The Fringe Is In.
"Multicultural" marketing in a millennial world.
Monoculture is dead. And that’s why your old-fashioned “multicultural” campaign is falling flat, especially among millennials.
Millennials — people born between 1980 and 2000 — are the most racially diverse generation in American history. According to a recent Pew Research Report, 43% of millennials identify as non-white, and that number is growing. This year, they will overtake the baby boomers as the nation’s largest living generation. This newly-dominant — and ultra-diverse — generation of consumers brings a unique set of behaviors and attitudes to their interactions with brands, one that differs significantly from the more monolithic perspective of their parents and grandparents.
Huge conducted original research to learn how brands can resonate online with the multicultural millennial audience, which defines itself in part by the diversity of its cultural affiliations. This report illuminates why old notions of multiculturalism are no longer useful to marketers and makes recommendations for how to win millennials’ hearts, minds, and wallets with campaigns driven by insights into their more nuanced behaviors and attitudes.
- How do multicultural millennial audiences differ from their parents and grandparents in what they expect from brands and how they respond to digital marketing campaigns?
- As fringe cultures become more integrated with the “mass,” how can marketers learn from the unique characteristics of individual consumers to create a more effective general market message?
- What strategies can brands use to create a true value exchange with millennials?
- Rather than relying on outdated notions of ethnicity, brands should segment consumers in ways that reflect how they define themselves. Insight-led segmentation, which groups consumers by behaviors and attitudes, will enable marketers to engage them with digital campaigns that are both culturally specific and broadly accessible.
Demographically targeted marketing is dead.
To date, brands have spent millions of dollars on demographically targeted campaigns in response to growing cultural diversity, on one hand, and the opportunity to increase revenue among new audience segments, on another. Many of these campaigns specifically target non-white and non-native English-speaking audiences. This approach is based on an outdated, bifurcated view of the general market: a “mainstream” American culture with distinctive “ethnic” identities on its fringes.
These campaigns, while expensive to implement, have limited reach. They don’t reflect how today’s multicultural audiences understand their identities and express them online. In other words, they are irrelevant at best, and offensive at worst.
This is a mistake brands can’t afford to make, especially because millennials are on their way to becoming the most affluent consumer group. They are reaching their peak earning years right now, and over the next ten years will replace Baby Boomers as the biggest earners. And the opportunity goes beyond the $1.3 trillion in spending power that this generation already holds, because their behaviors are actually transferring upwards to gen X and the baby boomers.
The acculturation model is becoming irrelevant.
Historically, “multicultural marketing” was based on an acculturation model. Consumer acculturation, according to Wei-Na Lee, occurs when immigrant consumers learn the behaviors, attitudes, and values of their new culture, and many studies rely on English language acquisition as an index of acculturation. Historically, for many immigrants, acculturation was an aspirational process: a 1998 article in the McKinsey Quarterly argues that the best way to reach Hispanic-American consumers is to validate Hispanics’ cultural heritage and “their aspirations to make it in the broader context of US society.”
While this model is useful for reaching some first-generation immigrant audiences, it doesn’t account for the complexity of interactions among and between cultures today — a dynamic that has become more pronounced as the diverse millennial demographic enters adulthood.
Demographically targeted marketing is predicated on two outdated assumptions:
- First, that each of these outsider groups is monolithic in behaviors and attitudes: that it’s possible to have a comprehensive “Latino” strategy, for example, or a “Desi” strategy.
- Second, that non-white cultural groups are foreign-born and therefore less likely to be acculturated or assimilated.
Here’s the reality today:
- Across all cultural minorities, the ratio of native-born to foreign-born individuals is increasing steadily. Among Hispanic-Americans, for example, a full two-thirds of millennials were born in the United States. Population growth is driven less by migration than by procreation; younger generations have a different perception of their “Americanness” than their parents did.
- Intermarriage is higher than ever before: 15% of all US marriages in 2010 were between spouses of different cultural backgrounds. That’s double the number from 2000. Today, many families identify with more than one cultural group.
- By 2010, over a third of millennials were parents, and the number of millennial parents stands to grow exponentially over the next decade. As they create their own families, their cultural identities will become even more intermixed as they marry people from different backgrounds.
In many areas of the United States, non-whites no longer constitute the “minority” of the population, let alone a “fringe.” This greater diversity seriously complicates any attempt to define a “mass” or “mainstream” audience.
