We the People: A Memo on Multiculturalism

Corporate America's leaders—and the next president of the U.S.—must put diversity on top of the agenda, says BusinessWeek reader Esther Novak

By Esther Novak

BusinessWeek reader Esther Novak is the founder and CEO of New Brunswick (N.J.)-based VanguardComm, an integrated marketing and communications firm that specializes in multicultural strategy.

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The recent election has probably settled one long-standing debate: It's worth investing in multicultural markets, whether to win a political campaign or business revenue.

In fact, the success of President-elect Barack Obama's campaign provides a case study for building a brand with appeal to nearly every demographic segment of American society. Two pieces of data that clearly informed Obama and his advisers as they plotted their campaign strategy are noteworthy of note for all C-suite residents, because they tackled them flawlessly.

First, as the U.S. Census has been showing for some time, we are an incredibly diverse nation—the ultimate "stew" of ingredients from every nationality, race, and creed. Second, the various segments of our population don't respond to a one-size-fits-all approach, whether it's getting out the vote or selling diapers. People respond to appreciation for their individuality, and when reached through their preferred channels.

Learning from Marketing 101

You might think this is first-year theory for any business-school student. And you might think your business is already addressing these needs within the multicultural market segments within your corporate "diversity" program.

Yes, a number of companies claim to address "special interest" communities—African, Asian, and Hispanic Americans; gay, lesbian, bisexual, and transgender individuals; Native Americans; disabled citizens; senior citizens; women. Some add other groups to this list, such as Arab Americans, veterans, etc.

However, for many companies, their approaches to these markets mainly arose from legal requirements such as Affirmative Action and Equal Employment Opportunity. While such measures drove a measure of progress toward inclusion, four decades later, sophisticated understanding of these markets and their consumers' behavior seems to have flown past the world view of many marketing departments.

Cultivating Cultural Savvy

To put it simply, merely including images of diverse peoples or translating some marketing materials into another language does not constitute an effective approach to potential customers of diverse cultures. Instead, savvy business leaders can help their teams understand that the market is more varied and nuanced—a richer version of America the Beautiful—than at first glance.

So, what insights should we bear in mind when considering multicultural markets? Start with these facts:

• About one in three U.S. residents is a minority. In fact, the minority population in the U.S. is larger than the total population of all but 11 countries.

• Minorities don't just live in urban areas. Nearly one in 10 U.S. counties is "majority-minority," having more than 50% minority residents, according to data released by the Census Bureau last August. As of July 2007, 302 of the nation's 3,141 counties had more people identifying themselves as non-white than those that labeled themselves white.

• Minority populations have more buying power and a bigger middle-class and affluent sector than you may realize. The University of Georgia's Selig Center for Economic Growth reports that the buying power of Hispanics exceeded $860 billion in 2007 and will grow to more than $1.2 trillion five years from now. For the same period, African Americans spent $845 billion with growth, to $1.1 trillion in five years, and Asian Americans $459 billion, with growth projected to rise to $670 billion.

• Core values and behavior are even more important than language when it comes to marketing to multicultural America. These include the role of family, connection to home country, respect for the elderly, the influence of community leaders, and the roles of faith, tradition, and cultural icons.