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Paar 9.23.08 Pdf

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Exploring the Opportunity in Multicultural Markets

Exploring the Opportunity in Multicultural Markets

Published in: Business, Economy & Finance
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  • 1. The New Economic Power Source: Exploring the Opportunity in the Multicultural Markets
  • 2. Expanding Opportunities Customer segmentation is about economics and profitability. The customer segment we traditionally left to the small local brokerage shops that required more guidance might now be our economic lifeboat. That economic lifeboat is the “Multicultural consumer”
  • 3. Being Offensive Organizations often take a defensive approach and adopt a “preserve and sustain” mindset that ignores or discounts the opportunities that present themselves. Pinpointing external change and detecting customer patterns allows you to make sound judgment about where the world is going and putting your business on the offensive to capitalize on changes.
  • 4. Expanding Opportunities
  • 5. U.S. Population: 305,697,961 • Hispanic-American: – 47,201,716 (15.44%) • African-American: – 36,934,442 (12.08%) • Asian-American: - 14,015,166 (4.58%) Source: U.S. Bureau of the Census, August 2008
  • 6. U.S. Population by Race Year U.S. White Black Asian Hispanic Other 2008 305,697,961 201,324,095 36,934,442 14,015,166 47,201,716 3,853,824 2013 320,825,182 204,497,069 39,934,982 15,805,231 53,255,730 4,744,220 % Change 4.95% 1.58% 8.12% 12.77% 12.83% 23.10% U.S. Census 2008 Copyright 2008 Gonzales Group, LLC
  • 7. U.S. Median Income by Race Year U.S. White Black Asian Hispanic 2008 51,485 52,902 34,093 55,162 37,565 2013 58,537 60,901 35,730 61,303 40,582 % Change 13.70% 15.10% 4.80% 11.13% 8.03% U.S. Census 2008 Copyright 2008 Gonzales Group, LLC
  • 8. Multicultural Buying Power Source: University of Georgia Selig Center
  • 9. Multicultural Home Loan Activity Source: - 2005 Mortgage Bankers Association - 2006 HMDA
  • 10. New Arrivals Finding New Homes 12 States with Largest Number of Immigrant Arrivals 350,000 Annual 300,000 average 250,000 post-2000 200,000 150,000 100,000 50,000 0 Source: 2006 American Community Survey, average Vi ts a ey k d ia ia ia a Fl s ew a G is in ew o r an s a on xa id annual arrivals since 2000. et rn th gin rg o rs ol Y or in us Te yl ifo as riz eo Je ar r Ill ar ch A al C M N C N or
  • 11. Immigrants and Boomers In his book, Immigrants and Boomers, author and noted demographer Dowell Myers describes how each of these two powerful demographic influencers may hold the keys to resolving the problems presented by the other. Myers and other demographers Myers argues that during the Myers argues that during the Myers and other demographers believe that immigration can help to demographic transition, the new demographic transition, the new believe that immigration can help to supply some of the workers needed to prospect of diminished skills in the prospect of diminished skills in the supply some of the workers needed to support the rising number of seniors future workforce and aareduced future workforce and reduced support the rising number of seniors and to replace them in the labor force middle class could undermine the middle class could undermine the and to replace them in the labor force as they retire and can help continued growth in home prices. as they retire and can help continued growth in home prices. compensate for the smaller number of compensate for the smaller number of younger adults who are likely to buy Retirees will transition from being net younger adults who are likely to buy Retirees will transition from being net taxpayers to net recipients of health homes from the increasing number of taxpayers to net recipients of health homes from the increasing number of and pension benefits, and they will be older Americans. and pension benefits, and they will be older Americans. supported by aasmaller workforce that supported by smaller workforce that is struggling to meet its own needs. New arrivals alone can offset about is struggling to meet its own needs. New arrivals alone can offset about one-quarter of the increase in the one-quarter of the increase in the Seniors are also net home sellers and senior ratio. Seniors are also net home sellers and senior ratio. Myers believes there will be 67% Myers believes there will be 67% more people in the selling age relative more people in the selling age relative to the younger adults who are likely to to the younger adults who are likely to be buyers. be buyers.