Case study: Cheerios.
In May 2013, “Just Checking”, a Cheerios ad featuring an interracial family, incited so much racist furor that the comments section on its YouTube page had to be disabled. Cheerios followed up with a sequel last year called “Gracie”, its first ever Super Bowl spot. Instead of reacting to the critics, Cheerios continued to portray its subjects as a regular, loving American family – the perfect response.
Both commercials were a huge win for the brand. People everywhere were quick to celebrate the ads, an impulse that greatly amplified the campaign’s message. In three months, “Just Checking” generated 100 pieces of derivative content -- spoofs, reaction videos, and commentary -- which generated 65% of the video’s 14.4 million views.
“Just Checking” and “Gracie” are bellwethers for a shift in the way Americans, and millennials in particular, think about cultural difference. In an age when cultural spheres are more heterogeneous than ever, what resonates with viewers isn’t this family’s exceptionalism – it’s their normalness.
- For marketers, “ethnicity” itself is a misleading way to segment consumers, because the term suggests clear-cut distinctions between cultural groups that don’t reflect the realities of millennials’ backgrounds and lives.
- As businesses compete for millennials’ loyalty, they will distinguish themselves by speaking to consumers as individuals, not stereotypes. Almost all millennials, Caucasian or not, identify with niche identity groups and with “mass” American culture.
The “mainstream” is changing.
Suburban and rural composition is evolving. Hispanic-Americans, for example, are moving out of dense urban centers and away from traditional ethnic enclaves, but maintaining their cultural ties. Diffusion reduces the pressure to conform to one identity, creating groups with a very different composition than that of the traditional American suburb. Your town square celebrates not just Christmas and Hanukkah, but also Cinco de Mayo and Diwali. Whether you are Caucasian or otherwise ethnic, you are now exposed to influences you never were before.
At the same time, members of the supposed mainstream are finding and claiming niche identities. Through ancestry.com and on Finding Your Roots, to name two examples, Caucasian suburban moms are celebrating the Irish-American or Greek-American heritages that their grandparents may have disavowed in favor of assimilation.
This shift reflects a concomitant change in the way brands interact with their consumers. The broadcast model is obsolete, and with it the passive audience. Instead of dictating norms, marketing messages should offer audiences the tools to define their own identities. Consumers want flexible, authentic relationships with brands that invite participation — so marketers should employ a bottom-up approach that builds affinity among diverse groups of consumers by incorporating multiple cultural influences.
Case study: Michelle Phan.
Michelle Phan’s YouTube channel, which gained popularity with makeup tutorials that Phan shot in her bedroom, has over a billion views and 700,000 followers. This massive fan base is not composed solely of persons of Vietnamese descent: her channel reportedly hosts the most viewed beauty tutorial on YouTube globally, and she has more subscribers than any other woman on the platform. In addition to her large North American following, over ten percent of her audience tunes in from India.
Phan’s tutorials are unconstrained by North American standards of beauty; she inspires viewers to create both practical and whimsical looks influenced by many different cultural traditions. Her inspirations range from Barbie and Manga to grunge culture and the Mexican holiday Día de los Muertos. Anyone can transform their face no matter what they look like, her tutorials promise, and she empowers viewers to explore and perform new identities through cosmetics.
Content creators like Phan are delivering content that brands haven’t traditionally offered: style suggestions, practical applications, and tutorials that are readily useful to consumers. Phan’s intimate, casual tutorials, often shot in her bedroom, offer audiences a feeling of authentic connection. In acknowledging her own cultural and personal background, she’s reaching a diverse mass audience while appealing to viewers individually.
- By marketing to the multicultural mass as a fundamentally heterogeneous one, brands can foster connections with consumers that are personal in their message, but broad in their reach.
- Millennial consumers want inspiration to try something new and empowerment to express themselves. In a 2012 survey, 59% of millennials reported that they buy brands that reflect their style and personality, and 40% were willing to pay extra for a product that reflected the image they wished to convey about themselves (compared with only 25% of non-millennials).
Changes are also happening at a global level.
Globalization has also affected the ways that all consumers, and millennials in particular, interact with brands. For new immigrants and their close descendants, easier connection to relatives “back home” has strengthened their cultural ties. At the same time, increasingly diverse networks of friends and influencers among millennials has broadened the reach of international products and influences.
