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Minority Marketing

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Minority Marketing Research Paper
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9/16/2012

Minority Research Paper
26 AUG 2012
MKTG 310

American consumer’s needs and wants are forever changing in a world of changing diversity and what makes for a successful business today may not be the same in the future, it’s almost a certainty. Evolving diversity marketing must be studied closely to recognize differences in cultural and social settings in large groups because lifestyles of different cultures are dictated by various values, beliefs, entertainment and interaction. All of these different aspects drive particular wants and needs that are imperative for a company to recognize for self preservation over their competition. The growth and consumer consumption of America’s Minority groups are growing at a compounded rate that has created a new exploding market to be utilized. It’s critical to understand the meticulous data gathered from consumers to create the most effective marketing plan to reach are targeted consumer. The following is an outline covering important demographics of three major minority groups in America including; African Americans, Hispanic Americans and Asian.

I. AFRICAN AMERICAN

A. Total numbers in the U.S.
a. 2011 Black Population: 43.2 million, 14.1% of US

In 2011 US Census Bureau estimates 43,884,130 African Americans 14.1% of the total population of 311.5 million in the U.S. This includes those who identify as Black only and as Black in combination with another race. The Black only category counts 40.7 million or 13.1% of the total U.S. (DeShay)

B. Rate of growth
a. Future Black Population (in millions)
2010 - 42,163
2015 - 44,906
2020 – 47,74
2025 - 50,626
2030 - 53,519
2035 - 56,453
2040 -59,454
2045 - 62,534
2050 – 65,703 (DeShay)

C. Average age
a. There are 35 million African Americans in the United States comprising 12.7% of the total population. This population segment is expected to grow nearly twice as fast as the rest of the population over the next fifty years. The median age of African Americans is 30, nearly six years younger than the median age of the total population. (A.M.C)

D. Percentage with college degrees
a. The census estimates that in 2009, 28 percent of Americans 25 and older had at least four-year degrees, but the rate for black Americans was just 17 percent. (Richards)

E. Average or median income levels
a. 2005 - $31,041, 2006 - $32,465, 2007 - $34,168, 2008 - $35,575
2010 - $33,799 (DeShay)

F. Geographic location(s) – Consider your customers’ geography: African-American consumers are most concentrated in the South and the top five African-American markets are New York, Chicago, Los Angeles, Atlanta and Washington, D.C. (Marketing to African Americans)
a. African American Population by Regions: South – 23,105,082, Midwest – 7,594,486, Northeast – 7,187,488 and West – 4,133,687 (DeShay)

G. Brands that have higher than average purchase for each group
a. The top 10 most attaching category brands for African-Americans are luxury cars/technology/one sports brand (Nike)/and a feminine necessity. (Yahoo finance news)
1) Lexus, 64%
2) Google Search, 62%
3) Mercedes Benz, 61%
4) Google, 60%
5) I-Pod, 59%
6) I-Phone, 59%
7) Microsoft Office, 59%
8) Always, 58%
9) Nike, 57%
10) Microsoft Windows, 57%

H. Products which have above average (spending) usage for African Americans households.
1) Apparel Products and Services-$29.3 billion
2) Appliances-2.0 billion
3) Beverages (Alcoholic)-3.0 billion
4) Beverages (Non-Alcoholic)-2.8 billion
5) Books-321 million
6) Cars and Trucks - New & Used-29.1 billion
7) Computers-3.6 billion
8) Consumer Electronics-6.1 billion
9) Contributions-17.3 billion
10) Education-7.5 billion
11) Entertainment and Leisure-3.1 billion
12) Food-65.2 billion
13) Gifts-9.6 billion
14) Health Care-23.6 billion
15) Households Furnishings & Equipment-16.5 billion
16) Housewares-1.1 billion
17) Housing and Related Charges-203.8 billion
18) Insurance-21.3 billion
19) Media-8.8 billion
20) Miscellaneous-8.3 billion
21) Personal and Professional Services-4.1 billion
22) Personal Care Products and Services-7.4 billion
23) Sports and Recreational Equipment-995 million
24) Telephone Services-18.6 billion
25) Tobacco Products-3.3 billion
26) Toys, Games and Pets-3.5 billion
27) Travel, Transportation and Lodging-6.0 billion (Target Market News)

I. Best media to use to target each group
a. Traditionally, television, radio and print magazines have been the preferred media used to reach this audience, however other channels are growing in their use and effectiveness. The Web has become an increasingly influential channel among African Americans, with new sites such as BlackVoices.com and BlackPlanet.com emerging to target this audience’s specific needs and cultural preferences. (Fabris)

II. ASIAN AMERICAN

The total numbers of Asian’s in the U.S. is 17.3 million.
The estimated number of U.S. residents of Asian descent, according to the 2010 Census. This group comprised 5.6 percent of the total population. This count includes those who said they were both Asian alone (14.7

million) and Asian in combination with one or more additional races (2.6 million). (U.S. Census Bureau)

