Twenty-First Century Marketing Means
BY HOWARD RIELL
In its July 12th cover story, Business Week noted that companies like Coca-Cola, McDonald’s, General Motors, American Express and others are “standing mass marketing on its head by shifting emphasis from selling to the vast, anonymous crowd to selling to millions of particular consumers.” More, it pointed out that the evolution from mass to micro-marketing is a “fundamental change driven as much by necessity as opportunity. America today is a far more diverse… society than it was in the heyday of the mass market.”
Restaurant and bar operators and their suppliers are wisely following suit, tailoring their beverage-alcohol marketing messages, advertising vehicles, products and promotions to a variety of niche markets, especially ethnic groups like African-Americans, Latinos and Asians.
The strategy calls for a deft touch, solid intelligence and a deep appreciation of what motivates these increasingly prominent groups. As Business Week points out, the effectiveness of mass-marketed messages is beginning to wane.
‘COMMITTED TO MULTI-CULTURAL MARKETS’
“A lot of it is looking at your venue, and who your target customer is,” says Adam Seger, general manager at Lettuce Entertain You’s 175-seat Nacional 27 in Chicago.
Sometimes overlooked in the rush to niche marketing is the fact that members of a particular ethnic group are as likely as anyone to vary their dining and drinking habits. As Lawrence Moskowitz, vice president of strategic marketing services for Kang & Lee Advertising in New York City points out, there are a lot of misconceptions about dining and drinking habits.
“For instance, that Chinese won’t eat Italian,” Moskowitz explains. “That’s BS. Go visit Hong Kong. Go visit Taiwan. Go visit Shanghai. You’re going to find a ton of good Italian food. People are global now. My name is Moskowitz, and I eat Chinese food, not Russian. It’s America; let’s keep that in mind.”
Clearly, offering a choice of certain Asian beers can be beneficial. “Believe it or not, if you want to really dig deep you can go beyond Tsingtao,” says Moskowitz. “Tsingtao is kind of the ubiquitous Chinese beer in all the Chinese restaurants. It’s the number-one brand in China, and you see it in a lot of places. But there are beers from Korea and Singapore, and having that variety of beer might allow you to do something interesting.”
Moskowitz says restaurant and bar operators can always further their niche marketing agenda with carefully selected appetizers. There is, he notes, “bar food beyond pretzels that might appeal to an Asian audience, like wasabi peas or dried squid. A lot of other little Japanese snacks are popular, too.”
What operators want to avoid, says John Alvarado, manager of multi-cultural markets for Jim Beam, is assuming that all Hispanics are the same. “That’s where it comes back to understanding what consumer groups come in through their door. Get to know them.
“It’s really a matter of Jim Beam being committed to the multi-cultural markets,” says Alvarado. “One, they are a unique audience that is growing in terms of their size as well as buying power and their influence on America. If you look at what’s going on, particularly in the metropolitan areas, the urban culture is driving a lot of the trends overall.
“Specifically in terms of our marketing structure, we feel it’s an important opportunity for us. That’s why we hired the IAC Group, which has tremendous expertise in building brands in the Latino market.”
Indeed, Beam contracted with The IAC Group recently to handle ethnic marketing responsibilities for Jim Beam Bourbon, DeKuyper Cordials and Puckers. The goal is to move to an integrated, multi-platform Latino campaign for both Jim Beam and DeKuyper.
‘BUZZ’ AND ‘ENERGY’
On Fridays and Saturdays, Nacional 27 starts off as a fine-dining restaurant, but at 11 pm, the dining room tables make way for a dance floor, when salsa and meringue take over. “We have to have a certain mix of Latinos in the club just because of the atmosphere we’re trying to create, and then obviously the salsa community,” says Seger. “It’s really important for them to patronize us because it adds to the buzz and the atmosphere, even for we who aren’t Latinos but who want to see that dancing and that energy.”
Corona attracts Spanish-speaking consumers.