In other words, “mainstream” culture is less assimilative and more participatory than before. Diverse niche cultural influences permeate and shatter the monocultural mass.
Two factors are driving this shift:
- Technological interconnectedness. When migrants arrived 50 years ago, long distance calls were prohibitively expensive and they communicated primarily through the mail. Now, thanks to Skype and Facebook, people are able to stay in better touch with their relatives in home countries.
- Brand ambassadors. Influences are easily traded between Americans and their relatives in the motherland, a dynamic that actually drives brand affinity. The reach of American multinational brands to global market has long been well-documented -- but among millennial immigrants, brand affinity is more of a two-way street than older theories of cultural imperialism suggest. Many millennials seek “authentic” connections with their home cultures by consuming international brands.
This diaspora effect, driven by technological interconnectedness and the increasing reach of products and services that were once only available locally, is changing the way all Americans define their identities. The same people who trace their roots on ancestry.com are exploring new kinds of international cuisine at their dinner parties, retracing the lines of cultural participation and belonging as they embrace both familiar traditions and new ones.
Case Study: Goya.
Nowhere is the diaspora effect more powerful than in the grocery store: products are quickly moving from the “ethnic aisle” to dinner tables all over the country. In a research study we conducted with young Hispanic-Americans, we were surprised to learn not only how influential they are on their relatives back home, but also how much their cultural traditions permeate their new social groups in the United States.
A number of participants discussed Goya in particular. They go to Mexico, or Puerto Rico, or the Dominican Republic, and fill themselves up on local food. Then, they return home with a longing to recreate that authentic experience. When they call their grandmothers and ask what they should buy in the grocery store, they receive shopping lists full of Goya products. Then, they share meals with their friends, and spread affinity among mainstream audiences for this “authentic” brand through word-of-mouth.
- For millennials, multiculturalism does not evoke “foreigners” who yearn to assimilate into American society. This dynamic has been supplanted by people from many different backgrounds who embrace and celebrate some aspects of their “home” cultures while shedding others, resulting in a richer and more nuanced overall market.
- Brands that try to simplify webs of influence are apt to misfire.
When it comes to marketing reach, assumptions get us nowhere.
What does this mean for marketers? It’s all about identity -- but not in the ways you might think.
Millennials have more in common with each other then they do with particular cultural groups across generations. They are overwhelmingly native-born. According to Neil Howe and William Strauss, just 3.5% of millennials are first-generation Americans, while 20% are second-generation. This generation is diverse — 43% is non-white — and liberal in their political beliefs. And they all crave the same thing: personalized online experiences that allow interaction and invite audience participation.
Therefore, it is critical for marketers to understand how millennials approach their category: what are the attitudes, behaviors and preferences that you can use to craft a more “niche” approach to your millennial target? Use these insights to segment audiences in a useful and meaningful way. Brands should work to understand, connect with and champion existing online communities to gain respect and teach consumers something new.
The right strategy is three-fold:
- Understand how these consumers behave on digital channels.
- Use insight-led segmentation to understand people as personas, not stereotypes.
- Deliver an experience that meets their individual needs.
Behavior must be the ultimate determinant of strategy.
To understand the brand’s capability in digital is to understand its capability overall. Conduct user testing to determine how they shop, what content they consume online, and how they realize their personal identities on digital channels.
In 2014, Huge conducted qualitative consumer research and interviews to support a major beauty and fashion campaign. We wanted to understand the attitudes and digital behaviors of our primary target -- an audience that was 18-35 years old, 80% female and 20% male, and interested in beauty, fashion, and contemporary culture.
The beauty and fashion market is deeply reliant on how consumers perceive themselves and express their unique identities, so cultural background seemed like it might be an important determinant of strategy. But quite the opposite is true: for a generation as digitally engaged as millennials are, digital behavior is the most crucial factor.
Millennials exist between the digital and physical worlds, consuming branded content within a mix of digital, physical, online, and mobile brand environments. They appreciate brands that facilitate online communities and that use social media to involve them in their campaigns. Increasingly, they shop within existing social networks, and they make deliberate attempts to share content that promotes and maintains their social identities.
