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Know Your Audience

March 1, 2013

Direct Marketers Tap the Power of Multicultural Consumers

By David Ward

In our digital-obsessed age, one of the best kept secrets in marketing is this: Traditional print direct mail still works. And not only that, but direct mail programs aimed at multicultural audiences can be even more effective than those targeting the general public.

“It’s been solidly shown that multiculturals tend to have higher read/response rates for direct mail,” says Karen Sinisi, director of sales and marketing for South Hackensack, N.J.–based Ethnic Technologies. “They catalog their mail and they [come away feeling] they are being spoken to directly — they take every piece and consider what the messages are.”

These higher response rates are true both for Latino audiences in the U.S. as well as Asian-Americans. Saul Gitlin, executive vice president of strategic marketing services at New York–based Kang & Lee Advertising, which specializes in Asian marketing, says he has been pushing the agency’s banking and insurance clients to build more robust direct mail programs. “Every time we do a program like that for a client, their eyes widen at the level of response they receive,” he says.

This doesn’t mean that marketers targeting Latino and Asian populations in the U.S. are counting on direct mail alone to drive messages and offers. But it does mean that they are looking at direct mail pieces to assist with key marketing efforts — everything from new lead generation to product and service introduction/education to building loyalty as part of an overall multicultural marketing mix.

“Research has shown that direct mail is an effective way to complement our advertising strategy,” says Beth Ward, marketing communications director for the insurance giant State Farm. “Our direct mail pieces are designed to stand out when they’re delivered to multicultural consumers, and speak to them in their language of preference, whether that be Spanish, Vietnamese, Korean, or Chinese.”

Direct mail recently played a major role in Los Angeles–based BBCN Bank’s “1-1-1” campaign that celebrated both the one-year anniversary of the bank’s merger and its position as the No. 1 Korean-American bank by offering its customers a 13-month CD with a one percent rate.

“We did a lot of digital and mobile marketing for this promotion, but we also did a lot of off- line, including direct mail,” says Jimmy Lee, BBCN’s senior vice president for marketing and communications. “The direct mail response for the Korean-American segment tends to be higher than the general population, provided it’s done in culture and in language.”

One reason why printed direct mail tends to be particularly effective with multiculturals is that it is often read by more than one person in a target household. In the immigrant community, the family tends to be larger and multiple generations may live under one roof. “So a well-crafted, linguistically relevant piece can attract the attention of a bunch of people in the same household,” Kang & Lee’s Gitlin says.

Drilling Down with Data

Jeffrey Bowman, who heads cross-cultural practice at ad agency Ogilvy & Mather, says the biggest mistake he sees from brands is a failure to deeply understand their multicultural audience before they embark on a direct mail, or any other marketing, campaign.

“Where they typically fall down is they don’t want to do the research — they either pull it from secondary sources or go to places like Google, and that really doesn’t get to a cultural truth,” Bowman says.

Apparently, there is no excuse for that. Today, new technologies are putting better data about ethnic households right at the fingertips of marketers. Smart brands are using a combination of information sources along with robust analytics to target not only multicultural groups but subsegments within the larger groups.

“Direct mail is a channel, but you really need the right program if you want people to give your piece a second look,” explains Tito Colon, head of multicultural marketing, community relations, and urban marketing for Hartford, Conn.–based Aetna. “We do a lot of work to establish insights on a particular segment, and then we get really granular. Using the Latino segment as an example, we take into consideration the different perceptions and cultural nuances of people of Cuban, Puerto Rican, and Mexican origin.”

Some larger brands have the resources to develop their own internal databases and analytics for identifying and targeting subsegments within a larger multicultural community. But smaller brands — as well as advertising agencies — also can gain such insights by turning to outside market research companies like Ethnic Technologies, which provides data processing and appending, list encoding, and analytics to help clients gain vital intelligence about their multicultural customers.

“We specialize in identifying not just ethnicity and language preference but also assimilation levels on customer data,” Sinisi says. “We have a predictive software system that we developed in-house — and continually improve upon — that looks at every record in a database and attaches different values for ethnicity, language preference, assimilation levels, country of origin, and other elements tied to ethnicity.”

While clients use this data for a number of purposes, including determining which languages are spoken by operators at a company call center and in which languages contracts are written, Sinisi points out that this data is most helpful in guiding the development of direct mail pieces.

“We’re finding that our data is being used in real time; one mail piece is printed one way based on information we gather, and another piece is printed a different way based on other data we provide,” Sinisi says. “That’s being done in order to establish a one-to-one marketing connection.