A large part of creating the ambience is Nacional’s specialty cocktails. Top sellers include Mojitos and Cabalinos and Pisco Sours (Pisco Capel with lemon and passion fruit). Also for sale are Latin beers. Says Seger, “We don’t do any domestic beers at all. From Mexico we have Negro Modelo, Pacifico and Corona. We’ve got Cristal from Venezuela, Pamalukas from Brazil, and Moda from Guatemala.”
Nacional channels a lot of its marketing resources through the annual Salsa Congress as well as other special events in the salsa community. “It’s basically a salsa convention which brings together people and teachers from different salsa schools who are very passionate about it. It includes everything from seminars and competitions to the dances and contests. That’s where we have an opportunity to go to more as a sponsor to keep our names out in the community.”
Lettuce Entertain You strives for balance with Nacional’s marketing efforts. As Seger explains, ads are run both in and out of the salsa community. Two monthly print vehicles that have proven effective are Chicago Social and CS Men’s Magazine, both “very, very high-end luxury” publications.
“So we get a combination in the club. We have the hardcore salsa dancers, and then we have a very upscale, late 20s/early 30s professional crowd. They come either because of the energy or excitement of the dancing, or some of them have taken dance lessons and are starting to salsa dance. It gives us a nice combination because it’s not all Latin and it’s not all very homogeneous young professional group,” Seger says.
Nacional serves three different Mojitos: the N27 Mojito (Bacardi Limon, lime, mint, Angostura and a splash of soda); the Cielo Mojito (Skyy Citrus, hand-muddled lime and fresh mint); and the Mojito Martini (Hangar One Kaffir Lime Vodka, fresh lime juice, whisper of dry vermouth, crushed mint, shaken and served).
A PIONEERING VOICE
“Something that has really always held true with Schieffelin is a focus on, and expertise in, multi-cultural marketing,” says John Santos, senior brand manager for Schieffelin & Co. “While we might not have known it at the time, that’s what it was. The founder of the company, William J. Schiefflin, is kind of a pioneer in that respect.”
Schiefflin, he notes, was one of the first corporate supporters of the NAACP, in 1909. The company’s founder sat on the board of The Tuskegee Institute, part of the National Historic Black College Network.
Recording artists OutKast, including singer Andre 3000,
right, team up with Navan for a promotion.
“Back in those days, in the 1930s, ’40s and ’50s, it was not really quite the popular thing to do,” Santos points out. “Hennessy was actually the first spirit to advertise in Ebony magazine, in 1951. We began to advertise in Jet magazine in 1953, and we started to advertise in the black press nationwide in 1960. William Schiefflin was a pioneer in understanding that you’ve got to broaden yourselves. I think it comes back to the tenet of doing what’s right for the community. In terms of marketing luxury brands, sometimes the only color that really matters is green.”
There are, Santos explains, several “central tenets” that his company follows in marketing to the African-American community. “Obviously,” he notes, “one of the things you need to do is make sure you really know your consumer. One of the things that a lot of marketers could fall victim to is treating ethnicity as one monolithic group. There is incredible diversity within the African-American segment, within the Hispanic segment, and of course within the Asian segment.”
Clearly, education is called for. “Once that is underway,” he continues, “you are going to need to marshal your resources within your organization to make sure you can deliver against that. That means you have to make sure you have multi-cultural expertise within your organization, hopefully through your employees.”
That can come by working with agencies that are also “very tapped in to those communities,” he adds. “For us, and this is no secret, it’s a consistent presence and commitment to reaching out and working with the different communities.”
Grand Marnier says Navan, a fusion of Cognac and black vanilla from Madagascar, is ‘trans-cultural.’
According to Santos, Schieffelin chooses its media mix based on relevance to the community. “Making sure, for example, that we continue to advertise in Ebony and Jet. Continuing relationships. Trying to be in the appropriate magazines that are carefully chosen to reflect the upscale and luxury positioning of the Hennessy family of cognacs.
