Understanding the multi-cultural market

A new study commissioned by Weber Shandwick’s specialist multi-cultural marketing division Multi-Cultural Communications (MCC) has found that ethnic minorities feel alienated by big brands.

The results of the Multi-Cultural Insight Study 2007 were revealed by the Head of MCC, Rakhee Vithlani, at an exclusive event in London on 8 March at Paper, Regent Street, which examined the impact brands have on ethnic minorities. American multi-cultural and entertainment communications specialist Kevin E Hooks, from the Axis Agency in Los Angeles also spoke at the event together with Kanya King, founder and CEO of the Music of Black Origin (MOBO) awards in the UK who shared her experience of working with brands and organisations to reach urban audiences.

The need for brands to understand and communicate with ethnic groups in the UK has never been greater, as they represent a growing audience of around five million it is expected that by 2010, ethnic minority spending power will reach £300bn by 2010. Comparatively in the United States where multi-cultural marketing is a well established business, spending power is expected to reach $2trillion.

Despite these findings, the MCC Insight Study found that ethnic consumers in the UK often feel ignored, with at least one in two people from all ethnic groups, including the white population, believing consumer brands often use ethnic faces in advertising as a token gesture. This perception is particularly strong among the Black African (71%), Chinese (68%) and Indian communities (67%)

At least three-quarters of Asian (77%) and Black (78%) people and half (50%) of Chinese people in the UK are worried that mainstream brands have no relevance to them. Black African and Caribbean audiences in particular feel that very little current marketing and advertising relates to them as consumers.

In addition, 75% of Black, 63% of Asian and 50% of Chinese people believe consumer brands are not aware of how to market to individuals from ethnically diverse backgrounds.

The Multi-Cultural Insight Study surveyed 535 ethnic (Indian, Pakistani, Bangladeshi, Black African, Black Caribbean and Chinese) and 509 White people in the UK, aged 18-35. The survey compared brand preferences within the cosmetics (skincare, haircare and make-up), automobile, fashion, financial and food and drink sectors, and explored attitudes on the representation of ethnic groups in the mainstream media.

In the UK, the 2001 National Census found that 10% of the population were from a non-white ethnic group, with the three largest groups being Asian, Black and Chinese. A third of the population of Inner London and a quarter of the population of Outer London are from ethnic minority groups. In 2003 the Cabinet Office projected that ethnic minorities will account for half of the growth in the working-age population over the ten years to 2009.

Some major brands communicate well with ethnic groups in the UK as part of their marketing, advertising and PR strategies. Tesco, Orange and BT have conducted specific campaigns and reaped brand equity and financial benefits. Diversity within organisations is key too - recently, for example, HSBC announced record profits and directly credited the strength and diversity of their company as the reason for success. Despite this, the MCC Insight Study found that 82% of the black population feel that there are not enough senior people within mainstream organisations.

Researchers also looked at the spending patterns of ethnic groups, and found Black and Asian consumers would be more inclined to purchase a product if they noticed it was advertised to multi-cultural consumers. In some sectors, ethnic minority spending per head is significantly higher: for example, Black and Asian consumers spend 44% more on clothing on average per month than White consumers.

Four out of five Black, Asian and Chinese respondents agree religion and cultural background are important to them, with Black consumers in particular being very strongly inclined to admire celebrities in film, TV, music and sport from their own ethnic background, highlighting the importance of brands using the right celebrities and spokespeople to front campaigns.

Black respondents’ most admired top three film, music, TV and sport celebrities are all of Black ethnic origin, and Asian respondents’ most admired top three film celebrities are all of Asian ethnic origin. Kylie Minogue tops the poll for White, Asian and Chinese respondents but is the least favourite for Black respondents, 39% of whom chose Oprah Winfrey as their favourite TV celebrity, compared to only 5% of White respondents.

There are also major differences in brand preference between ethnic groups. For example, around two-thirds of Black respondents think there are not enough mainstream haircare products available to meet their needs, compared to only 13% of White respondents.

As a result, the top brands for Black audiences in the UK are specialists such as Dark and Lovely rather than mainstream brands such as Head & Shoulders, which was most popular with Asian, White and Chinese audiences. It’s a similar story in the skincare and make-up sectors, where the majority of respondents feel there are not enough mainstream products to suit their skin.

In the drinks sector, 55% of Asian respondents say they do not drink alcohol and thus prefer to spend money on a wide range of soft drinks brands such as Ribena, Tropicana and leading Asian juice brand Rubicon, which communicates very effectively with Asian audiences and is rapidly gaining market share.

In the fashion brands sector, Gucci was the clearly preferred luxury brand of the Asian, Black and Chinese respondents. One in three Black and Asian respondents (33% & 32% respectively) identify Nike as one of the brands they buy most often, compared to only 20% of White respondents. More than half (54%) of Black respondents buy Primark fashion often, compared to less than a quarter (22%) of Chinese people.

MCC head Rakhee Vithlani says: "As the UK becomes increasingly diverse, companies are steadily realising the opportunities of communicating to the multi-cultural market, but it is apparent that many still do not fully understand how to effectively tune in to the spending power of ethnic groups."

Kevin Hooks, SVP at Axis Agency in LA adds: "The maturation of the multicultural market place in the US has taught us a great deal about the effectiveness of customised marketing and communications programmes. As we continue to progress, it is encumbent upon us to share our key insights of the burgeoning global multi-cultural marketplace".