Is Cross-Cultural an Industry Breakthrough or Threat to Ethnic Shops?

While Some Praise Concept of a Unified Message, Others Argue General-Market Agencies Are Using it to Move in on Others' Turf

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Ken Muench
Ken Muench

NEW YORK ( -- One of the latest buzz words to enter the marketing lexicon is "cross-cultural." It paints an idealistic picture of a color-blind society, one in which consumers' similarities outweigh their differences regardless of ethnic groups. Whereas multicultural means multiple executions -- often from multiple shops -- wouldn't it be simpler to find one truth that reaches across culture?

It's a valid question, but critics at multicultural agencies and ethnic shops are quick to point out that the question -- and the concept -- seems to be coming from general-market agencies moving into their territory.

This past year there were two significant account shifts that involved ethnic shops losing portions of accounts to general-market agencies. Home Depot moved its $37 million U.S. Hispanic account to Richards/Lerma, a unit created by Home Depot's general-market shop Richards Group, from incumbent Vidal Partnership. And Burger King shifted its Hispanic and African-American accounts from LatinWorks and Uniworld Group, respectively, to its general-market partner CP&B.

WPP Group has created OgilvyCulture, a new "cross-cultural strategic-service practice." Last year, DraftFCB's Ken Muench, senior VP-director of multicultural strategic planning, penned a "Cross-Cultural Manifesto" for Ad Age.

Pepper Miller, president of the Hunter-Miller Group, an African-American-focused market and research consulting firm, said cross-cultural as a concept is not entirely wrong, but general-market agencies are using it as an opportunity to move into space occupied by multicultural shops.

"The people who are focused on ethnic segments are left out of the translation of this code as well as the opportunity to compete for mainstream business," she said. "Cross-cultural is not getting us to the place of understanding the differences between these cultures. It still stands for one message to reach all people and then cultural insights are getting lost."

Unsurprisingly, proponents of cross-cultural marketing at general-market agencies say it's a completely different topic from ethnic marketing -- and that ethnic shops won't necessarily get cut out from the system. Mr. Muench, who joined DraftFCB from Grupo Gallegos, said all general-market campaigns should be created from a multicultural perspective. The demographics of the U.S. simply demand it. Once the creative for general-market effort is completed, the Hispanic and African-American creative is then executed.

Most "general-market agencies create advertising from a white, middle-class perspective and that is less relevant today than it ever was in the past," Mr. Muench said. "Creating general-market campaigns from a multicultural perspective doesn't mean we don't do Hispanic or African-American advertising on top of it. It means we have to create elements within that campaign that precisely target those other consumers."

Multicultural viewpoints "need to be part of the people and need to be part of the mainstream," Mr. Muench said. "Cross-cultural marketing is about creating better general-market advertising."

As hard of a time that ethnic shops might have believing that line of thinking, some of Mr. Muench's clients are also skeptical. "Clients have to buy into it, and frankly not all clients do," he said. "A lot of clients see the light and see their consumer base has changed and want to start tapping into this."

Alejandro Ruelas, managing partner at LatinWorks, said this is just a different version of the same game that's been going on for years. "General-market agencies are seeing an opportunity for revenue and revenue growth in this space and trying to get in and play, whether it be through acquiring a multicultural shop or creating a dedicated unit within the agency," Mr. Ruelas said.

In the case of Burger King, Mr. Ruelas again said the situation was one his agency has dealt with in the past. He said certain general-market agencies that have good relationships with clients will tend to get opportunistic and say they can deliver the Hispanic market. "They promise a more unified message and dangle the carrot of efficiencies in front of them," Mr. Ruelas said. "Certain clients are going to go with that seductive offer and others, those more embedded in the Hispanic marketplace, will see those agencies are not set up to deliver the marketplace the way agencies like ours can."

Mr. Ruelas said he will be watching to see what Crispin does with Burger King's Hispanic business. "If a general-market agency can put a model in place and deliver against a target that we claim is our territory, then we need to come away with a lesson learned from that."

Pete Lerma, head of Richards/Lerma, said Richards/Lerma started on the basis that the agency could create an operation that would allow its clients' marketing to more accurately reflect the evolving U.S. culture. Richards/Lerma is the Hispanic AOR for Metro PCS, Advanced Auto Parts and Chrysler's Ram trucks among others.

Mr. Lerma said cross-cultural doesn't signify the extinction for ethnic shops. In fact, he said traditional multicultural agencies should view "this evolution in the market" as an opportunity to work alongside their general-market counterparts and "positively influence" brands.

"We are providing insights, from Hispanic perspective and concepting creative work and ideas that connect brands and people," Mr. Lerma said. "Those ideas supersede language and culture. The greatest common denominators between these brands and customers are what we are finding. And it seems to me that the traditional multicultural agency should see that as a huge opportunity. We can influence the general-market work in a way that makes it a greater reflection of the more multicultural society we live in."

That line of thought was on display from marketers at the Association of National Advertisers' Multicultural Marketing & Diversity Conference in November. Pam El, VP-marketing at State Farm, the country's largest auto insurer said that business is the bottom line and that marketers want help -- rather than agency infighting -- from various sources. "I need to know that Agency X has my back and they can't have my back if they are at it with each other," she said, adding "There is enough business for everybody," so "do your part, bring your best stuff to the table and it will work out for you."

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