Social networks serve as an important source for purchasing inspiration and even product recommendations: 47% of Americans say that Facebook is their number one influencer of purchases, and they trust bloggers to provide up-to-date information about new fashion and beauty products. With all the content they consume across multiple devices, they look to their favorite brands for an ongoing stream of images and videos that explore the personality of the brand. And they want beauty brands actively to engage with them, with campaigns like #mycalvins by Calvin Klein.
Understand them as individuals.
By asking the right questions, marketers can understand consumer groups in terms of shared goals, motivations, and behaviors -- traits that actually affect how users will respond to your marketing campaign.
The best marketing strategies deliver credible, curated content that drives loyalty and affinity, which create a true value exchange. Generally, we group this value into access and recognition.
- Access. Users want access to stories or experiences that entertain, educate, and inspire them. Access can be to physical things, like products and real-life experiences, or it can be as ephemeral as content (whether it’s educational or entertaining, or both).
- Recognition. Recognizing their identities and goals can spark real love among target audiences. Use explicit or implicit badges to form connections with users, reward their talents, and help them achieve their aspirations.
Learn how their preferences and behaviors influence and reflect the mass market.
Fringe cultures don’t just permeate the mainstream. Today, they compose it. What marketers learn from particular demographics can help them understand the multicultural mass.
In a presentation at the 2014 ARF Industry Leader Forum, General Mills SVP and CMO-elect Ann Simonds explained how insights gleaned from Hispanic consumers supports the Pillsbury brand’s broader marketing goals. Research showed that many Hispanic home cooks didn’t grow up with Pillsbury products, and therefore didn’t perceive them as being “home-made.” Fresh bread, they believed, comes from the bakery, not a supermarket aisle.
When they dug a little deeper, researchers learned that many millennials shared this point of view. The brand had lost the familiar associations that make it popular among older generations. By repositioning Pillsbury products as “your bakery at home,” marketers reach Hispanic consumers -- and millennials more broadly -- by addressing their unspoken need for a fresh product that resonates with their sense of home.
The cultural attributes marketers might attribute to “diverse” segments often apply across pockets of the “general market” as well. Multicultural millennials identify with their cultural roots and with American culture more generally – and what’s more, Caucasian cultural groups share this point of view more than they did in the past. Lead with the multicultural to reach the mass.
Case Study: Pizza Delivery Brand.
When we wanted to create a new online ordering process for a national pizza retailer, we set out to understand individual consumers in order to reach them more effectively. We began with quantitative research about online ordering behaviors, brand loyalty, and dining expectations.
What we learned.
Our ethnographic and customer research helped us understand what individuals are thinking when they order pizza online. An existing study shows that ordering pizza is about craving, but our observational research illuminated interesting variants. There’s no such thing as a consistent pizza/brand/order-method combination. Instead, relationships between emotions and logic drive purchase decisions.
To understand how the brand’s most valuable consumers make purchase decisions, we used insight-led segmentation. Instead of dividing the audience by cultural background, age, or other broad demographic variable, we defined several distinct personas with common goals and preferences. Here’s our millennial pizza consumer:
The good-time guy.
This persona is usually a millennial and cares mostly about overall speed of service, especially order speed, and quick delivery. We addressed these priorities by placing a “reorder” button front and center on the homepage – no need to start the order from scratch on customizing a pizza, or even to delve into the order history. We also provided more hand-holding post-purchase, providing a countdown clock that allows users to see when their meal would arrive.
Segmenting the most important users into key groups helped us develop a user-centric solution that recognizes that individual needs are different, but gives everyone what they want. For people who love pizza (and let’s face it, that’s pretty much everybody), it’s the way the brand fits into their lifestyle that matters most.
- Almost all millennials identify with one or more niche cultural groups (which don’t always align with “ethnic” categories), and don’t respond well to marketing tactics that presume their aspiration to an American cultural “mainstream.” Therefore, demographically targeted marketing is an ineffectual way to reach millennials consumers.
- Digital is changing audience expectations. Consumers want participatory relationships with brands, which must provide access to new experiences and recognition of their personal goals.
- Marketers should use insight-led segmentation, guided by behavior and preferences, to speak to this audience flexibly and authentically.
- By marketing to the multicultural mass as a fundamentally heterogeneous one, marketers can reach diverse segments with messages that are flexible, personalized, and broad in their reach.
*With Kristen Ames, Huge Ideas.