Monday, November 24, 2008

6173: Another Study Uncovers The Obvious.

The Association of National Advertisers presented a study on multicultural marketing, and ultimately discovered the segregated efforts receive insufficient funding, inadequate commitment and inferior performance measurement resources. Wow, they needed to conduct research to reach those common-knowledge conclusions? Anyway, here’s the ANA press release:

Multicultural Marketing Programs Continue To Grow But Marketers Cite Frustration According To ANA Study

Challenges Include Lack of Funding, C-level Support and Adequate Metrics

New York, NY, November 13, 2008 – A new survey of members of the ANA (Association of National Advertisers) indicates that multicultural marketing (MCM) continues to grow as a strategic platform for driving brand and business performance. As the marketplace becomes more diverse, multicultural initiatives have become increasingly crucial for all categories of business. A substantial majority of survey participants (77 percent) have multicultural marketing initiatives, while 66 percent indicate that their company’s efforts have increased over the past few years.

Despite the continued growth and strategic emphasis, frustration among marketers remains high. Only 45 percent expressed satisfaction with the results of their MCM initiatives, with 26 percent somewhat or very dissatisfied.

Conducted by the ANA in partnership with marketing services firm ‘mktg,’ the 2008 multicultural marketing survey is the third edition of the study, following earlier versions in 2002 and 2003. Seventy-four marketers from member companies responded to this August’s survey.

“A focused multicultural marketing strategy is vital to building brands and driving business growth,” said Bob Liodice, President and CEO of the ANA. “Our research shows that multicultural marketing programs are growing and will continue to do so in the future. However, marketers are frustrated and concerned about program quality, with less than half expressing satisfaction with their firms’ efforts to date. There is substantial upside opportunity that can be tapped with the right investment strategies and with well-structured integrated marketing and accountability programs.”

Illustrating marketers’ frustration with multicultural marketing, participants noted a range of barriers and issues:

Only 22 percent of survey respondents said their firm had a high degree of knowledge and disciplined best practices. This includes the inability to consistently integrate MCM programs into the overall marketing mix.
58 percent cited lack of adequate funding
45 percent pointed to insufficient internal support
34 percent noted inconsistent top management support
45 percent of respondents cited a lack of relevant metrics to measure performance

Strategic approaches to multicultural marketing varied. More than half (57 percent) defined MCM as “narrowcasting” – creating separate messaging for distinct market segments and communicating via media that reaches multicultural consumers. This percentage is down from the last survey when 78 percent chose the narrowcasting definition. Other definitions include “mainstreaming,” which repurposes general advertising approaches to appeal to MCM segments (11 percent), and the “translation” approach (10 percent), which simply translates general market materials for outlets catering to multicultural audiences.

In executing MCM campaigns, most respondents (55 percent) said they preferred a multicultural-specific agency for creative development, with about one quarter of firms relying on their general agency of record. However, using a specialized agency was considered the “best practice” based on satisfaction scores.

There are wide ranges of metrics employed for measuring MCM effectiveness. Brand tracking studies (55 percent) and sales growth/volume (54 percent) are used most often. Other measures include market share (41 percent), advertising research (38 percent) and brand equity measures (38 percent). Only one-in-four firms analyze ROI.

The 2008 survey also showed a substantial improvement over the previous survey in identifying market segments targeted by MCM programs:

Hispanic American – 95 percent (vs. 86 percent in 2003)
African American – 76 percent (vs. 60 percent in 2003)
Asian American – 38 percent (vs. 35 percent in 2003)
GLBT (Gay, Lesbian, Bisexual, Transgender) – 24 percent (no data available for 2003 as this was the first year the survey polled marketers on this community)

“With multicultural consumers making up two-thirds of the millennial population and Hispanics representing one-sixth of the U.S. population by 2010, the multicultural market is an increasingly sizable and influential segment,” said Frank Dudley, CMO of ‘mktg.’ “Globalization has reduced the pressure on ethnic communities to assimilate, hence making an insightful understanding of these sub-cultures critical to any effective market strategy. And still, this study’s data suggests marketers have yet to establish standardized best practices.”

As in the 2003 survey, print continues to be the most favored media vehicle for reaching multicultural audiences (65 percent), followed closely by TV (61 percent), sponsorships (54 percent), public relations (54 percent), targeted radio (53 percent), in-store marketing (51 percent) and events (51 percent). Surprisingly, online advertising placed lowest (49 percent).

The survey was fielded in preparation for the ANA’s annual Multicultural Marketing Conference. Now in its tenth year, Multicultural Marketing Conference takes place from November 16-18 at The Boca Raton Resort and Club in Boca Raton, Florida. The ANA’s Multicultural Marketing Committee, established in 1998, helps ANA members share knowledge and best practices in marketing to America’s burgeoning ethnic markets. For more information on the conference or to obtain a complete agenda, please visit

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