  • 12. Successful Strategies and Solutions
  • 13. Consumer Stereotyping 1. What is a stereotype? 2. What can happen when you stereotype homebuyers? 3. What are some examples of when you’ve been misled by relying on a stereotype? 4. What are some examples of how you have been stereotyped?
  • 14. Successful Strategies and Solutions In our experience, those organizations that have been successful in tapping into this consumer base have utilized four (4) fundamental strategies: 1) Understand and evaluate the demographics of the local market 1) Understand and evaluate the demographics of the local market 2) Develop appropriate products and modify service delivery 2) Develop appropriate products and modify service delivery 3) Get the right infrastructure in place 3) Get the right infrastructure in place 4) Market the message 4) Market the message
  • 15. Strategy 1- Understand and evaluate the demographics of the local market
  • 16. Strategy 1: Understand and evaluate the demographics of your local market In the past, the process for servicing Multicultural markets was often limited to one dimensional efforts such as the literal translations of materials. Successful organizations understand the consumer. They begin by examining their country’s of origin, age segments, median household income and develop a sound marketing plan with measurable metrics.
  • 17. Researching a Market Area
  • 18. Examining Pennsylvania
  • 19. Pennsylvania - Population by Race 2008-2013 2008 Total White Black Asian Hispanic Other 12,505,763 10,214,852 1,275,249 313,980 574,878 106,425 Pennsylvania Total White Black Asian Hispanic Other 2013 12,694,924 10,146,365 1,361,614 357,460 667,175 137,997 Pennsylvania Percentage Change Total White Black Asian Hispanic Other 1.51% -0.67% 6.77% 13.85% 16.06% 29.67% Pennsylvania
  • 20. Pennsylvania - Median Income by Race 2008-2013 2008 Median White Black Asian Hispanic Pennsylvania 49,819 52,682 29,962 54,673 31,368 2013 Median White Black Asian Hispanic Pennsylvania 56,171 59,511 31,804 60,914 33,479 Percentage Change Median White Black Asian Hispanic Pennsylvania 12.75% 12.96% 6.15% 11.42% 6.73%
  • 21. Pennsylvania - 2008 Hispanic Population by County
  • 22. Pennsylvania - 2008 Hispanic Median Income by County
  • 23. Pennsylvania - 2008 Hispanic Country of Origin Hispanic by Country of Origin 299,300 300,000 250,000 200,000 138,773 150,000 100,000 24,820 23,150 23,093 50,000 8,304 7,527 6,502 0 n an n n an an an an a ri a ea bi vi ic ub ic ic tin o in ex u R m C ad r n o Pe to m l M ge cu er Do Co Ar E u P
  • 24. Pennsylvania - 2008 Spanish Language Segment Spanish Language Usage 156,239 160,000 126,773 140,000 120,000 86,874 100,000 70,086 69,117 80,000 60,000 40,000 20,000 0 English Bilingual Bilingual Bilingual Spanish Dependent English Spanish Dominant
  • 25. Pennsylvania - 2008 Hispanic Acculturation Segment AMERICANIZADO English-dominant  Hispanic Acculturation Segments Born in the US, 3rd+ generation  Few Hispanic cultural practices  188,092 NUEVA LATINA 200,000 English-preferred (some Spanish)  163,571 180,000 Born in the US, 2nd generation  160,000 Some Hispanic cultural practices  111,147 BI-CULTURAL 140,000 Bi-lingual (equal or nearly)  120,000 Immigrant as a child or young adult  100,000 65,542 Many Hispanic cultural practices  80,000 46,502 HISPANO 60,000 Spanish-preferred (some English)  40,000 Immigrant as adult; in US 10+ years  20,000 Predominant Hispanic cultural practices  0 LATINOAMERICANO Americanizado Nueva Latina Bi-Cultural Hispanic Latinoamericano Spanish-dominant (nearly no English)  Hispanic Recent immigrant as adult (less than 10  years ago) Primarily Hispanic cultural practices  Identify with home country more than US.  Hispanic
