The Challenges of Ethnic Marketing

It is now generally accepted that immigration is essential to the stability of the work force in the coming years. Certainly to off-set the now greying ‘baby-boom’ generation and the (near) negative population growth rates being recorded in some countries.

Unique marketing campaigns

While ethnic marketing had its roots in the USA during the 1980’s, its principles are applicable and valid in the European context where population shifts have created cultural diversity in all major cities.

More increasingly, companies are creating special marketing units to focus specifically on these ethnic groups. By so doing, their core requirements can be comprehensively addressed by creating unique marketing campaigns to which they may better relate.

Changing demographic patterns and segments

Euroland is now fact and with the advent of SEPA on the near horizon, the concept of a true pan-European trading village is becoming reality.

The real challenges of expanding traditional domestic markets beyond current limits, throughout the wider Europe (and beyond) to secure new customer bases, lie in a clear understanding of the changing demographic patterns and segments.

Obviously the key marketing indices remain critical in this equation (understanding product, competitive pricing, distribution channels, place and brand/branding). However, social and ethnic marketing are clearly pivotal indexes to be included in determining a new marketing mix proposition and customer-centric sales paradigm.

These new dynamics of ethnic marketing are applicable to all economic segments (finance, retail, services, IT, telecommunication, manufacturing and agriculture).

Shifting ethnic segments

The myth of the poor immigrant has been largely dispelled as an overt misconception. As immigrant populations integrate within the mainstream and their disposal income rise, these ethnic pools begin to have wider choice.

Better education opportunities means that these pools are literate, can differentiate and make informed choices amid the wide array of competing brands, products and services. Ethnic integration within the mainstream does not mean fully embracing new cultures.

On the contrary, these shifting ethnic segments hang-on closely to their cultural root and identity including language and religion. This socio-cultural dichotomy has made the marketing game interesting and certainly challenging to the savvy marketer.

Progressive marketing organizations are realizing that being able to effectively tailor products and services directly to the individual is the key to successful customer loyalty.

Labels for this are diverse but the most common one now used is one-to-one marketing where strategic marketing communication is tailored specific to a customer’s mosaic.

Realistic ethnic and cultural content

The challenges of ethnic marketing is to segment these groups and use language, culture, religion and geography as decisive filters. Customer intelligence and market research have enabled companies to better understand the target consumer.

This understanding is clearly advanced by evolution in IT and data mining programs. Consequently, market communication and advertisement have become very specific in highlighting product, service and brand premise in a realistic ethnic and cultural content.

Ethnically diverse European markets are clearly evident in cities such as London, Paris, Amsterdam, Brussels, Berlin, Rome, Madrid, Zurich, Lisbon and Munich.

Reliable and efficient transportation means that authentic and fresh produce are now widely available. Speciality retailers are usually very visible in ethnic neighbourhoods in cityscapes.

Cultural specifics in developing products and services

Financial service products are being developed along ethnic, religious and cultural norms. International banks have started to include cultural specifics in developing products and services (example banking services to Islamic segments).

Banks’ efforts to serve immigrant and minorities is being applauded, mostly by the immigrant groups that have long complained of banks’ inattention to customers outside the mainstream.

While it is literally impossible to quantify a consolidated value of pan-European ethnic market pools, a conservative projected value easily exceeds €100 billion per annum.

These new approaches to ethnic marketing, directly impacts and correlates to most industries:

• Food & Drink: Restaurants and speciality markets
• Travel & Entertainment: Tourism, leisure, cinema and theatre
• Education: Schools
• Finance: Banks and financial services
• Retail: Wholesale markets and speciality stores
• Mass Communication: All media and advertisement
• Transportation: Travel agencies, logistics and distribution
• Public Services: All
• Telecommunication: All

Key ‘ethnic pools’ in Western Europe:

• Asian: Chinese, Japanese, Thai, Korean, Vietnamese, Indian, Pakistani, Bangladeshi and Pilipino.
• European: Italian, Turk, Greek, Spanish, Dutch, French, Portuguese, Polish, Russian, Bosnian, Czech, Slovakian and Romanian.
• African: Moroccan, Egyptian, Nigerian, South African and Francophone African, Tunisian and Ethiopian.
• Latin American: Mexican, Brazilian, Argentinean, Peruvian and Caribbean.
• Middle Eastern: Lebanese, Syrian, Jordanian and Iranian.
• Religion: Islam, Hindi, Judaism and Buddhism.

Our conclusion is that immigrant pools have the same desires, needs and ambitions as the general population.

With the ever increasing spending power, companies and marketers must reassess the changing segment dynamics to capture the potential of these identified ethnic groups.