Language and Cultural Cues

In creating multicultural direct mail, marketers are always faced with the question: In which language do we print our pieces?

“The choice of language is important because it often relates to assimilation levels, especially in the Hispanic population,” Sinisi says. But she warns against automatically assuming that the more assimilated a multicultural consumer has become, the more likely they are to prefer messages in English.

“When you look at Asian multiculturals, for example, Chinese tend to be way higher on the assimilation scale and also way higher on the education and income levels,” Sinisi explains. “But many actually prefer to have things in the Chinese language and to correspond and speak in their native language.”

Aetna’s Colon suggests that multicultural marketers can rely on a combination of their experience and data when deciding what language to use in a direct mail piece.

“It’s really more art than science, and you have to understand what your goal is,” he says. “Sometimes speaking to an acculturated Hispanic family in Spanish can be a turnoff, so here at Aetna we may take an English message and place it into a Spanish channel because we want to [effectively] speak to an acculturated crowd that wants to make business decisions in English, but relaxes into Spanish for entertainment.”

State Farm’s Ward says it may seem obvious, but one thing the company has learned is that it’s important to take not only language but culture into account. “Oftentimes marketers think they can just translate something that’s been created n English — but there are lot of pitfalls to that,” she says. “At State Farm, we strive to ‘transcreate’ with an emphasis on tailoring just the right message for this customer.”

Kang & Lee’s Gitlin agrees. “Sometimes a client wants to take a program aimed at the general population and have us adapt it for a particular multicultural target audience. But whether we do that or build creative from the ground up, we are always looking for the right cultural cues to connect with that audience,” he says.

Those cues can shape anything from the tone of the message, to the color palette of the printed piece, to the numbers spotlighted in a promotional offer.

“There are certain numbers and colors we avoid,” BBCN’s Lee says. “For example, in most Asian cultures the number four depicts death, so we stay away from that. We also try to be sensitive to certain color schemes. In many Asian cultures you don’t want to write a person’s name in red typeface, because that typically depicts misfortune or bad luck.”

New Printing Technology

The need to come up with tailored messages and customized color palettes means that even large direct mail campaigns now actually see a pattern of shorter print runs.

Fortunately, a huge portion of the direct mail production industry has pivoted in recent years toward exactly that type of work — thanks in large part to the introduction of a host of new cutting-edge digital commercial presses from companies such as HP, Kodak, and Xerox.

The new presses not only handle variable data printing — meaning that each page coming off a high-speed press can have different content — but they also incorporate far more colors to enable the use of photo-quality images and graphics in a printed piece.

Not every direct mail campaign aimed at multiculturals needs high-end graphics. But BBCN’s Lee points out that the quality of the printed piece can be a key factor in helping to establish a brand.

“More than 70 percent of Korean-American consumers were born in Korea, and they actually are more digitally advanced than the average U.S. consumer,” Lee says. “So we want to ensure that whatever technology we utilize, including print, is the most cutting edge and has the most pizzazz. That way our brand does not appear to be behind the times or conservative.”

Best Practices

When it comes to marketing to multicultural groups through direct mail, a unanimous piece of advice is that it is essential to be sensitive to the language and cultural nuances of a target segment.

The challenge with direct mail pieces is they have to do a lot of heavy lifting — in some cases not only introducing a brand, but educating a consumer on a new product or service. When it comes to targeting multiculturals, Aetna’s Colon notes that the process can take longer than with the mass market.

“For health care insurance, there’s the generalization that an additional layer of education needs to happen with the Latino population,” Colon says. “The marketing has to be about building trust and empowering consumers so that they not only feel comfortable going to a doctor but also asking questions if they don’t understand something.”

And because direct mail is the perfect platform for a built-in call to action, BBCN’s Lee says it is important to make sure that multicultural consumers are comfortable with the ways they can respond to a direct mail offer.

“We have a bilingual call center as well as a bilingual website, but what we’ve found through our research is that while our customers will do their due diligence online after getting a direct mail offer, they often want to come in for a personal one-on-one for that final transaction,” he says. “So that’s why we include a map with directions to the closest BBCN branch on most of our mail pieces.”

Aetna is intent on continuing to reach Latinos through a number of channels, not in the least direct mail. But, Colon says, that doesn’t mean sending them more direct mail, but rather offering better direct mail programs. “What we are focused on is laser targeting multicultural populations so the effectiveness of the direct mail becomes greater,” he says.

Source

"Know Your Audience." David Ward. ANA Magazine Spotlight. March 2013.

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