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PAUL TYNDALL explains the three Cs every marketer should know before launching a direct campaign to ethnic consumers
Selling to ethnic communities sounds simple enough: Identify and pursue target communities, and watch the profits roll in. Canada’s independent retailers have long catered to an ethnic clientele and now, a growing number of national merchandisers tailor offerings to multicultural communities surrounding their stores.
But how do you tap into quality data about potential customers? And how do you avoid costly mistakes? The first step is to drop all assumptions about Canada’s ethnic communities. The second is to pay attention to the three Cs: caution, care and commitment.
CAUTION: One widespread assumption holds that the ethnic market is one big monolithic segment. It is, in reality, dozens of smaller, distinct segments. What sells to people from Southeast Asia may not sell to those from China. And speaking of China, is that the mainland, Hong Kong or Taiwan? Rather than pursuing all ethnic communities, marketers should identify target communities and focus directly on those.

Another assumption is that Canada’s ethnic communities have massive buying power. True, they spend big. But a high proportion of that spending chases the same goods and services as the mainstream. Ethnic identity has little to do with how people buy gasoline and car repairs, for example. It does have plenty to do with which groceries or books they buy. But these expenditures represent just a portion of their total spending, not all of it.
CARE: Once the decision is made to pursue one or more ethnic communities, care should be taken to learn more about those communities. A formal analysis can help determine the size of the market, along with your ability to capture it.
Direct marketing techniques are useful for testing the waters at this stage. You may already own the information needed to determine your approach. Telephone companies, for example, track countries their customers call and the ones they get calls from, while financial institutions know where their clients send money. Companies that capture this kind of data can use it to craft their offerings.
In-house customer information is another easy way to build a direct marketing database. But care should again be taken because customer tracking based on last names alone is unreliable. Ethnic names can be acquired through marriage or handed down the generations to people who no longer identify with that community.
Somewhat more reliable information can be obtained from census reports, which offer details about the ethnicity of people by geographic location. A grocery store may learn, for example, that many people in its vicinity are Italian-Canadian.
The most desirable sources are self-reported, or permission-based, such as subscriber lists to ethnic newspapers or membership rolls of ethnic associations. These people have raised their hands and identified themselves publicly with their multicultural community. The source of the information determines the nature of the pitch-a more subtle approach for names on an uncertain list, and a more overt pitch to a list of self-identified.
Once the target lists have been drawn up, care must be taken to draft the message the right way. If you send marketing materials to a targeted community in English, you’re telling them that you offer goods and services of interest to them. But if you send out the same materials in another language, you’re also telling them you offer services in that language. Are you ready for people to take you up on that?
COMMITMENT: The last step has to do with monitoring results. A recent survey of 150 marketers found that only 40% consistently did back-end analysis of their direct marketing programs. It costs to pursue these communities, so it pays to figure out if those costs are paying off.
The rewards of reaching ethnic communities can be big and everybody’s jumping in. Wal-Mart carries specialty ethnic products in stores located in or near those communities. Jerry Zucker has said about his takeover of HBC that he wants to localize offerings in stores where there are opportunities. And you can find rapini (a variety of broccoli popular among Italian-Canadians) in a growing number of national supermarkets. So what have you got to offer?
PAUL TYNDALL is general manager at Transcontinental Database Marketing in Toronto.