Understanding Ethnic Consumers In Canada, A Study by Nielsen
What: We analyzed Nielsen's study on behaviors of ethnic consumers as opposed to non-ethnic consumers in Canada.
Why it matters: 20% of Canada's population is composed of ethnic consumers, and nearly half of Canadians identify with more than one ethnic group. Yet, there is not enough attention to multicultural marketing above the U.S. border.
According to Nielsen's new study "Understanding the Power of Ethnic Consumers in Canada", there are about 7.7 million ethnic consumers in Canada, which amounts to %20 of the total population. This amount could nearly double by 2036; statistics indicate there will be 15 million ethnic consumers in Canada by then.
Why aren't Canadian marketers as engaged as Americans in better understanding the impact of ethnicity on consumer behavior? For Jack Jedwab, executive director of the Association for Canadian Studies, it could be due to "demographic differences between the two countries and the respective importance they attribute to certain expressions of identity". As he explains, immigration into Canada has evolved over the past decade, substantially changing the amount and variety of visible minority groups.
Not understanding ethnicity risks leading marketers to define their target segments too narrowly.
It is vital for retailers, manufacturers, and marketers to pay appropriate attention to increasingly dominant groups. According to ACS's Jack Jedwab, In the last 10 years, 80% of Canada's population growth came from visible minority groups, which are expected to soon account for the majority of inhabitants of cities like Vancouver and later Toronto.
There is a strong opportunity for multicultural marketing in Canada. As Jedwab points out, "Not understanding ethnicity risks leading marketers to define their target segments too narrowly." Thus, research studies like Nielsen's are a truly useful tool to approach ethnic consumers' behavior.
How Do Ethnic Consumers Shop in Canada?
The first step to come up with a plan to better reach ethnic consumers, says Nielsen, is analyzing data related to the extent to which shopping trips are planned. In other words, retailers and manufacturers can benefit a great deal from knowing whether a consumer bought an item because they intended to do so or because something in the store prompted them to do it. The study identifies three possibilities:
- Planned: Consumers previously plan to make the purchase.
- Reminded: In-store prompts remind consumers of things they might have thought to purchase before.
- On impulse: Unplanned purchases, made on impulse upon seeing something that appeals to a certain desire.
According to the study's results, ethnic consumers don't plan their shopping trips as much as average Canadians, which makes them more receptive and responsive to in-store prompts and displays.
What Do They Buy?
As Nielsen explains, the second step after finding out how ethnic consumers buy is knowing what they buy. Results show these consumers are drawn to products with "better-for-you" attributes, and interestingly, all six attributes taken into account by the study are more relevant to ethnic consumers than they are for average Canadian consumers. The attributes considered in the study were: natural ingredients, no artificial ingredients, health benefits, low/no fat, environmentally friendly, and organic.
The biggest purchase-influencer is natural ingredients, but it doesn't play the same role in all categories. As the graph below shows, natural ingredients are a major influencer when purchasing fresh food, with 31% of ethnic consumers vs 26% of average Canadians considering it an important factor, but not so much in other categories such as snacks.
Marketing campaigns that focus on specific target groups are more successful than others. In order to succeed in multicultural markets, retailers should pay close attention to consumers' habits, and while it's true that it's virtually impossible to take into account each and every one of the visible minorities in Canada, there should be at least the attempt to approach a multiethnic society with the mindfulness it demands, and give diversity the importance it needs.