American Melting Pot
Nov 1, 2008 12:00 PM, By Elaine Misonzhnik
There are some retailers that are trying to cater to these communities. Secaucus, N.J.-based Ashley Stewart, for example, targets primarily full-figured African-American women. Meanwhile, in markets such as California, Texas and New Mexico, with high concentrations of Mexican-born Hispanics, Wal-Mart Stores Inc. devotes space at some of its stores to Mexican food products, says Stephen Palacios, executive vice president of the consumer goods business at Cheskin, a Redwood Shores, Calif.-based consulting and market research firm.
However, less attention is being paid to smaller ethnic populations that wield greater individual purchasing power, including East Asians, South Asians and Central and Eastern Europeans, says Monique Tapie, communications director with Global Advertising Strategies, Inc., a New York City-based multicultural marketing firm. With a U.S. population of 14 million, Asian-Americans' median household income of $66,103 results in the collective purchasing power of $453 billion. What's more, because of their higher incomes, they tend to spend more on food, furniture, appliances and clothing than the average U.S. consumer, reports the Selig Center.
But while there are similarities among the various subgroups of Asians, such as a strong focus on family and an emphasis on brand names, there are also differences. South Asians, for example, who come from countries including Pakistan, India, Bangladesh and Sri Lanka, have the highest median household income at approximately $75,000 a year, says Tapie. They tend to be fluent in English, since many are taught the language in their home countries, are heavy Internet users and feel very comfortable shopping at mainstream U.S. stores, according to Morse. East Asians, on the other hand, often come to the U.S. with limited knowledge of English and, to some extent, favor local retailers that offer bilingual services.
“There are at least 13 dominant language groups within the Asian cohort, and there are different forms of Chinese, Thai and Filipino languages,” says Palacios. “Therefore, to target Asians on the basis of their ethnicity you have to have a very niche offering.”
Central and Eastern Europeans, primarily immigrants from the former Soviet Union and Soviet Bloc countries including Poland, Hungary and the Czech Republic number approximately 20 million, according to Global Advertising Strategies, and have total purchasing power of more than $800 billion. Their median household income varies greatly depending on country of origin. Russian-Americans, for example, have a median household income of $67,181 a year, while Polish-Americans have a median household income of $58,207 a year. However, they tend to have similar shopping habits. Many go to local grocery stores for ethnic food but to big boxes like Home Depot, Costco and Target for non-consumables.
Strategic choices
U.S.-based businesses often think that they have to change their entire operating model to court these customers, Tapie says, when all that's needed are small, inexpensive touches like bilingual signs or a section of the store devoted to ethnic products to make people from other cultures feel welcome. The Macerich Co.-owned 963,041-square-foot Queens Center in Elmhurst, N.Y., for example, caters to customers that come from hundreds of different countries with mall translation services that include Spanish, Russian, Mandarin, Farsi, French, German, Italian and Greek, among others.
When it comes to advertising, U.S. businesses would do well to use foreign language newspapers, TV channels and Internet sites. The cost is often a fraction of what it is to place an ad in mainstream media, and the outreach effort yields better results, says Tapie. She notes a large percentage of Asian- and European-Americans are regular Internet users and tend to forgo popular English language sites, opting instead to visit sites in their native language such as www.mail.ru for Russians. And many Asians subscribe to Direct TV's World packages, which include Chinese, Filipino, Korean and Vietnamese channels.
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