MULTICULTURAL: TREND SPOTTING: WHERE THE ETHNIC MARKET IS HEADING

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Several marketing trends, including the emergence of ethnicity as a driver, will accelerate the demassification of the American marketplace. Here are trends tracked by Market Segment Research:

LIVING THE AMERICAN DREAM

The American Dream Index is used to describe the emergence of a strong ethnic middle class. The Index is a composite of four factors, which are the driving components of the commonly held notion of the American dream of home ownership, small-business ownership, education and household income. Over the last 10 years, ethnic Americans have been capturing the American dream more than 3 times faster than non-ethnic Americans.

DIVERSITY WITHIN DIVERSITY

As a product progresses along its life cycle from introduction to growth, it becomes necessary for marketers to artificially slow progression into the maturity and decline stages. In the future, many ethnic marketers will segment around any number of schemes, including country of origin, language, acculturation, age, needs, usage and loyalty. The trend in the future will be to think nationally but act locally, tailoring your strategy for specific needs.

STRONG CULTURAL TIES

Ethnic consumers continue to progress along the acculturation continuum toward retention of culture. Today, only 16% of Hispanic Americans, for example, claim to have weak retention of cultural ties, with 84% pointing to strong or moderate retention of culture. There will be an acceleration in the shift from in-language to in-culture marketing and advertising, utilizing a fully integrated approach.

POLITICAL ISSUES IMPACT

The confluence of a number of social, political and economic factors will lead to a merging of marketing and politics in 2000 and beyond. As the pace of formal immigration slows, economic pressure abroad will nevertheless continue to stimulate the desire to emigrate to the U.S. At the same time, a recent wave of anti-immigrant sentiment has spawned legislative action like California's Proposition 187 and Proposition 209.

IMPROVED MARKETING SUPPORT

The marketplace will undergo a significant shift in the coming years. The quality, quantity and level of sophistication of the infrastructure serving companies that target ethnic consumers will rise to new heights. The quality of work is already comparable to the general market.

EARNING A 'LICENSE TO MARKET'

As ethnic marketing is elevated, companies will increasingly recognize the need to earn a "license to market." Marketers will learn that philanthropic sensitivity and visibility in ethnic communities, internal employee diversity, empowered employee affinity groups and effective minority purchasing programs are critical elements in their efforts.

PROLIFERATION OF ETHNIC MEDIA

Since 1993, ethnic TV has accounted for 10% of all new cable networks. Not only are we seeing an expansion of Spanish-language media, but also of programming geared toward the less saturated ethnic markets, including The Filipino Channel, Native American Nations, Celtic Vision and World African Networks. In addition to broadcast media, we will see the increasing viability of ethnic direct-marketing programs.

SPECIFIC PRODUCTS

Increasingly, products are being developed based upon the unique value propositions of ethnic consumers, rather than existing products being marketed to ethnic consumers based upon purchase motivators. In recent years, many products and services have been developed specifically for the ethnic consumer, such as in telecommunications (targeted optional calling plans and prepaid calling cards) and greeting cards (e.g., Hallmark's Primor and Mahogany lines), cosmetics (Zhan and Shiseido) and postal products (Black Heritage and Native American series stamps, Dinero Seguro wire transfer).

Mr. Berman is president of Market Segment Research & Consulting. The American Dream Index was developed jointly by MSR&C, Graham Gregory Bozell and Demograph

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