They have recently emerged as the fastest-growing ethnic group in the United States, according to recent studies. They are among the best educated and the highest earners. Their buying power exceeds $500 billion annually and continues to grow. (Discover more ways to reach a multicultural audience).
And yet, to many marketers, Asian American consumers remain largely invisible.
Even among multicultural consumers, even in a supposedly enlightened age that gives frequent lip service to diversity and inclusion, Asian Americans still are too often overlooked and underestimated as a valuable market segment. Though circumstances have clearly improved from the 1970s — when ads touted detergent formulas culled from an “ancient Chinese secret” — U.S. companies still have a long way to go. As the Association of National Advertisers states in its 2012 Asian Marketing Best Practices report, “To many, [the Asian American market] appears to be a complex and intimidating segment comprising multiple languages and cultures.”
A growing cultural force
Though they represent slightly less than 6 percent of the U.S. population, Asian Americans boast an impressive median household income of $66,000. As a cohort, they demonstrated $509 billion in spending power in 2009 — an increase of 337 percent from 1990.
The Asian American influence is everywhere in the U.S., from various ethnic and fusion cuisines, anime comic art and health/spiritual disciplines like yoga, tai chi and acupuncture. Asian Americans’ assimilation into U.S. culture is evident in the success of a host of actors, athletes, musicians and businesspeople. In all, Asian Americans’ immigration-fueled growth and rapid upward social mobility make them a prized market.
A June 2012 report by the Pew Research Center, titled “The Rise of Asian Americans,” brings into focus just how much growth and impact the group enjoys today:
- Asian Americans have surpassed Hispanics as the fastest-growing racial group in the nation. Immigration has helped push the total population to more than 18.2 million.
- Since 1965, Asian Americans have gone from less than 1 percent of the country’s population to 5.8 percent. (By comparison, non-Hispanic whites represent 63.3 percent, Hispanics 16.7 percent and non-Hispanic blacks 12.3 percent.)
- Asian Americans — about 74 percent of whom were born abroad — surpass the U.S. median in percentage of those with bachelor’s degrees (49 percent to 28 percent) and household income ($66,000 to $49,800).
- Among adults ages 25 to 64 who have recently emigrated from Asian nations, 61 percent have at least a bachelor’s degree. Furthermore, recent Asian immigrants enjoy higher educational attainment than the population of their nations of origin. For instance, about 70 percent of adult immigrants ages 25 to 64 from South Korea and Japan have at least a bachelor’s degree. In South Korea, only 27 percent of similarly aged adults have at least a bachelor’s degree; in Japan the number falls to 25 percent.
Moreover, although this group famously indexes high for technology usage, experts say many Asian Americans hold a special fondness for direct mail — especially targeted, in-language pieces that demonstrate a brand’s respect for this wide-ranging ethnic group. Like many, they appreciate the tangibility of mail as well as its ability to dispense long-form information in an engaging fashion.
Direct mail offers tremendous opportunities for brands and businesses seeking an “in” with the burgeoning Asian American market. With so many marketers swinging for the fences with broadcast TV, online and social media, direct mail allows companies to hone in on Asian American consumers with a pinpoint accuracy that’s hard to replicate via digital and broadcast channels.
“When you receive 20 pieces of mail, and you see one piece that is speaking to you in your language — that is the first piece you’re going to open,” says Jeannie Yuen, founder and CEO of the multicultural marketing firm APartnership. “We have research that shows the open rate for in-language or bilingual direct mail is much, much higher than direct mail as a whole.”
According to marketing experts, the financial, telecom and automotive sectors have become increasingly active in the Asian American marketing space, including companies like Time Warner Cable (see related story, “Found in Translation”). But other U.S. companies seem skittish about engaging the Asian American community. Some speculate that the problem lies in the fact that many American brands already have the trust and support of the Asian American community.
As a group, Asian Americans spend more than the average U.S. household on housing, food, education, financial products, vehicle purchases and more. “Many brands say, ‘They’re already buying my product — why do I need to target them?’” says Saul Gitlin, executive vice president of strategic services for the Kang & Lee agency. “But that’s a double standard — they would never say that about white people who also buy their products.”
Questions about double standards aside, marketers believe that the Asian propensity for modesty — that is, laboring and achieving in relative silence — runs counter to American traditions of grievance and protest. Thus Asian Americans may be unwittingly complicit in their neglected status among marketers. “I sometimes wish Asians would call attention to themselves, because I think they often do themselves a disservice,” says APartnership’s Yuen, who is Chinese American.
Yet another consideration is the potential risks of engaging. The mere thought of inadvertently offending your ethnic target might dissuade companies from romancing Asian American consumers. Just this year, a major ice cream chain was compelled to apologize after it hastily concocted a new flavor inspired by the rise of a certain Taiwanese American pro basketball sensation. Problem was, the ice cream was made with fortune cookies — whose origins have been traced to a traditional Japanese cracker that has no link whatsoever to the player’s ancestral home.
Considering these and other concerns, the question with regard to engaging Asian Americans becomes: “What is the proper way of connecting with a modest, yet tremendously diligent, educated and discerning ethnic market?”
Familiarizing yourself with a few key insights certainly could help …
Can You Be More Pacific?
