Asian Market Holds Wealth for Financial DMers
Along with these changes in tactics, a change in targets has come about. In only the last few years, American companies have realized that they are missing out on tremendous financial opportunities by focusing their marketing and sales efforts solely on white America. After all, the United States multicultural market is the seventh largest economy in the world with a market value of $885 billion. But many professionals still do not realize the potential.
I remember a conversation with a fellow marketing executive a couple of years ago, during which he predicted that ethnic marketing would be a short-lived exercise. He referenced immigration trends in the 1930s and cited that because of the influx of Italian people, the circulation of Italian-language newspapers rivaled that of the New York Times. Today, some 60 years later, this ethnic group has, for the most part, assimilated into the American culture and only a small, dwindling few still use their native language.
The same can be said of the Greek-American and Eastern European-American populations. While the culture is still very much a part of the lives of people from within those populations, the groups themselves are no longer considered a market in the sales sense of the word. As such, this marketing colleague felt that the time invested in developing communications strategies and brand positioning had been wasted. The notion of creating and enhancing the lifetime value of a brand (the ultimate goal of any marketer) within these ethnic groups was gone because of assimilation.
It was clear to me that it would be quite difficult to make him a believer in the value of Asian-American marketing initiatives. I offered statistics on San Francisco (almost a third of the population is Asian), Vancouver, Canada (half the population is Asian), and New York (at 762,000 Asian and doubling every 10 years). What is most important though about this segment of internationally born Americans is that immigration continues to grow, and with 1 billion people in China the sheer size of the market makes it impossible to ignore. Also, as Asian Americans express a greater identification with people of a similar background than average Americans, they have resisted assimilation more than any other ethnic market, thus remaining a strong market.
So this particular ethnic market has remained intact. What is the value of this group as a customer base?
Asians have the highest household income (over $49K -- more than 20 percent higher than the average household) of the total U.S. population, and the culture looks to the future, which means they are serious savers. (Less than 5 percent of Asians are not saving vs. over 20 percent of the total U.S. population.)
Companies such as mettle, Citibank, American Express and MoneyGram have taken a prominent role in in-language and in-culture communication. Each company identifies the strengths and particulars of the market and positions their products and services to appeal to the appropriate group.
American Express works with Chinese and Korean small business owners and promotes acceptance of the card with a $50 dollar gift certificate via in-language direct mail and telemarketing.
MetLife sees its opportunity in these markets by attracting new customers through advertising, and more importantly, community involvement.
Citibank, in conjunction with a branch opening in New York City's Chinatown, ran a promotion targeting the Chinese market by offering jewelry with cultural significance to customers who opened new accounts within a certain dollar range.
The Fannie Mae Foundation realized the complexity of buying a home and offers in-language guides steering people through the process. From 1993 to 1996 Asian-American home ownership has grown by 11 percent compared to only a 4.5 percent growth in Caucasians.
While the opportunities are significant, a company that runs an advertisement using Asian themes during the lunar New Year and pats itself on the back for being a multicultural marketer is sadly mistaken. Campaigns must be in-language and, more importantly, in-culture. Therefore, in addition to account executives, marketers need to develop market managers who are aware of the importance of various colors, symbols and icons. Managers who know the significance of certain festivals, and when they fall during the year. And those who understand the way of life, the way of thinking and the cultural underpinnings of purchase decisions. Anything less falls short.
While it does not take a financial commitment the size of traditional, mass-market communications campaigns to reach Asian Americans, the return on the investment is great ,and the loyalty is unwavering. What will it take for corporate America to realize the potential? Census 2000 will be an eye- opener.
Atsuko Watanabe is executive vice president and general manager at Admerasia, New York, a full-service ad agency specializing in reaching Asian markets.