Culture is Driving Growth

Author: Annette Malave, SVP/Insights, RAB

Over the next 20 years, the U.S. population will be comprised mostly of multi and intercultural individuals according to U.S. Census population projections.  This growth is attributed to the increase in the number of Asian, Blacks/African Americans and Hispanics/Latinx in the country and is being viewed as the catalyst of brand and revenue growth by advertisers and marketers alike.

Combined, these groups are projected to yield a buying power of $4.7 trillion by the year 2020 – up from $3.8 trillion in 2017, according to Nielsen.  Despite this projection, the dollars spent to target and advertise to  multicultural consumers remain relatively low.  While 37% of the U.S. population was comprised of Asian Americans, African Americans and Hispanic Americans in 2018, only 6% of advertising and marketing dollars were targeted to these segments, according to a study compiled and presented by Dr. Leo Kivijarv of PQ Media at the 2019 ANA Multicultural and Diversity Conference.

One insight shared consistently throughout the conference was that “if you are not doing multicultural marketing, then you aren’t marketing.” Marc Pritchard, Chief Brand Officer with The Procter & Gamble Company, shared how P&G is incorporating multicultural influences and culture, via consumer insights and real people, into their marketing efforts and he is attributing both market and sales growth to this shift.

The reason behind this is simple. “Consumers connect more deeply with ads and brands that reflect culture genuinely through inclusion and acknowledgment,” stated Carlos Santiago, President and Chief Strategies, Santiago Solutions Group. The ANA’s Alliance for Inclusive and Multicultural Marketing’s (AIMM) set out to gauge the extent to which culture in ads and content can drive brand growth and created a new metric – Cultural Insights Impacts Measure™ (CIIM™).  CIMM™ identifies the impact and effectiveness of cultural insights in ads and programming and their potential to increase brand/product sales.  Based upon a pilot study of 162 video/TV ads, when culture was considered and included as part of an ad campaign, it:

  • Enhanced brand perception 2x
  • Increased ad effectiveness 2-3x
  • Lifted purchase intent 2.7x

But it’s not always just about multicultural consumers seeing someone like them in ads.  It’s also important that they hear someone like them or hear it in their language along with using media types that have the highest reach, specifically radio.  According to a case study presented by Monica Narvaez, VP Sales Director with Nielsen, when a TV-only advertiser in NY shifted 60% of the budget to Spanish Radio, that advertiser saw a 350% increase in GRPs and incremental net reach of 77%.

Whether it is language or ethnicity, culture influences everything – from food to clothing to music and more. Yes, culture drives growth.

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