There has been a pivot in the last five years to a new lexicon and strategy of integration in the world of Hispanic, and multicultural marketing. The rapid growth of Hispanic, Asian, African-American and other ethnic populations, and the trend towards ethnic “minority majorities” has moved multicultural marketing out of the silos and into the C-suites of many large companies. What was once a niche is now mainstream.
This growth in ethnic markets has been accompanied by a shift in marketing strategies by major marketers towards efficiency and integration. The result has been an introduction of new marketing models changing the way organizations approach ethnic marketing.
Whenever there is a new trend in business – or society for that matter – there is initially confusion: new terms, divergent definitions, and overlapping concepts. This has been happening in the multicultural marketing industry, with three concepts dominating the discussion and fueling confusion: 1) multicultural marketing, 2) total market approach, and 3) cross-cultural marketing. This was in full view at the recently concluded ANA Multicultural Marketing Conference, where almost every panel and presentation invoked some variation or interpretation of these models.
Establishing benchmarks and a common vernacular are critical. It is important to get the marketing industry aligned towards commonly accepted definitions of these different approaches to ethnic marketing – especially among those who do not work in multicultural marketing yet they make critical financial decisions. I am not alone.
The Association of Hispanic Advertising Agencies (AHAA) recently released the first results of its “Total Market Benchmark Study” to define the “total market approach.” Similarly, a new organization was launched this year called the Cross Cultural Marketing & Communications Association (CCMCA) working to define “cross-cultural marketing.” However, even with these initial positions and a heightened discussion, there is still confusion. Here’s my perspective on what I see as three distinctive models to ethnic marketing.
Multicultural Marketing – targeted marketing efforts to specific, clearly defined ethnic groups.
Multicultural marketing is ethnic-specific marketing precisely targeted to a particular ethnic segment – Hispanics, African-Americans, Koreans, etc. The “multi-” really means separate and distinct and often siloed. This model is the baseline that has underpinned the multicultural marketing industry for the last 50 years in the U.S. This model has led to the establishment of three predominant groups of multicultural marketing specialist agencies: Hispanic, African-American, and Asian.
Model in Practice: Start with the general market then develop separate, distinct ethnic-specific marketing programs connected to the general market by overarching brand attributes or key marketing objectives.
Total Market Approach – one marketing program designed to reach all consumers, across general and ethnic markets
The total market approach describes a controversial, yet increasingly popular new avenue used by many marketers, particularly large national advertisers. According to the AHAA total market study, industry executives define total market as reflecting diversity in all their marketing (including using diverse talent), leveraging cultural cues, and focusing on universal truths to gain efficiencies. While AHAA offers two models to Total Market, I feel that in practice, total market is about the “adaptation” model as a shift away from ethnic-specific targeting.
Model in Process: Start with the general market and then layer or adapt ethnic elements.
Cross-Cultural Marketing – one marketing program that leverages ethnic markets to reach across ethnic and general markets
The difference between total market and cross-cultural is subtle, but important. It’s all about the role of ethnic consumers, which are front and center in a cross-cultural model. Cross-cultural marketing is most aligned with AHAA’s “integration” model and McDonald’s well-known mantra of “leading with ethnic insights.” Ethnic markets drive the general market, versus the other way around in both the total market and multicultural models.
Model in Practice: Start with ethnic segment(s) to develop marketing programs that cross over into a total market definition of the general market.
So is there a right model? I don’t think so. I firmly believe all three models are relevant, in use and providing ROI in 2013. The big question is whether that will be the case in five to 10 years.
Great post, Jose. I have been confused with the lexicon shift myself and this lays it out clearly and concisely. I don't, however, have an opinion on the "best" approach, per se. But what is clear is that multicultural is evolving and this fragmentation of the lexicon is proof of that. Just like HD DVD vs. Blu-ray, at the time we didn't know which one would prevail, but one thing we did know is that DVDs were going away!