Archive for the ‘African American Segmentation’ Category

President Obama is Not the Only Wealthy African American on the Green.

Friday, June 5th, 2009

With spring moving into summer for most of the country, the opportunity to blow off some steam or make a deal outside the boardroom with a golf club is beckoning. And, marketers who are looking for more “green” should be looking on “the green.”

Prominent figures giving credence to this idea are, of course, President Obama and Tiger Woods. club-swing1The Associated Press reported this week that the President has had four golf outings in the last five weeks. During Black History Month earlier this year, the PGA of America presented a display at the PGA Historical Center honoring four groundbreaking African-American heroes in the sport. The presence of African Americans in the game is noteworthy.

A Profitable Niche Segment for Golf Industry and Luxury Brands
Statistically, the African-American golf community has grown by thirty per cent in the last decade with interest in the game rapidly outpacing that of Asian American and Hispanic Americans. In fact, the National Golf Foundation reports that a full fifteen per cent of golfers – a stunning 5.5 million people – are minorities, and 2.3 million of them are African American.

Since participation is a function of household income, it stands to reason that gaining the attention of this niche segment of golf enthusiasts will help brands more effectively implement their target marketing strategy of reaching the affluent ethnic consumer – especially, the African-American RoyaltonsTM. Adding 2.3 million people to a list of potential consumers is any marketer’s dream come true.

Participants With Purchasing Power
Based on minority participation reports conducted by the World Golf Foundation and their Golf 20/20 initiative, the industry has been targeting minority groups who are viewed as important to growing interest and participation in the game. African Americans, along with women and Hispanics, are the demographics “with pent up demand” who will help the sport meet its target of having 55 million participants by the year 2020. If Year 2000 census data showed the golf industry having $62 billion in sales – more than the motion picture and sound recording industry and the amusement, gambling and recreation industry – then the currently growing participation of affluent African-American players offers significant purchasing power to be harnessed. That purchasing power has been estimated to become nearly half (45%) of the projected $1.1 trillion of all African Americans by 2012.

With the proportion of African-American female golf participants found to be above average, another potentially fruitful sub-segment is appearing. Many professional black women are taking to the golf course to capture that lucrative business deal often negotiated on the green. In the Spring 2009 issue of Odyssey Couleur, Pam Swensen, CEO of the Florida-based Executive Women’s Golf Association, stated that she is seeing an increase in membership as more African-American women use golf as a business-building tool.

All any luxury marketing executive has to do to potentially gain new prospects is to let go of some assumptions about who the “typical” golfer was in the past and choose to step into the future of the golf market.

Are you a brand marketer or golf industry related business wondering where and how to reach this audience?

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IS THERE A VALID BUSINESS CASE FOR DIVERSITY MARKETING IN AN ECONOMIC RECESSION?

Thursday, May 28th, 2009

Emphatically, I say, “YES!”

I’m sure you’ve heard the American proverb, “He who has the gold makes the rules!”

As we near the end of the second quarter of 2009, marketers would be wise to follow this bit of astute wisdom as they assess their remaining advertising budgets.

Of course, first you’ll need to discover the gold-holding rule-makers: I will tell you they are the affluent ethnic consumers.

Being the savvy marketer that I’m sure you are, it’s likely you’ve read the articles identifying ethnic consumers as viable new prospects. What I’m not seeing much information disseminated about is the affluent segment – not the middle class – but the truly affluent sub-segments within this consumer group. They are a largely ignored and under-served market segment who are patiently awaiting the right marketing approach from you.

The key to your approach is to never make the mistake of marketing to affluent ethnic consumers from your perspective and asking them to come to you. This sub-segment has made their own rules, and they are highly influential in today’s marketplace. Deliberately cater to them by getting on their turf, seeing through their eyes, and speaking their language. You must go to them, and serve them on their terms, in order to build lasting and meaningful relationships. I’m sure their $282 billion in purchasing power is something you want to harness.

