GROWING DIVERSITY Marketing to a Diverse Customer Base By Gail Cox AC&M Group This article was written in honor of Vince Cullers, founder in 1956 of what is considered to be the first ethnic marketing agency in the United States, the Vince Cullers Group. n 1956, the first ethnic marketing advertising agency, the Vince Cullers Group, was born. The agency was created out of a need for marketing that engaged ethnic customers Iand presented them in a positive light in national advertising. At that time, African Americans and Hispanics were less than 10% and 3% of the population, re- spectively. Efforts and resources invested in reach- ing these ethnic minorities were minuscule. Vince Cullers However, there were great market- growth in other ethnic and mixed-race multicultural consumers speak English. ers like McDonald’s, Coca-Cola, Bristol populations, ethnic populations today Consider, however, whether or not Myers and BP Amoco that recognized comprise about 40% of customers. But you would recommend marketing to the value of ethnic customers and that spending against all multicultural seg- women the same way that you market recognized that reaching them with rel- ments still amounts to significantly less to men, even if both campaigns were evant and engaging messaging required than 10% of all advertising spending. done in English. the expertise of professionals steeped in Sadly, most of the efforts in multi- Whether or not you would market to those cultures and experienced in that cultural marketing remain “plug and people in their 20s the same way you work. This gave birth to a much-needed play” efforts: Scripts totally lacking in market to people in their 60s. specialty in the marketing space: Multi- cultural relevance and a random mix of Whether or not you would market to cultural Marketing. faces of color are placed into advertis- low-income customers the same as to Unfortunately, the adoption of best- ing; materials are conceived by general wealthy customers. practices for actively courting multi- population agencies clearly lacking in It is important to understand that cultural consumers has been very slow. any diverse talent and any depth of ex- when companies market to multicul- Efforts have been plagued by limited perience in reaching multicultural au- tural audiences, there is an opportunity budgets and inauthentic and ineffec- diences. not only to reach and optimally engage tive attempts that scratched the surface them as consumers, but also to engage instead of being well-funded and care- DOES MULTICULTURAL them as employees who are a part of fully considered strategic actions. MARKETING MATTER? the process and to do so while support- Fast forward a few decades, and Some might ask if the disproportionate ing minority-owned agencies, minority with a surge of immigrants during the diversity investment vs. diversity repre- talent and minority-owned media ... in 1990s and early 2000s along with the sentation matters, especially when most essence, to support these diverse seg- 18 ACUMA PIPELINE - WINTER 2021 ments as engines in the overall econo- my. Ultimately, this participation benefits all Americans and the overall growth in our economy. While some people may postulate that participation in the economy by the ethnic population is neither criti- cal nor necessarily a high priority, it is important to note that without the ac- tive participation of most members of the U.S. population, our economy will suffer. MORE WHite deatHS PER YEAR THAN WHite BIRTHS, Furthermore, to put it bluntly, the contriButing to WHite POPulation DECLINE non-Hispanic White population in the US is declining, and most of the growth White Births and Deaths fueling all facets of our economy will Size and Race Make-up of Populations Under Age 18 and Age 65+ be driven by multicultural populations who are quickly becoming the emerging 2.3M majority in many parts of our country, and eventually in our country overall. (See chart top left.) 2.2M This trend is now accelerating, in part, due to Covid-19. Not only is the DEATHS White population declining, but White 2.1M BIRTHS spending in key categories is also de- clining. In fact, in the past two decades, 2M 90% of the growth in the population and resulting growth in key categories occurred primarily because of multi- 1.9M cultural customers. 2006 2008 2010 2012 2014 2016 Multicultural customers drove new household formations, home mort- Source: Pew Research Center, Census Bureau gages, car sales, consumable-goods cat- egories and entrepreneurial start-ups. Additionally, these populations make ETHNIC Minorities ARE EXPected to DRIVE ALL US POPulation GroWTH up the majority of critically important essential-worker occupations including Projected Growth, 2015-2060 nurses and home-care aides, food-pro- 200% 200 cessing workers, construction workers, package sorters and delivery workers. 