach (54 percent), where all cultures are integrated with pooled resources. Conversely, 17 percent operate under one multicultural initiative that combines Asian-American, and African-American consumers with separate resources but one strategy, while 9 percent separate marketing initiatives for Hispanic, Asian-American, and African-American consumers with separate resources and dedicated strategies for each.
- Marketers indicate that multicultural marketing efforts will increase in importance, as 16 percent of those surveyed expect significant increases and 37 percent believe importance will increase "somewhat." Similarly, 84 percent of marketers who engage individual segments with individual strategies expect budgets to grow, as do those who aren't currently engaging individually but anticipate an increased budget (71 percent).
Key takeaway: While marketers clearly understand the importance of their multicultural efforts, teams will continue to falter without C-level support and commitment across the entire business. Fifty-one percent of respondents feel their company has too many competing priorities, while 38 percent reported that not everyone in the company was onboard. Only 20 percent declared that commitment to such efforts was mandatory and unanimous throughout the organization. Unfortunately, this perpetual lack of alignment will inevitably hurt the brand if it persists. Without buy-in from executive leadership, marketers will have no choice by to rely on the individual campaigns and translations that fail to create the connected experiences that resonate and engage multicultural consumers. Providing the right content in the right language at the right time remains crucial, but these initiatives also enable brands to deliver localized, personalized content that reflects who these consumers are and what makes them unique. With C-level commitment and support, marketers will be able to secure the budgets and intelligence necessary to develop engagement and strengthen long-term loyalty.