Terry J. Soto is author of Marketing to Hispanics: A Strategic Approach to Assessing and Planning your Initiative and Grow with America Best Practices in Ethnic Marketing and Merchandising.
Corporate retailers, are you ready? I’m going to ask you a difficult question.
Is your age outpacing your organization’s relevancy?
The topic begs discussion when recognizing that, generationally and culturally, half of all Gen Z consumers (46 percent), and 40 percent of Gen Y and Gen X consumers are multicultural. Conversely, 66 percent of boomers and 80 percent of seniors 65+ are non-Hispanic white.
Commenting on my recent discussion on strategic relevance, Dan Stanek, EVP of Big Red Rooster, replied, “Innovation is more difficult when leaders are much older than the target market and do not understand how they operate.”
Is he right?
Generational and cultural skews represent significant challenges for a lot of today’s senior executives. If they want their companies to remain relevant and in demand, they are tasked at this particular point in marketing history to not only shed traditional views and ways, but to learn to understand and address cultural diversity in younger generations.
The sharper minds in corporate America are already in sync with the country’s age and cultural trends:
- Pamela El, VP of marketing at State Farm told Ad Age back in 2009, “I think industry-wide, as America becomes more multicultural, you will see more ethnic insights across the board. I think we’re seeing it already, but I think we’ll see it two-, three-, four-, five-fold going forward.”
- McDonald’s USA Chief Marketing Officer Neil Golden stated at the 2010 ANA Masters of Marketing Conference, “It’s very clear that African-American, Hispanic and Asian-American consumers set the trends and McDonald’s has found it more valuable to apply these segments’ preferences to the overall marketplace than to apply overall preferences to these segments.”
- Coca Cola’s CMO, Bea Perez, kicking off this year’s Nielsen Consumer 360 conference, noted, “We know that 86 percent of the growth through 2020 for Coca-Cola’s youth-target market will come from multicultural consumers, especially Hispanic, and focusing on this segment is critical to the company’s future growth.”
These are the exceptions, however. The gap is wide between the multicultural influenced Gen X, Y and Z markets and the bulk of U.S. corporate retailers who can’t “see” the relevance in educating their game to new consumer market trends.
In mid-June at the Consumer 360 Conference in Miami, Nielsen’s CEO David Calhoun exhorted attendees to spend 65 percent of their time figuring out their Hispanic opportunity.
“The story here is that within the next five years, multicultural clients will drive 86 percent of the total growth on spending at retail and, if you look at growth without these groups, you are only addressing 10 percent of the growth,” added Nielsen’s SVP, Claudia Pardo at the same conference.