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Multicultural Marketing to become Mainstream in a Millennial World

As African-American, Asian-American and Hispanic Millennials gain greater spending power, brands that embrace multicultural marketing will stand out from the competition.

In the past, multicultural marketing has been secondary to many companies’ core marketing efforts. But since African-American, Asian-American and Hispanic Millennials have more money to spend than ever before, multicultural marketing is quickly becoming the norm.

Brands increasingly have to understand how to market to young audiences with a wide variety of backgrounds and traditions, remaining inclusive, but also focusing on how each customer is unique.

“If you look at the demographics of Millennials, they are inherently multicultural,” says Kim Collins, former marketing director of Verizon. “When companies think about their marketing strategies, they have to be thinking about how to connect with these groups with very different cultural backgrounds and traditions, and make their products relevant to each group.”

According to Collins, multicultural audiences represent nearly 25 percent of Verizon’s consumer base. For T-Mobile, the number is closer to half. Millennial-savvy companies can’t waste any time engaging the growing multicultural markets. Honda’s latest bilingual creative “Un Buen Fit” (“A Good Fit”) targets Hispanic Millennials in an intelligent way by making fun of Hispanic marketing clichés. Other brands that have been building connections with multicultural Millennials include Toyota, Wells Fargo, State Farm, Procter & Gamble, McDonald’s and Kimberly-Clark, which has a program – “Celebrate FUN” – to drive family pride and motivate families across cultures to come together.

However, between language barriers and cultural nuances, multicultural ad campaigns run a high risk of failing to connect with their target audiences. For example, Volkswagen’s 2013 Super Bowl spot – which poked fun at the Jamaican accent – received mixed reviews. Some criticized the commercial for being racist, while others found the creative amusing.

So what are the multicultural marketing dos and don’ts? Lia Silkworth, executive vice president and managing director of Tapestry, a division of SMG Multicultural, believes cultural insights are the most important factor. She points out that with demographic shifts and social changes across the country, the cultures in cities like New York and Miami are constantly evolving.

“When it comes to multicultural marketing, some of the basics are truly understanding what cultural segments you are talking with and having really deep cultural insights to finding out what opportunities those segments can create for your business,” Silkworth says. “I think it’s very important for marketers to have working knowledge of their target segments’ media habits, behaviors and interests, creating authenticity through research. Even when you think about Hispanics – such a broad term – you may want to treat Hispanics from the U.S., Caribbean and Latin American countries differently. Meanwhile, you may want to target Hispanic Millennials and their older Hispanic counterparts in different ways.”

While many marketers still target individual multicultural segments, total market – a more holistic marketing approach – is becoming the new buzz. Many companies started incorporating ethnic insights into their overall communications and some have even disbanded internal multicultural marketing teams. But Silkworth believes that although total marketing is gaining popularity, multicultural marketing is not going anywhere soon.

by Yuyu Chen