A. Rate of growth of Asian’s in U.S.
a. 46% growth of the Asian alone or in combination population between the 2000 and 2010 censuses, which was more than any other major race group. (U.S. Census Bureau)

B. Average age
a. Median age of the single-race Asian population in 2010. The corresponding figure was 37.2 years for the population as a whole.
(U.S. Census Bureau)

C. Percentage with college degrees
a. The percentage of single-race Asians 25 and older who had a bachelor's degree or higher level of education. This compared with 28 percent for all Americans 25 and older Information. ( U.S. Census Bureau )

D. Average or median income levels
a. Median household income differed greatly by Asian group. For Asian Indians, for example, the median income in 2010 was $90,711; for Bangladeshi, it was $48,471. (These figures represent the single-race population.) (U.S. Census Bureau)

E. Geographic location(s) – metro, states, etc.
a. The Asian alone-or-in-combination population grew by at least 30 percent in all states except for Hawaii (11 percent increase). The top five states that experienced the most growth were Nevada (116 percent), Arizona (95 percent), North Carolina (85 percent), North Dakota (85 percent) and Georgia (83 percent). These same five states also experienced the most growth in the Asian alone population. (U.S. Census Bureau)

F. Top 10 brands that have higher than average purchase for Asian group.
1) Sony
2) Canon
3) Nike
4) Google
5) Hewlett Packard
6) Coca Cola
7) Adidas
8) Samsung
9) 7-Eleven
10) Yahoo (MC)

G. Best media to use to target Asian group
a. Recognizing the high rates of Internet usage among Asian Americans, Asian media outlets have moved online aggressively. Asians use the Internet at higher rates than any other ethnic group in the country, according to the 2007 Current Population Survey conducted by the National Telecommunications and Information Administration. About 76% of Asian American households use the Internet, according to the latest data available. That compares with 67% of white households, 45% of black households and 43% of Hispanic households. (Project for excellence)

III. HISPANIC AMERICAN
Total numbers in the U.S. 52 million, The Hispanic population of the United States as of July 1, 2011, is making people of Hispanic origin the nation's largest ethnic or race minority. Hispanics constituted 16.7 percent of the nation's total population. In addition, there are 3.7 million residents of Puerto Rico, a U.S. territory. (US Census)

A. Rate of growth
a. The number of Hispanics counted during the 2010 Census. This was about a 43 percent increase from the Hispanic population in the 2000 Census, which was 35.3 million. (US Census)

B. Average age
a. 27 years is the median age of the Hispanic population in 2012. This compared with 36.9 years for the population as a whole. (U.S. Census)

C. Percentage with college degrees
a. Information (source) 62.2% is the percentage of Hispanics 25 and older that had at least a high school education in 2010. 13.0% was the percentage of the Hispanic population 25 and older with a bachelor's degree or higher in 2010. (U.S. Census)

D. Average or median income levels
a. $37,759 was the median income of Hispanic households in 2010 (U.S. Census)

E. Geographic location(s) – metro, states, etc.
a. Number of states in which Hispanics were the largest minority group. These states were Arizona, California, Colorado, Connecticut, Florida, Idaho, Illinois, Iowa, Kansas, Maine, Massachusetts, Nebraska, Nevada, New Hampshire, New Jersey, New Mexico, New York, Oklahoma, Oregon, Rhode Island, Texas, Utah, Vermont, Washington and Wyoming. (U.S. Census)

F. Brands that have higher than average purchase for Hispanic group.
a. The most significant spending difference is in hair care, where Hispanic buying households annually spend on average 43% more on name brands than the general market ($55 vs. $39), while spending a comparable amount on private label products ($7). For baby products, Hispanic households average 15% more spend per year than the general market for name brands ($26 vs. $23), and 10% more on private label (~$6). For health and beauty products they spend 10% more on name brands ($326 vs. $297) and 9% less on private label ($69 vs. $75). (MC Marketing)

G. Best media to use to target each group
a. Hispanics are mobile savvy. 44.7% of U.S. Hispanics use smart phones compared to 31.9% of the non-Hispanic population. And, surveys show that Hispanics are quite receptive to marketing messages if they are done right. According to a consumer survey published in Ad Age, 42% of Hispanics said they are more loyal towards companies that show appreciation for the culture by advertising in Spanish. During the 2010 World Cup, the iPhone World Cup app published by Hispanic network, Univision became the 13th most popular free application in the U.S. If you want to reach Hispanics, go mobile. (Lasker)