175 These tangible economic growth 150 contributions don’t even consider the 125 96% 103% important cultural contributions these 100 segments make in setting trends and 75 defining pop culture in everything 50 37% from music, sports, entertainment, fashion and even food. For example, 25 14% -10% most people don’t realize that tortillas 0 have surpassed bread, and salsa has sur- -25 passed ketchup in sales. These items are Whites Blacks American Hispanics Asians 2+ Races Indians and not only being purchased by Hispanics; Alaska Natives they have truly become mainstream. (See chart bottom left.) OLD MINORITIES NEW MINORITIES It is also important to remember that while almost 40% of the population, on ACUMA PIPELINE - WINTER 2021 19 raphers show that the opportunity for WHERE MINORITIES ARE ALREADY THE MAJORITY the U.S. economy to grow increases as we improve the conditions and the op- portunities for all—especially when we are able to impact the economic pros- perity of the specific segments that are already growing the most from a popu- lation perspective. SO YOU WANT TO GROW YOUR CUSTOMER BASE? Given that the average credit union has approximately $250 million in assets and that advertising budgets tend to be less than 0.10% of assets, it is estimated that most credit unions have some- where between $200,000 and 400,000 annually to spend on marketing efforts. With such small budgets, it can be dif- ficult to participate in traditional mar- keting tactics like TV ads, and efforts may be limited to extremely targeted and non-traditional tactics, especially Source: Census Bureau; PEW Reseach Center when attempting to reach multicultural customers as part of the marketing mix. POPulation UNDER 18 MORE ETHNIC / POPulation 65+ MORE WHite Many people tend to think of mul- ticultural marketing only in terms of Children and Seniors, 2010-40 adding a few people of color into the Size and Race Make-up of Populations Under Age 18 and Age 65+ images that carry your brand through Millions media to the end-customer, or in terms 90 of translating a few key messages into 80 different languages. 70 In reality, marketing is so much more than that. Multicultural or Diversity 60 Marketing is about understanding who 50 you have as members and who the up- 40 and-coming populations are that you 30 need to get in order to grow. It is about 20 understanding their needs, their cul- 10 tural cues and their motivations. It re- 0 quires understanding the ways that you 2010 2020 2030 2040 2010 2020 2030 2040 can legally address them, especially in a Under Age 18 Age 65+ regulated environment. Whites Blacks Asians Hispanics Other races It is also about being honest with Source: 2010 U.S. census and Census Bureau projections, released March 2018 Center your organization about whether or not you have properly prepared to serve the customers you have and the new cus- average, is non-White, in some parts of people and White culture are under at- tomers you might want to reach for the country, minorities are already the tack from multiculturalism and non- growth. majority, representing as much as 97% White races. of the population. (See map above.) Their assumption is that the Ameri- WHO ARE YOUR When protesters in Charlottesville can economy is a zero-sum game and MEMBERS TODAY? angrily chanted, “You will not replace that improving the plight of the grow- As you develop marketing plans each us,” their chants were reflective of the ing, non-White populations can only year, it is important to update your knowledge of the aforementioned come at the expense of others. Howev- understanding of your customer base. trends and their fears were that White er, research and data from top demog- In cases where blind customer data is 20 ACUMA PIPELINE - WINTER 2021 available with demo- DOES YOUR ORGANIZATION in their native language, especially for graphic identifiers, REFLECT YOUR DIVERSE MEMBER- more complex and important transac- that data can help you SHIP AND THE DEMOGRAPHICS tions in their lives like banking. Customers“ of to easily identify how OF YOUR SERVICE AREA? In fact, in the United States one in you would demo- five people speak another language at Especially given the heightened under- color now are graphically describe home. standing of racial bias and the impact it even more your customers over- When customers come into your can have on someone’s life, customers inclined to all and to identify any branch, it will go a long way toward of color are even more inclined to scru- patterns or clusters making them feel welcomed, valued scrutinize who is tinize who is working in your branch in the data based on and comfortable if they are able to find working in your lobby, in your drive-through and in things like age, eth- someone who can communicate in your main office.