Market segmentation involves dividing a population into subsets of consumers who share characteristics, lifestyles and needs, and then targeting one or more of those segments with the most appropriate marketing mix (Kardes, Cronley & Cline, 2008). By tailoring a message to specific segments companies effectively market their products and services to meet the needs and wants of targeted consumers. Bases of segmentation include demographic, geographic, geo-demographic, psychographic and behavioral. Ethnicity, however, is a crucial variable, yet, is often overlooked when segmenting consumers due to unfamiliarity, convenience and costs. The underestimated power of culture is evident in the standardized advertisements, which utilize the same spokespersons, cues, language or idioms for all ethnic groups (Cooley, Brice, Becerra & Chapa, 2015).
Marketers find difficulty in tailoring to specific ethnic-groups because the information on their culture, lifestyles, needs, likes and dislikes result in contradicting findings. For example, some studies find that members of one ethnicity prefer ads with models or actors of another ethnicity (Martin, Lee, and Yang 2004). Due to numerous studies yielding little empirical information on ethnic-specific advertisements, it is difficult to determine whether ethnic-specific advertisements should be favored in multi-ethnic U.S. markets over standardized advertisements (Cooley, Brice, Becerra & Chapa, 2015). In my opinion the problem also lies in the lack of ‘knowing’ of the marketer, most in the industry are unaware of the ethnic diversity between races. For example, Hispanics are often marketed in traditional Spanish language, but the language differs between the 20+ countries where Spanish is an official language. There are also many differences between each country such as religion, lifestyles, cuisines, traditions, culture, etc. The best way to find out about an ethnic-specific group would be to conduct ethnographic and qualitative research on the group. By observing their daily routines, and asking open-ended questions on their opinions, a marketer will gain a better understanding to fit their specific product or service.
As in lack of knowledge, marketers also tend to choose a marketing mix that is most convenient for a large majority of their targeted sample. Many companies simply change the language of the advertisements and keep everything else the same. One of the more successful companies that effectively target ethnicity is Apple. Upon the release of Apple’s new iPad, varying versions of the same commercial were created for different cultures, not only was the language different but the people in the commercial also represented those of that country. For instance, the Spanish version presented a person with tan skin speaking Spanish, for the Asian version, an Asian family appeared speaking Chinese. Companies are implementing these small differences in their advertisements because they are interested in acquiring more of the market share. It is very convenient to create an advertisement that is tailored to the mass; however, convenience is not the best decision when targeting ethnic-specific groups.
A budget is a factor that often influences the target segmentation and the marketing mix. As mentioned earlier with contradicting research marketers would benefit from conducting their own ethnographic or qualitative research. If conducting their own research is not an option than some costs can be overcome by using resources such as the U.S. Census, Geoscape, Nielsen and other databases that collect information on ethnic groups. Geoscape offers extensive lifestyle information for race but unfortunately does not divide the group by ethnicity. It is important to note that the more specific the market is segmented, the higher the costs for the marketer, which is why variables are chosen strategically to include as many consumers as possible.
There are many reasons why culture is underestimated in marketing including unfamiliarity, convenience, and cost. Recently, however, companies have begun implementing cultural differences in their advertisements. Ethnic-specific commercials must tread cautiously to ensure the group is not offended, belittled, or lumped into a category they do not identify as.
-by Laicelis Haro