BUSINESS POTENTIAL

I. African American
• African Americans have a tendency to be more geared toward tangible items and especially have a greater interest on brand names promoting a positive self image. They have a strong brand loyalty and will rely on certain brands to assist with purchasing decisions. Most popular are categories that fall under automobiles, telecoms, clothing line and hair products. As with any consumer group, not all consumers that are stereotyped from a racial background are alike and it is important to note differences divided into age groups, geography and gender. Marketing data has to always be re-evaluated to confirm product and services reflect directly with representation of their lives. African American buying power will total $845 billion in 2007 and is projected to top $1.1 trillion by 2012 — a 34 percent increase over the five-year period. As the African American consumer dollar sharply rises, marketing has to incorporate more black media over mainstream media and gear more towards their interest and consider more black-interest TV-channels as an example. Marketing can target African American consumption habits and amplify marketing efforts in geographically agreeable areas. (Marketing to African-American Consumers)

II. Asian American
a. Out from all other segments, Asians Americans have the fastest population growth rate of all racial groups. It is also important to note that Asians have the highest median household income amongst minority groups, almost clearing an additional 10,000 on average over other minority groups. This is most likely due to the fact that Asian Americans have the highest educational attainment by percentage in comparison to all other identifiable groups in the Untied States. Asian Americans are educated, fast growing and have a large amount of the owned businesses in the United States, as well as running them. Recently business potential for Asian Americans has been targeted with a wide range to include financial, automotive, retail, travel, telecom and spirits to just name a few. This potential market is huge because of its fast growth rate, wide spectrum of needed goods and services and especially because of that enormous available pot of consumer cash.

III. Hispanic American
a. Hispanic Americans are a large group of minorities within the United States and as of 2012 have become the largest group. Often identified has a lower income median minority group, it’s important to note that their median income increased between (1996-2001), while the US households increased only by 6 percent. Even though recent numbers show an overall decrease in income due to the recession and a high percentage of Hispanic Americans live in poverty, we still have to recognize the gap is closing and the steady increase in Hispanic consumption. All U.S. Hispanic’s do not originate from Mexico, they make up over 20 different Spanish speaking countries and many speak slightly different and have a larger variety within that minority group. It’s also imperative to recognize the huge difference between Hispanics born and raised in the U.S. verses recently immigrated Hispanics. Identifying all of the variables is crucial when developing an effective marketing to target all within a given segment. Hispanics are more likely to try new products and are heavily influenced by family, thus making penetration into the market a little easier. Hispanics are also not bound to “Latino” products; they prefer a large variety to include Latino and American products. (SBDC)

With the current financial times considered, businesses cannot afford to not recognize and identify all potential markets and especially the areas of rapid growth and change. A company not on the edge of change may find hard times with competitors pushing them out of the way. Marketing to people means business has to know them on a personal level. They have to know every convenience desired, every food favored, our spending habits, what makes us happy, what we need to live and most importantly, what we are willing to buy that is worth our hard earned cash.
Works Cited

“African-Americans Show More 'Love' to Brands Than Caucasians”, Yahoo news, August 2012.
A.M.C.” African American Newspaper” The African American Market, January 2012
DeShay, Akiim “African American Population” BlackDemograhics.com, 2011
Fabris, Marissa “Focusing your message for the African American market” Target Marketing, May 2008
Marketing to African-American Consumers. “Business.com” March 2011 “How to Market Hispanic customers”, SBDC 2011< http://smallbizla.org/2012/how-to-market-to-hispanic-customers/>
MC “Marketing Charts”, 2008
Laskin, Zepher, “How Marketers Can Best Reach Mobile-Savvy Hispanics”, Forbs, December 2010
“New 'Buying Power' report shows black consumers spend as economy improves”, Target Market News, September 2011

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Diversity Conflicts

...The differences that make us unique individuals are also sources of potential conflict between us. Diversity in race, gender, ethnicity, sexual orientation, age, and other personal qualities can lead to divisive and costly conflicts in the workplace. By 2031 almost 26% of Canada’s population will be foreign-born and 31% will be visible minorities, according to new projections released by Statistics Canada. Almost half of the working age population will be either foreign-born or have at least one parent born in another country. In Metropolitan areas such as Toronto and Vancouver, the visible minorities of the present will be the majority, while their population will double in other Canadian cities, such as St. John’s, Nfld., Kelowna, B.C., and Ontario cities like Barrie, Hamilton, Kitchener, Oshawa and Peterborough. Canadian demographics are changing in part due to real and projected labour shortages. As the economy grows and Baby Boomers retire, there are not enough Canadian-born workers to meet the demands for skilled labour. Employers then look to other countries with large talent pools, such as China and India, to fulfill those needs. What this means for Canadian workplaces is things are going to look and feel very different. They are going to be much more diverse and the effects of this diversity need to be understood. Foreign-born people come to the workplace with different values, ethics, expectations and modes of communication. Conflict is a natural result of the misunderstanding...

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