Hispanic Marketing: Gaining Consensus to Prepare for the Census

The 2010 Census represents the dawn of a new business reality: the emergence of a minority-majority market. However, many executives still dabble with the decision to allocate leadership, resources and budgets to effectively reach this market segment. Will you wait for the results and play catch-up in 2011? The time is now to gain consensus in order to proactively maximize what the Census will reveal.

Census projections, Sonia Sotomayor, George Lopez, Ugly Betty, Jennifer Lopez, Shakira, GOYA…how many more indicators do business executives need to realize that the influencers and trendsetters of mainstream America are becoming ”browner and spicier”? For example, did you know that Tortillas outsell bread and minorities are the majority in some of America’s largest markets like New York, Los Angeles, Chicago and Miami? (According to the Food Navigator USA and the U.S Census respectively).

The 2010 Census data will empower the proactive leaders and shock the dormant executives. The hypothesis will be validated, and like AdAge recently reported, it will reveal a major shift: “No More Joe Consumer”. So, are you a proactive leader? If the Hispanic and multicultural consumer is not yet a priority in your 2010 business plan, you may be running the risk of being asleep at the wheel.

Beyond the facts and trying to sell you on the case for action, this article is intended to explore key barriers that are bigger, deeper and more personal than the numbers themselves. If you are interested in the numbers, I encourage you to go to reputable sources like AdAge, U.S. Census and the Pew Hispanic Center for this information. Let us instead discuss the organizational consensus required to turn good intentions and numbers into execution and profits.

According to a study conducted for Heidrick & Struggles by Brandiosityreports AdAge, almost half (44%) of executives say companies are not structured  to efficiently conduct multicultural marketing, while 84%, of the same group surveyed, agreed that multicultural marketing is critical to their business. See the contradiction? How can a “critical component” not have the appropriate infrastructure for execution? The answer may not be to rush into hiring a Hispanic Agency or translating your website and “general market” campaign into Spanish. Remember this: without internal consensus and infrastructure, you may get stuck in the wheel of “good intentions.” A good intention without infrastructure is like a 5-star chef holding a recipe with no ingredients to cook dinner… All, while customers are lining up and banging the door, hoping to come in and buy it!

So what can you do? Do not panic. Instead, look into making strategic moves before jumping into tactics. You can still make 2010 your year of gaining consensus before the Census. Here are some quick steps to get you started:

1.      Elevate your Culture! Start by honestly evaluating your Cultural Intelligence™ Quotient “CQ”. This exercise calls for an objective assessment of internal perceptions and management behaviors towards cultural matters. How do leaders and decision makers react when you ask the question: Are you currently investing in the Hispanic market? The answer and potential “justifications” may be an indicator of lack of information and/or personal bias interfering with good decision making. CQ level is demonstrated by the current level of multicultural a.) Senior management support, b.) Understanding of the opportunity, c.) Adoption & investment levels and d.) Measured return on investment. Lacking one or all of these items is a leading indicator of low CQ.

2.      ROI: Calculate Return on Ignorance. Ever wondered how much money you are leaving on the table? While the process of market sizing is a complex discipline, you can start by roughly estimating your current ROI “return on ignorance”. List your current top 5 markets and the sales each represents. Now line up these numbers to the percentage of ethnic and/or Hispanic population that each market has. Finally, factor in a potential “general market spillover” (studies suggest that general market efforts only maximize 1/3 of the total multicultural opportunity). Based on this calculation, what % of your top market sales should be Hispanic or ethnic? Are you getting your fair share? What % of your current budget in those markets is currently allocated to reach these consumers? While the proper process of sizing and planning is certainly more scientific, this quick exercise typically becomes a practical starting point to calculate the potential size of the pie.

3.      Have a Visible C-Champion: Now that you have the size of the pie, a C-level ambassador is critical to move forward. This leader must understand and believe the “numbers” to become an influencer with his/her peers. The C-level and ROI combo is crucial to set the tone and call to action within the organization. The key: realizing that this is not about an altruistic-good-will agenda but a compelling business and profit lever.

4.      Get the Ingredients: An “edict from above” can only go so far. And typically this is where companies fail in their initial attempts and get stuck in good intentions-mode. If your management demands that x% of marketing budgets be allocated to Hispanic marketing without empowering marketers with the resources to succeed; we get back into demanding that the recipe gets made without the ingredients. In fact, the result may backfire with rushed tactics to “check-the-box” without proper evaluation and planning. You will then hear someone say “we tried this Hispanic marketing pilot but it didn’t work out”. If less than optimum resources are allocated, then expect less than optimum results.

5.      Talent and Leadership: Is your talent pool representative and knowledgeable of the markets you are hoping to reach? While most companies tend to separate HR and diversity efforts from marketing, both functions converge when it comes to talent management, competency models and a diversity-friendly succession planning. Great plans and budgets are only as good as the people executing them (or planning them for that matter). Don’t under-estimate your need to acquire culturally intelligent talent. This may include a process of educating your employees, recruiting new talent and hiring cultural marketing advisors and agencies.

6.      Institutionalize: This is fundamental to ensure long-term sustainability. I have seen brands that have reported double digit sales and growth in the Hispanic market which quickly go into a complete halt when the brand manager- who was a believer– moves to another division. This is an indicator of a people-dependent environment. Based on your internal processes and corporate culture, Cultural Intelligence™ must become part of the “mainstream processes” making them inclusive. These “mainstream processes” include new employee training, ongoing skill-set development, customer segmentation models and business planning requirements among others…therefore turning the wheel of good intentions into sustainable execution.

7.      Measure: What gets measured gets done. They key is not creating a separate report card for multicultural, but making your current report card inclusive. If you report monthly sales – which everyone does – make your sales report inclusive by reporting contributions by consumer group. The same applies to other key metrics like marketing mix analysis, campaign return on investment, media planning, employee goals & objectives and compensation models in order to properly track and reward cultural inclusiveness and results.

Net, net, it is not business as usual. Do not let internal roadblocks and personal paradigms get in the way of good decision making. Make 2010 the year to bring “commonCensus” to your organization!