How do I find growth in the multicultural economy?

Sizing Multicultural and Millennial Impact

We won’t sugar coat it: Finding growth in today’s U.S. consumer economy can be difficult. However, that task becomes less daunting when you realize the enormous power and influence inherent in the fast-growing multicultural and millennial consumer segments. At Latinum, we find that the key to difference-making, size-of-prize modeling is to start by exhaustively identifying each growth pocket available with multicultural and millennial consumers. Only then can you size these growth opportunities.

Our work with hundreds of brands and ~50 size-of-prize projects over five years has led us to synthesize growth recommendations to four strategy families. Each family has the potential to make a significant impact and deliver substantial returns.

As you read across the four strategy families below, keep in mind that they decrease in incremental investment as you move from left to right, starting with more dedicated investments—those focused exclusively on a single target consumer segment—and moving on to more integrated strategies. This dedicated-to-integrated spectrum is what we refer to as the Cultural Continuum.

Size of prize

 

Strategy 1: New products based on ethnic insights

The most dedicated growth strategy—and also the most expensive and labor intensive—is to develop brand new products, in-house, from ethnic insights. It’s not that these products or services can’t sell to other constituencies, but with this strategy, a company makes a serious bet on a long process of research, product development, new product advertising, and a riskier consumer adoption phase (because, literally, there is no precedent.)

However, examples abound of brands that have done this successfully. Dish’s FlexTV offering, for example, was a Hispanic-inspired new product that succeeded brilliantly with the “no questions, no commitment” tag line initially crafted for Hispanic consumers. Lo and behold, Dish found it resonated just as well across the total market.

On the CPG side, Crest launched the “Expressions” line based purely on Hispanic insights. The product line pulled double-duty and found success with the total market as well even though they heavily overindex Hispanic.

 

Strategy 2: Look externally or internationally for inspiration

Inspiration can come from competitors or even from your own company if you operate internationally. Products that work well in different countries have been imported to the U.S. with great success—often in unpredictable ways. For example, the insights that drive adoption of a certain type of candy in India could also work for multicultural consumers (or any consumer segment) in the U.S.

The advantage of looking at company-owned international products for inspiration is that you have both the blueprints and, by definition, the sales data (although, admittedly, it can be difficult to obtain it in a diversified international operation.) Looking outside the company is great, too.

Colgate’s Fabuloso cleaner was driven by insights on popular cleaners in Mexico and ended up on the shelves of ethnic grocers here in the U.S. These cleaners were heavy on fragrance and color; Fabuloso was created as an EPA-approved version of these agents. However, it is not “just” for Mexican-American consumers. The same scent and aesthetic insights have crossed over to other segments as well.

 

Strategy 3: Expand multicultural “incremental” products to adjacent consumer segments.

This is the classic “reverse multicultural” strategy. For many authentic, foreign brands (particularly in food, beverage, personal care, or other culturally-heavy categories), growth opportunities abound with non-Hispanic white consumers.

Bustelo coffee is a great example: Bustelo originated as a Cuban / Puerto Rican brand, but it is quickly becoming an authentic gourmet go-to. This phenomenon might be centered in Miami, but it is quickly spreading throughout the country.

Another great example—at the company level—is Goya foods. Like Bustelo, Goya is an American company, founded by Caribbean immigrants, originally focused on the U.S. Hispanic consumer. However, Goya’s focus is now on expanding their “authentic” Hispanic foods outside of the ethnic aisle, appealing to white consumers who want to serve something real to their families. This “reverse multicultural” strategy is also tightly linked to the idea of cultural influence, and examples will continue to pop up more and more as multicultural consumers gain more cultural influence.

 

Strategy 4: Activate current portfolio with multicultural consumers.

This is perhaps the most common strategy and what many people mean when they say “multicultural marketing.” There are so many successful examples of this strategy, from Gain laundry detergent to Toyota cars to State Farm insurance.

Many companies find themselves introducing their current product line to multicultural consumers, but it’s not as simple as merely adding some in-language voiceovers or translating a slogan. It’s about making sure the product or portfolio actually resonates with multicultural consumers. The key strategy for finding growth pockets among the existing portfolio is mapping both upside opportunity and alignment with brand values.

 

Detailed frameworks like this one make the Latinum experience unique. We don’t start at the ground floor—we’re already miles ahead because we eat, sleep, and breathe multicultural and millennial marketing strategies. If your goal is driving growth, not checking a box, then you belong in the Latinum Network.

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