Multicultural marketing, in the traditional sense of the phrase, is dead. There, we said it. Call it what you like: "Armageddon," a "tipping point," a "paradigm shift." It doesn't matter.
Even with the latest 2010 U.S. Census numbers now on the books and ethnic minorities accounting for the greatest growth sector, marketers continue to underspend with no real breakthrough in sight. Go to any of the few ethnic ad agencies still left and you'll hear, "we are evaluating our options," trying to "secure client budget approval," and so on. As early as the middle of this summer, some agencies were telling traditional media reps that their multicultural ad spending for 2011 was done! In July? Really?
So what killed multicultural marketing? A number of things.
The collapse of "traditional" ethnic segments in light of the emergence of new multicultural identities among consumers -- we are not "Hispanic," we are "Dominican/Ecuadorian" -- was a key factor. The 2010 U.S. Census paints a surprising portrait of an America less amenable to classification because of all the layers they bring to the equation. Americans are simultaneously more and less segmented. Marketers have still not figured out how to engage this changing consumer. There are new realities in consumer behavior and culture. Culture and ethnicity in truth represent only a small piece of the layered puzzle of consumer behavior. What has emerged is a hybrid culture with a bricolage of influences.
The economy, too, played a role. With economic decline comes the unavoidable scaling down in marketing budgets and traditional ad spending. And guess what? Multicultural budgets are often the first to go. When big players like Disney, who insists it is committed to ethnic markets, cut losses by closing En Familia magazine, you begin to see that the traditional approach -- and media -- are under attack.
That brings us to our third cause: the demise of traditional media coupled with the emergence of digital and social-media marketing. With severe cuts in ad spending, smaller ethnic newspapers, magazines and broadcast properties are in trouble. Even in the large and mostly successful Hispanic segment, some tried-and-true titles ceased publishing print editions, became digital editions, or just closed shop. If you can survive without revenue from major retail, classified, help-wanted, real estate and national ad dollars, then maybe you have a chance. But be ready to adapt fast because here comes the age of split-revenue, Groupon-like e-marketing that relies not only on your ability to generate ROI, but to do so before collecting a dime from the advertiser.
How should multicultural marketing execs adapt to these changes?
The first, most important step -- and maybe a difficult one for those who've based careers on targeting one ethnicity -- is to accept that multiple realities characterize multicultural populations. American society is impacted by contradictory realities driven by an accelerated process of individualism and flexible notions of identity. The simple notion of an Asian-American consumer strongly affected by her Indian heritage overlooks how she identifies herself based on her taste for music and politics, her socioeconomic status or religious affiliation, sexual identity, etc.
Technology has enabled people to possess multiple identities, and to traverse time and space constraints. People can talk on Skype for free. Travel is easier. One doesn't yearn in the same way for ethnic recognition when one has continued access to family, friends and culture abroad. The desire may be indeed to be more American, more global and less ethnic.
The challenge for multicultural marketers is to stop seeing multicultural marketing as about "home." Identity is complex and social media reflect this complexity. The marketers who prevail will be those who find creative and dynamic ways to navigate this challenging new landscape.
The multicultural marketing exec -- whether she works in-house or he works for an agency -- can no longer be the "middleman" who serves as a link between the American brand and traditionally defined target communities. He or she must now be a sophisticated marketer creating links between global products and complex multicultural identities played out on a global arena.
Hear from Fortune 500 brands that have been forced to pivot as consumer preferences evolve, as well as entrepreneurs building brands from scratch to meet new consumer needs. This event peels apart the layers of brand building with a carefully crafted roster of top marketing, technology, and creative leaders.Learn more