2010 Trend Predictions for Wealthy Ethnic Consumers
As the fiscal year ends in June, luxury marketers are beginning to think of new ways to reach new consumers. Given the myriad of changes in the marketing and media landscape, there is still a highly qualified consumer segment that is untapped and easy to reach. These consumers are not your usual suspects. And the first luxury provider to execute a strong, non-traditional marketing strategy will catch your eye.
Who are these consumers? Here are some answers:
1. Meet the Royaltons. Multicultural and mass merchants generally refer to ethnic consumers as “minorities.” Within this large demographic, however, is the growing body of wealthy ethnic consumers, and they should be viewed very differently. In their 2008 strategic planning sessions, luxury providers should give special emphasis to this ethnic group, nicknamed “Royaltons.” Royaltons is a term derived from the word “royalty”, which means “of or related to a monarch; a person or thing having a dominant position”.
This under-the-radar but overly influential consumer segment offers a wealth of opportunities and increased sales for luxury providers. It is estimated that less than two percent of marketing budgets are dedicated to attracting this target audience because luxury brands focus on the super-rich consumer or the more obvious wealthy consumer.
For example, Hispanics represent our largest minority, now numbering about 42 million. Of those, six percent earn more than $ 100,000. Merrill Lynch estimates, however, that this relatively small segment of wealthy Hispanics will spend $ 300 billion this year, representing almost two-thirds of the total purchasing power of Hispanics. Hispanics represent between five and ten percent of elite college enrollment; some 40,000 Hispanics are doctors.
America’s most affluent consumer group: Asian Americans, now numbering about 13 million. The number of Asian-American families with incomes over $ 200,000 is roughly the same (156,000) as Hispanic and African-American families combined, according to Packaged Facts. This group represents between 10 and 25 percent of elite college enrollments. Within this group, Asian Indians are the richest and fastest growing ethnic group. Almost 40 percent of all Indians have a professional degree.
A less familiar ethnic group, the Russian-Americans, has come in a rage: some four million people. They are twice as likely to have graduated from college as the general US population and 50 percent more likely to report an income of $ 75,000 or more. They consume luxury items at an accelerated rate.
For luxury marketers in 2008 to better allocate their dollars to Royaltons, it is important that they adopt an aggressively proactive “portfolio attitude” to research, analyze and strategize across the opportunity landscape. This should include a consumer plan, a marketing audit, proprietary research, and a well-crafted strategic plan that leverages existing human capital or identifies new sources of business intelligence.
We anticipate this as the biggest endeavor luxury marketers can tackle in 2008. Just don’t expect overnight miracles.
2. The New Mass Marketing Have you heard the news? Mass marketing is discontinued. Target marketing is all the rage.
Let’s take a specific set of target groups, Royaltons (wealthy ethnic consumers), and build a new mass marketing program. Is that how it works.
You have determined that you want to target a Royalton group, including African Americans, Asian Americans, Hispanic Americans, and Russian Americans. Each will have its own concentric circle that includes grassroots and niche efforts: sponsorships, influencer programs, marketing partnerships, online engagements, retail events / promotions, charity support, and more. These individual concentric circles will work together to build a critical mass which in turn translates into the new mass marketing. And if you’re wondering what resonates with this group, in general, try high-touch engagements that allow consumers to engage with the brand. Traditional advertising is a waste of your marketing money.
Targeting smaller groups of influencers in a cost-effective way may take more time and effort up front, but the payoff of building a plan for the future, making headway in each ‘community’, and developing a meaningful and authentic dialogue with this consumer, it will. be invaluable in the end.
Our recommendation: Don’t let your lack of research or knowledge of diversity get in the way of your brand’s growth. Hire a full diversity expert to act as your chief onboarding officer. This expert will design a methodology for your diversity initiative that includes standard operating procedure guidelines.
3. Women and Wine With all the talk in recent years about marketing to the largest group of consumers and influencers in shopping (women), we predict that wine marketers will eventually put more effort into attracting wealthy consumers. After all, according to a 2006 Gallup poll, women make 55% of wine purchases in America. According to another survey, nearly a quarter of women’s wine purchases exceed $ 100.
Evidence suggests that wine marketers are beginning to recognize the trend, with wine clubs, websites, and ladies’ nights in bars all designed to appeal to female drinkers. There is a low-calorie, low-alcohol wine, White Lie Early Season Chardonnay, with an alcohol content of 9.8 percent, compared to 13 and 14 percent found in some vintages. Displays of rosé and white wines in bottles with flowery names like Seduction have been derided by the womenwine.com website as the Virginia Slims of the wine trade. Wine marketers must understand the most contemporary, wealthy, and successful women. They are not looking for exclusive wine coolers. Unless you are marketing a wine that benefits the Susan G. Komen Foundation, wearing pink or anything that speaks to the “child” within a woman is not recommended.
Aggressive marketers with leadership cultures will customize programs that also target the Royaltons through member-based organizations and associations. This is a huge niche that is currently not being filled by any wine marketer (or other marketer for that matter). Ethnic wealthy women feel more pressure than their white counterparts to be respected and feel a sense of accomplishment, and therefore work harder to achieve it. If you want to reach this consumer in a short time, offer programs that combine their desire for work-life balance and the respect they have likely earned.
Our recommendation: If wine companies want to achieve brand dominance, they must create experiences that maximize women’s social lives and enhance their businesses and careers.
We anticipate that more emphasis will be placed on differentiating products at the retail level that aim to facilitate the shopping experience and purchase decision. This will be accomplished through on-site and off-site events, including weekend in-store tastings, sponsored invitation-only wine dinners at upscale restaurants, and sponsorships of high-profile events of women’s social events and organizations. professionals.