  • 26. Pennsylvania - 2008 Asian Population by County
  • 27. Pennsylvania - 2008 Asian Median Income by County
  • 28. Pennsylvania - 2008 Asian Languages Spoken at Home Asian Languages Spoken At Home 2008 60,000 50,000 40,000 30,000 20,000 10,000 0 an di e i g se c se n th es di lo ea in di ne ne a ga In m H or ar bo pa hi na er Ta uj K am C Ja th G et O Vi C
  • 29. Pennsylvania - 2008 African-American Population by County
  • 30. Pennsylvania - 2008 African-American Median Income by County
  • 31. Examining Harrisburg, PA
  • 32. Harrisburg, PA Population by Race 2008-2013 Year Harrisburg White Black Asian Hispanic Other 2008 531,834 441,441 51,051 13,074 19,246 6,147 2013 546,119 444,524 55,430 15,044 21,984 8,012 % Change 2.69% 0.70% 8.58% 15.07% 14.23% 30.34% U.S. Census 2008 Copyright 2008 Gonzales Group, LLC
  • 33. Harrisburg, PA Median Income by Race 2008-2013 Year Median White Black Asian Hispanic 2008 57,342 59,487 34,620 60,095 28,646 2013 64,829 67,440 40,972 67,886 29,867 % Change 13.06% 13.37% 18.35% 12.96% 4.26% U.S. Census 2008 Copyright 2008 Gonzales Group, LLC
  • 34. Harrisburg, PA - 2008 Hispanic Population by Zip Code
  • 35. Harrisburg, PA - 2008 Hispanic Median Income by Zip Code
  • 36. Harrisburg, PA - 2008 Asian Population by Zip Code
  • 37. Harrisburg, PA - 2008 Asian Median Income by Zip Code
  • 38. Harrisburg, PA - 2008 Asian and Hispanic Age Trends Asian and Hispanic Age Trends 2008 2,500 2,000 1,500 Asian Hispanic 1,000 500 White Age Trends 2008 0 0-4 05-09 10-14 15-17 18-20 21-24 25-29 30-34 35-39 40-44 45-49 50-54 55-59 60-64 65-69 70-74 75-79 80-84 85+ 40,000 35,000 30,000 25,000 White 20,000 15,000 10,000 5,000 0 + 4 9 4 7 0 4 9 4 9 4 9 4 9 4 9 4 9 4 85 0- -0 -1 -1 -2 -2 -2 -3 -3 -4 -4 -5 -5 -6 -6 -7 -7 -8 05 10 15 18 21 25 30 35 40 45 50 55 60 65 70 75 80
  • 39. Strategy 2 - Develop appropriate products and modify service delivery
  • 40. Develop appropriate products and modify service delivery Develop products and services that are relevant and appropriate. Take into account the nuances of the Multicultural consumer such as multigenerational households, religious practices, or language proficiency. Trying to apply mainstream marketing and advertising practices means nothing if the Multicultural homebuyer has no point of reference for U.S. real estate practices.
  • 41. Product and Service has a different meaning and interpretation: For example, take into account that: Hispanics: – Females, extended family and trusted friends often play a role in the home buying decision (home selection, financing, closing, open-house, etc.) – The female, albeit often behind the scenes, plays the important role of home administrator. – Since fulfilling their children’s needs is very important to Hispanics, understand that kids are also your clients. Asians: – Great emphasis is placed on strong family relationships. – It is common for parents to make a generous down payment or purchase a house for their children. – It is also not uncommon to find women in charge of household finances. African Americans: – Tightly extended family units. – Matrilineal organization of family. – Family as clan organization can be seen as the predecessor to the extended family structure of modern African-American communities.
  • 42. Comida Kraft
  • 43. Strategy 3 - Get the Right Infrastructure in Place
  • 44. Is Your Baby Ugly? What do your offices look like and what is its personality among Multicultural home buyers? What does it look like to the prospective Multicultural recruit?