Here are a few tips for luxury marketers, or any marketer, to plan a successful target marketing strategy:

• Identify and utilize appropriate ethnicity-based traditional and non-traditional media outlets in your advertising.
• Partner up with membership-based ethnic organizations.
• Consider instituting a Diversity Advisory Board in your company.
• Hire a more diverse workforce.

Now is not the time to cut back marketing expenditures; instead, correctly divert them toward this sub-segment, and I guarantee you will see better ROI in the way of stronger loyalty, broader word-of-mouth, and fresh revenue streams in addition to your general market initiatives.

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DMNews: Marketers look closer at black consumers and find segmentation opportunities within

Monday, April 6th, 2009

President Obama is making his mark with large spending bills and a unique approach to leadership, but he’s also creating subtler effects in the world of marketing by bring­ing African-Americans into the spotlight as a consumer segment. Lexus, for example, has started targeting black women with ads for its luxury hybrids, and Amtrak recently launched an Acela Express campaign aimed at blacks and Latinos.

“Since the election of President Obama, there is more curiosity about the African American consumer and their behavior on behalf of marketers,” says Esther Franklin, EVP, director of cultural identities for Star­com MediaVest Group (SMG)’s multicul­tural unit, SMG Multicultural.

“The whole Obama phenomenon should make it easier for marketers to embrace multicultural and diversity in advertising,” adds Sonya Grier, associate professor of marketing at American University.

Of course, Obama can’t be held solely responsible for this renewed interest in marketing specifically to black consum­ers. The tight economy — which is driving marketers to target more tightly — combined with improvements in the data and analyt­ics space also may be playing a role in this increased focus on a particular segment of the population.

“It is part of the trend towards segmented targeted marketing to all identifiable con­sumer groups,” explains Sid Liebenson, EVP, director of marketing, Draftfcb. “The Afri­can-American market is not a small or insig­nificant market in most product categories, so it behooves marketers to understand the marketplace better and look at more relevant ways to connect with the community.”

Even with more data coming in, getting to know African-Americans as a consumer group is a difficult process. The group, which makes up approximately 14% of the US population, is certainly not homogenous. To reach diverse groups within the community, marketers need to research carefully.

“One of the biggest things is to under­stand the consumer and make sure that the value proposition is relevant,” Grier points out. “Marketers may use stereotypes based on what they believe these consumers want, but it’s not a monolithic market. Segmenting within the group may prove to be more suc­cessful. Hip hop [might appeal to] a certain age group or psychographic group, but it’s not all African-Americans.”

In-depth segmentation of African-Ameri­cans is sprouting up, like with SMG’s Beyond Demographics initiative. Launched in 2007, Beyond Demographics has done extensive research into the black population, segment­ing the group into 12 psychographic divisions with names like “buppies,” “nomads” and “activists.” Lattimer Communications, too, has created six psychographic profiles for black women, including “achievers,” “tra­ditionals” and “cynics.”

However, Lattimer also released a study in February revealing that 86% of African-American women still feel that advertisers do not know how to speak to them.

“A majority of blacks fall within the middle class, and we often forget them, and they often feel that advertisers are not talking to them,” says Leylha Ahuile, senior multicultural expert for research company Mintel. “Targeting advertising to blacks is not about using black people in your ad, it’s about the cultural understanding. What is the message or trigger point?”

As African-American and other minority populations grow, it is essential for mar­keters to understand these cultural trigger points and build relationships with diverse consumer groups. Ahuile says that in 2050 about half the US population will be “mul­ticultural,” and the buying power of African American consumers is projected to reach $1.2 trillion by the year 2012.

“There’s a lot more understanding that needs to happen,” Franklin said. “The power of the African American consumer dollar is only growing, and we all know our country is growing more multicultural as we speak. Multicultural influences have huge impacts on society in general, and for that reason it’s important for advertisers to have a more complete understanding of what the implications are for their brands and services.”

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