“There are a lot of vehicles out there, but it’s about carefully selecting the ones that would position Hennessy as the luxury brand it truly is.”
Constructing a marketing program targeting any group, says Alvarado, must include “starting out with a deep knowledge of the consumer. We’ve done a lot of strong research to help us understand exactly what their needs are, what motivates them, and what they’re looking for in brands. From there we’ll build a campaign that consists of print and radio as well as on- and off-premise promotions.”
The brand attributes Latino consumers are looking for that Beam believes mesh well with their products, he explains, include a strong heritage and sense of tradition. “The (Beam) family is a great traditional vehicle, but also important is to show that they’ve been developing products for quite some time.”
The Latino community has a powerful sense of pride in who they are, what they do and their countries of origin. All of those play well in terms of what Jim Beam stands for, Alvarado notes. “The fact that one family has worked on the brand for over 200 years; that, we have found, has been a great platform to speak to [Latinos] from.”
In order to educate Spanish-speaking consumers, it makes available a variety of bilingual point of sale materials. On-premise, Beam has developed signage, banners, permanent point of sale, and giveaways that have included Jim Beam Black baseball caps, and medallions, which he points out are popular in the Latino market. “We took the number-one rating in the Beverage Testing Institute’s tasting of bourbons, so we created a medal based on that.”
IAC’s campaign will target Latino consumers in New York, Miami, Chicago, Los Angeles and Houston with both print (Maxim Espanol, Futbol Mundial and others) and out of home ads. Radio figures to play a central role. As Alvarado explains, “radio is a great medium. (Latinos) over-index in terms of their consumption of radio. It’s typically on 24 hours a day in the household, as well as the workplace.”
Many operators, he adds, have tapped into the fact that Latinos appear to have a strong affinity for brown spirits. This comes in handy when it comes to creating and marketing mixed cocktails. One cocktail he says he proven a “great hit” has been Jim Beam and 7-Up. “We’ve also had great success with the Beam Margarita, which is something unexpected,” says Alvarado.
And carefully selecting marketing vehicles has become the name of the game in 21st century America.
WHO WE ARE NOW
According to the 2000 Census, the U.S. population includes 34.7 million African-Americans, 35.3 million Hispanics and 10.1 million Americans of Asian descent. Growth trends show that these populations will continue to fuel the growth of the total population. In fact, while the White population grew only 5.9 percent between 1990 and 2000, the African American, Hispanic and Asian populations combined grew 35 percent.
Other vital information for marketers includes:
The population identifying themselves as African-American grew 15.6 percent between 1990 and 2000 to 34.7 million. An additional 1.7 million people identify themselves as African-American in combination with another race.
54 percent of African-Americans reside in the Southern U.S.
The median age of African-Americans is 30.3 years compared to 35.3 years for the total population.
There are more African American households in the U.S. – 12.1 million – than any other ethnic group.
At 35.3 million, Hispanics are the largest ethnic group in the U.S.
The Hispanic population is the fastest-growing ethnic segment. The Hispanic population grew 58 percent between 1990 and 2000.
Nearly half of all Hispanics live in the Western U.S.
Hispanics are a young population with a median age of 25.9 years.
Hispanic households are larger on average with 3.9 members per household.
The Asian American population numbered 11.9 million, or 4.2% of the total U.S. population. This population is highly concentrated, with over half of all Asians residing in three states (CA, NY, TX). In California, which is the single largest state market in the country, Asians represent 12% of the state population.
With 49% population growth between 1990 and 2000, Asian Americans have the fastest population growth rate of any racial group in the nation
Asians have the highest median household income of all groups in the U.S. – almost $10,000 higher than that of Caucasian households and the highest level of educational attainment of all groups in the U.S., with 44% holding at least a Bachelor’s degree
Asians also have one of the strongest rates of business ownership, managing more than 800,000 businesses nationwide that generate $302 billion in annual sales.