  • 45. Strategy 3: Get the right infrastructure in place (Internally and Externally) Without the right infrastructure, you cannot accommodate Multicultural customers or recruit the right sales professionals. The Multicultural consumer and real estate professional requires language, religious, and philosophical considerations if you are going to win them both as customers or team members. Being respectful of their religion, philosophical beliefs such as Feng Shui, and their English language proficiency are a few things to consider.
  • 46. Cultural Connectivity! Cultural Connectivity is the ability to reach a customer through their cultural context. A few cultural connectors to consider include: – Values – Community – Religion – Lifestyles – Ethnicity – Race – Sexual orientation – Country of origin – Degree of acculturation – Language
  • 47. Train Your Recruiters! • Train your recruiters to screen Multicultural candidates. • It is a fact that untrained recruiters will give highest marks to people most like themselves in appearance and background.
  • 48. Train for Success! •Any Multicultural agent’s success hinges on proper orientation and training. •Be sure all such programs are accessible and culturally friendly to your new recruit. •Make sure training programs that lead to upward mobility and career advancement are available and accessible.
  • 49. Evaluate and Reward! • Many companies have beautifully articulated, well-funded Multicultural programs—but they are mostly comprised of brochures and lip service. • In order to be successful, your company must make Multicultural consumer outreach and recruiting a focal point for evaluation for all Multicultural real estate professionals, not just managers.
  • 50. Recruiting Correctly!
  • 51. Strategy 4 – Market Your Message
  • 52. Strategy 4: Market your message The one-size fits all approach to marketing worked great 20 years ago but the world has changed. Understanding and addressing your target audience through the communication vehicles they prefer is critical. Researching and understanding the literacy rates, media distributions, and identifying community influencers are the first steps to getting your in-culture marketing and recruiting message out.
  • 53. Ethnic Specific Franchises???
  • 54. Perception is Reality! How a community sees a company is how an individual will see the company. This basic concept is critically important when interacting with the Multicultural customer. Many successful companies launch cause related PR strategies that put the Multicultural community and its needs at the center of its communications.
  • 55. “COLORING “COLORING OUTSIDE THE OUTSIDE THE LINES” LINES”
  • 56. What does it mean to “Color Outside the Lines?”  It means moving beyond and outside the doldrums of the norm.  It doesn’t mean being defiant and anti-institutional.  It means finding the strength of an organization and leveraging it, even if it means you color outside the bounds of your defined goals and objectives.
  • 57. What does it mean to “Color Outside the Lines?”  What do these companies have in common? Levis Strauss U.S. Steel Kodak Polaroid Zenith Sears Firestone IBM Timex Nestlé They all “used” to lead in their fields but their They all “used” to lead in their fields but their culture hardened and they “colored within the confines of the culture hardened and they “colored within the confines of the lines” to keep things the same lines” to keep things the same
  • 58. What does it mean to “Color Outside the Lines?”
  • 59. If you sense that you face new customer demands and competition: Any sense that customer demand patterns are changing should be a call to action. Look especially for shifts in the makeup of your total sales and in growth segments, which can often be related to new and non-traditional competition. Ask not if your growth rate is the same but if the causes of growth are the same. Ask not just if new competition is better but whether it offers a “good enough” alternative.
  • 60. Partner With Experts! Don’t try and go it alone. When planning a campaign, identify the appropriate resources. Lastly, Identify a multilingual spokesperson who can champion and be the voice for your initiative.
  • 61. Focus on key aspects of successful Multicultural marketing that include: • Exploring the role of marketing research in the successful development of strategy and tactics for use in the Multicultural market Building your economic as well • Understanding the importance of the quality of person-to-person as your relational equity with interaction. Multicultural home buyers!! • Examine the role of language in advertising. • Understand the need for culturally relevant copy and accurate translations. • Exploring the impact of grassroots marketing. • Appreciating the client’s image of real estate agents and their perceptions about the home buying process.
  • 62. Contact Us: Houston - Los Angeles - San Diego Phone: 888-267-1160 Fax: 281-277-8167 www.thegonzalesgroup.com

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