The Selig Center for Economic Growth at the University of Georgia recently out with a report on African-American buying power, (link to 2006 PDF and link to 2007 press release) which points out that by 2011, the combined buying power of African-Americans, Asians and Native Americans will be $1.8 trillion, with African Americans accounting for about $1.1 trillion of that.
This past year, the report states that African-Americans spent $845 billion (as a group this is as large as the tenth largest country in the world in terms of Gross Domestic Product).
Jeff Humphreys, director of the Selig Center and the report's author, says "In 2007, the Hispanic consumer market in the United States is about the same size as Mexico's entire economy -- in terms of its GDP. The same can be said for the size of the African American consumer market. And I'm becoming convinced the Asian market in America is reaching the point of critical mass, where their economic clout in a number of urban markets is going to create great opportunities for businesses to pay attention to their needs."For your own business, now is a great time to address this trend in terms of your marketing, outreach, and product development. The nation's largest consumer markets in 2006 were California, Texas, New York, Florida, Illinois, Pennsylvania, New Jersey, Ohio, Michigan, and Virginia. Companies and business owners based in those states will benefit from substantial rates of increase in minority spending, so what's your plan to address these trends?
When I was in Oakland, friends looking to get their hair done would mention how most businesses and products catering to African-Americans would be Korean-owned. There exist great opportunities for those of you who are interested in targeting a niche market with your products. Forbes recently put out an article on the rise of demand for natural hair products tailored to "ethnic" hair, citing the rise of companies who serve women who are going natural and not relying on chemical straighteners or "relaxers."
Some ideas as you plan for success in reaching minority markets include:
1) working with a marketing coordinator who knows specific markets and can either translate or help you make appropriate statements in your advertising
2) hiring more diverse staff to bring their viewpoints to your company's knowledge base.
3) taking time to understand census data for your geographic area, as well as national and international trends in your industry. www.census.gov
4) offering translations of your materials, or offering multi-lingual tech support or even a translation widget on your website: Google and Babelfish offer simple plug-ins
5) establishing an "idea group" or committee to research, predict, and brainstorm on how your company will communicate with your expanding market: tap the potential of your current employees or advisors
6) highlighting diverse individuals in your stock photography: use an Asian-American female model for a picture that would typically show a white male
7) identifying ways you may convert your products or create new products that serve the diverse needs of different consumers. Band-aids don't come in just "pink" anymore: they come in all colors and also have cartoons, too!
According to the data, your business retains a competitive advantage if you reach out to and "capture" the minority consumer market first. I'm curious to hear your suggestions, too.