- First, it pays to know the proportions of the Asian American market. According to APartnership’s Yuen, key Asian American groups include U.S. citizens of Chinese, Korean, Filipino, Japanese and Vietnamese heritage, as well as immigrants and descendants from South Asian countries like India, Pakistan and Bangladesh. A mere 10 U.S. states account for 75 percent of Asian American buying power, including California ($163 billion), New York ($51 billion) and Texas ($34 billion). “Asians can index as high as 12 percent of those local markets, so we tell our clients not to look at this as a national audience,” says Yuen. “Pick your hubs. You can reach more than 50 percent just by going into the top 10 cities in the marketplace.”
- Second, it pays not to view Asians as a monolith. The phrase “Asian” encompasses so many nationalities and cultures that relating to them as a cluster can be futile. Talking to them broadly as single, large group isn’t effective, say diversity marketing experts, because they they don’t identify themselves as Asian Americans, but as Chinese Americans, Filipino Americans, Thai Americans or a similar ethnic group.
Given the polyglot nature of many Asian American households, maintaining an accurate database of consumers and prospects is priority one. Experts advise marketers to stratify their lists according to nationality (one list for Chinese Americans, another for Korean Americans, etc.). Companies can either build their own lists by organizing events in communities and collecting data, or recruiting a list broker that has a proven track record of distinguishing ethnicities within the variegated Asian community.
Due to the nature of the American immigrant experience, it’s equally important to maintain good demographic information.
- Traditionally, the first-generation Asian American is more likely to speak his or her native language
- Second-generation residents usually speak both English and their native language and hold values from both cultures.
- Third-generation members are almost completely aligned with the American culture and language.
If you are confident with the scope and accuracy of your lists, then the next priority is customizing your messages for specific Asian ethnic markets. Yuen and other experts say mainstream marketers often make the mistake of using messages that work well for the general market, but often don’t translate well to Asian American consumers. Yuen recalls a campaign her agency helped coordinate for the California Tobacco Control program. “Asian American attitudes toward smoking are quite different from Americans,” says Yuen. “We discovered through research that Asians are more tolerant toward tobacco companies.
“Some tobacco companies in certain Asian countries are state owned, so there’s no ‘Big Tobacco’ or exposure to anti-tobacco messages. That research has had a huge bearing on the way we present our messages to the Asian segment,” adds Yuen.
Marketers basically advise against taking a one-message-fits-all approach, but there may be one exception:
Despite cultural differences across the ethnic population, experts say many Asian Americans have one big thing in common — they are extremely savvy arbiters of value. Though often unfairly portrayed as cheap owing to their tendency to bargain for lower prices, Yuen says value hunting is a pride-boosting Asian American tradition. “I think we always want to feel like we’re smart,” says Yuen. “There’s a satisfaction that you came out on top.”
Given the Asian American appreciation for a good buy, any direct mail you conceive should showcase a motivating offer where value is clearly indicated. Experts say that Asian Americans tend to educate themselves about products and prices before they buy, so your targeted mailers should emphasize a deal, perhaps bundling as many features and services as possible. “It’s a search for value — value being defined as the nexus of a good price and good benefit,” says Gitlin, of Kang & Lee.
Toward that goal of punching the deal, Asian-targeted mail can get away with being more detail oriented and explanatory than punchier, slogan-based mainstream mail pieces. That’s especially true for services and products that benefit from deeper explanations — “the more you tell, the more you sell” — making long-form copy sent via the mail extremely effective.
Finally, when it comes to your direct mail messaging, few gestures say you care like in-language or bilingual copy.
“We often recommend that our clients do bilingual for direct mail, because within the household the recipient might be first generation/English language–dependent,” says Yuen. “However, within the same household you may have grown or young children who speak and read English. Usually, the parents would defer to their children or someone else who speaks and reads English to make sure they’ve got the information right.”
The Rainbow Approach
At Yuen’s APartnership agency, they call it the “Rainbow Approach.” It’s a phrase they use to describe photos depicting an Asian person chillin’ with a couple of whites and a brown-skinned person of indefinite racial origin. “That’s the mark of a client that is trying to appeal to everyone, and in the end appeals to no one,” Yuen says with a laugh. “It looks like a contrived snapshot moment and misses the opportunity of connecting deeper.”
Rather than take the Rainbow Approach, Yuen says a better option is using photos and scenes that reflect Asian American lifestyles. “Affinity groups are always appealing, so your recipients can see themselves in your message and it’s relevant to them,” Yuen says. “Usually, we can use the same execution across the Chinese, Vietnamese and Korean groups. If you’re limited by budget and you can produce only one version with one graphic, then our recommendation is really to go with no faces, something that is universally appealing, without showing somebody they can’t relate to.”
As the insights suggest, engaging the Asian American market is simply a case of learning to execute ethnically and ethically. If you have any doubts about your company’s ability to follow through, then it’s well worth the cash to hire an experienced multicultural marketing agency to commandeer your initiatives.
With Asian American buying power projected to grow to $700 billion in the coming years, just imagine the profits and brand loyalty to be had if your company pursues this fast-growing ethnic group. “At the end of the day,” says Yuen, “it’s about the bottom line.”Integrated Marketing, Multicultural Marketing, Prospecting, Segmentation