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As the new year begins, we return to our daily routines in the face of a recessionary outlook. Some believe it will be milder, others more pessimistic. may reassess their marketing investments as they act more cautiously about where to invest their resources.
The multicultural industry is of particular concern during a recession, as it has traditionally been one of the few budget items first hit by a recession.
But this year, that may not be the case. It explains why the opposite happens: an increasing interest in multicultural marketing driven primarily by Hispanic consumer segments.
Here are the top reasons why marketers are considering multicultural marketing as a remedy for the recession.
1 – Demographic trend. Traditional white consumer targets are experiencing population decline, while ethnically diverse segments drive all U.S. population growth
2 – The Hispanic segment is focused on consumption. The Hispanic consumer segment tends to use disposable income for household spending. This consumption is important for most B2C marketers.
3 – Better education means more protection against unemployment. Over the past decade, ethnic consumers, primarily in the Hispanic segment, have witnessed an increase in educational attainment measured as high school graduation rates or college enrollment rates. This means better job qualifications, better salaries, and more protection in the face of an economic downturn.
4 – A love of advertising and a loyalty to brands that “know” them. Historically, Hispanic consumers have tended to overestimate their love for brands that not only advertise but, more importantly, have a deep understanding of the passions and culture of the segment and are part of the community.
5 – SME Boom. Diverse segments are leading the creation of small businesses across America. And these small businesses are behind the job boom the country has seen over the past year, despite headwinds such as high inflation and rising interest rates.
6 – Multicultural marketing achieved on a national scale. In the last few decades, multicultural marketing was thought of by many as a regional strategy, but today the impact of multicultural programs is felt nationwide.
7 – Better ROI and effectiveness. A translation-based, total-market approach that targets multicultural segments may fail to deliver results and negatively impact your brand. As such, it has been consistently abandoned by brands and marketers. Never before has marketers had access to so much research, studies, case studies, and ROI models educating the market on how to build an effective multicultural marketing plan.
When we spoke with Gonzalo Del Fa, president of GroupM Multicultural, who analyzed investment behavior during the 2009-2010 recession, we found some interesting patterns:
“Clearly, marketers have already realized that cutting back on Hispanic media investment is not a good idea. It’s growing steadily faster: even in moments of crisis like the last recession (2009-2010), English-language media was hit much harder than Hispanic media (-10.2% vs. -8.6%). ), Hispanic media also recovered much faster (English media +6.5% vs. Hispanic media +8.4%).There are several factors behind that pattern, but in my view the most relevant A high-risk factor is that advertisers engaged with Hispanic audiences already see that in-language media drives higher ROI, with Hispanics driving the most growth in most categories. is that
Marketing under financial pressure in 2023 may require you to act differently than your CMO. The country has changed. There is a new set of consumers that will represent most of the business growth over the next few years. Regarding MC, here are some suggestions on how to invest in 2023.
Rethinking budget allocation
Old behavior: ‘We have to find a budget to support multicultural marketing’
New action: “Reallocate resources from the general market to the multicultural market.”
Rethinking the Total Market
The old behavior: “One brand positioning, one strategy, and one execution for efficiency.”
New Behavior: “One Brand Positioning. Strategy and Execution with the Best ROI.”
Rethink your messaging calendar
Old behavior: “Target multicultural consumers once or twice a year, ideally during Heritage Months.”
New Behaviors: “We will continue to target multicultural consumers as much as possible and bring them closer to the moment they think and act about products and services.”
Facing an uncertain economic environment in 2023 may be natural, but bowing to the quasi-inevitable decline in sales and profits is an option. The economic crisis can bring new opportunities to reinvent brand strategies, modernize marketing techniques and abandon old paradigms.
The Hispanic consumer segment is a priority opportunity this year. Resilient brands tend to understand this opportunity and act on it. Hispanic consumers are inherently resilient and optimistic. As the saying goes, “In the face of the storm, there are those who complain and get wet. There are those who smile and sell umbrellas.”
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