Very interesting article from Patricia Graham, Executive Vice President and Chief Marketing Officer of Knowledge Networks.
by Claudia Havi Goffan
A close look at how Cultural Differences impact Customer Acquisition and Retention Strategies.
When I arrived to the U.S., 18 years ago, I opened a checking Account with Bank of America. It was obvious. The name, Bank of America, carried in it a familiarity that no other bank did. I, too, was born in America, the continent of America. What people do not know is that in Latin American schools teach you that America is a single continent divided into three parts, North, Central and South America. This is the reason that you may have heard Latinos say: “we are American too.” Back to my story, Bank of America, one; other banks, zero.
A few months later, and having maintained what I thought was an excellent relationship with the bank, I decided to fill out an application for a credit card, “the Bank of America VISA.” After three long weeks, I received a letter stating that my application had been denied without a reason given. I got really upset and went to the bank to let hell loose. I had been a wonderful customer and had more than enough money in my account—and they knew it- in order to respond to whatever spending limit they could give me. The answer was: “You need to call Visa, we (Bank of America) don’t have anything to do with this.” I immediately called Visa and was told that my request had been denied because I didn’t exist. “Didn’t exist? But here I am, I exist,” was my response with utter disbelief. The lady explained that I didn’t have a credit history. Until then, I never knew a credit history existed. No such concept existed in my home country where people purchase a home with cash and they don’t pay their bills with checks, as they will get “lost” in the mail (but that’s a different story and the beginning of more cultural differences). In the end, I realized that I wasn’t going to get my credit card with Bank of America or VISA. What a disappointment. And, what an insult to tell me I didn’t exist.
I decided to fill out an application with American Express. Two weeks later, a person from American Express called me at home and wanted to know why they couldn’t find any credit history on me. Now, that’s service! I told her I had lived in the U.S. for just a few months. She replied: “Perfectly understandable. You will receive your card in the mail within 2 weeks.” Needless to say, I never forgot my experience with VISA or with American Express. I have been a loyal customer of American Express since 1991, always preferring to use my AMEX to any other credit card.
Lesson to be learned: Listen to your customers. Cultural differences may be found where you least expect them. You may get lucky the first time, the second time around, you’d better know what you are doing.
A bit of background on the Latin American financial system
The concept of a credit history was introduced only a few years ago in Latin American countries.
There are financial infrastructure obstacles common to the Latin American region, such as uneven income distribution, low penetration of the banking system, low computer usage, and very famous “informal” economies that function only in cash. Remittances from family members abroad only increase the number of cash transactions.
The banking crisis of Argentina, Brazil, Chile, Colombia, Mexico and Venezuela in the late 1990s enabled a large financial reform and the modernization of the financial infrastructure. One of the changes was the adoption of credit history.
Thought of the day
by Claudia Havi Goffan
Hispanic Advertising is about connecting with the U.S. Hispanic Consumer and their real-life experiences and, sometimes, it is simpler than imagined. Learn how Oreo reached the Hispanic Consumer with this outstanding campaign.
It features a dad, a child, an Oreo cookie with the caption: “Dad learns to eat Oreos from me.”
Hispanic children, either born in the U.S. or abroad, are exposed to many experiences that their non- or semi-acculturated parents may never experience, unless it’s through them. So, how do you think a Hispanic dad will learn to eat an Oreo the American way?
That’s why this ad works. There are no stereotypes. There is only a human truth.
Quote of the Day
By Havi Claudia Goffan
TL: Tell us about your professional life before launching Bodas USA Magazine.
Lilian: I was working as a senior reporter for La Opinion, the Spanish-language daily from Los Angeles, writing mostly for the front page. Most of the stories I covered were the political and immigration beat as well as human rights stories. Therefore, when I left the paper to launch Bodas USA La Revista, I made a huge transition from covering the breaking news of the day to launching the first Spanish-language bridal magazine in the United States
TL: We know you are a philanthropist and strong supporter of the Latino community. Can you tell us about those initiatives?
Lilian: I think it is very important to give back to the communities we live in. As a full-time journalist I spent a lot of time in the newsroom or gathering the news, that I never had the time to get involved in community organizations or in human rights causes as I do now. Having covered human rights abuses for many years—the anti-immigration movement, the plight of undocumented worker, women and children and legal resident discrimination—I felt those issues close at heart. Before, when I was working for La Opinion, I had to be objective and include both sides of the story, even if it meant interviewing a member of the KKK. Now, I feel very fortunate to be able to participate as a volunteer in the Orange County Human Relations Council as part of their Marketing and PR Committee. It is very fulfilling to actually be able to take a stand and contribute to fostering a better understanding of ethnic groups. This organization produces an annual hate crime report that brings to light and keeps track of hate crime incidents, thus helping to reduce the numbers.
I’m also a Board Member of the National Hispanic Business Women Association (NHBWA) that recently awarded educational scholarships to 16 college students from all parts of California. It felt so good to be part of that event and be able to contribute somewhat to their higher education goals. That is why I’m donating parts of the profits of the magazine to the NHBWA Scholarship Fund.
Our honorary board members are made of Top Latinas from Southern CA, like Maria Lourdes Sobrino, CEO of Lulu’s Desserts, who made history in the United States in her industry by being the first one to introduce ready to eat gelatins, many years before Jello launched their products into the same market. So, it is very exciting to be part of an organization where everybody is so willing to share resources, contacts and know-how. They have been a tremendous support in the launch of Bodas USA La Revista and share with me the success of the magazine.
TL: How did you come up with the idea for the Bodas USA magazine?
Lilian: I was assigned by Nuestra Gente Magazine a story on Latino weddings in the U.S. back in 2000. I was shocked back then by the lack of websites, magazines or other resources in Spanish online and print content for U.S. Latinos; there are many wedding sites and wedding magazines in Spanish but they are from Latin America and Mexico and cater towards the upper middle class. I felt a total disconnection from their stories having grown up in the United States, so I decided to register the website name and started working on concept, research, demographics. It took seven years of dating this idea, but finally we wed!
TL: Was it hard to implement? Did you encounter any obstacles?
Lilian: Yes, it was hard to implement. From conception to implementation it took seven years, because I didn’t have the courage to resign a prestigious job. I graduated with a degree in Political Science, so working for La Opinion and covering political stories was a dream come true. But in the end, I felt the need to explore other areas such as publishing a magazine.
In the two years of the start-up, I encountered every possible obstacle. I have quickly learned from my mistakes and moved ahead, and learned not to waste time dwelling on those obstacles, because time is precious for an entrepreneur.
Financing was an obstacle too. It takes a lot of money to launch and print a magazine.
TL: What is your method to dealing with bumps on the road?
Lilian: I have had and continue to have bumps on the road. I think a business is much like life itself, not perfect. Yes, there are days when everything is great and others when things don’t happen as expected. I concentrate on the positive aspects and the many accomplishments our new publishing company is having.
I do a lot of meditation and constantly remind myself of the rapid success the magazine is having with only two issues under our belt. Thus, all the bumps and obstacles become little bumps and little obstacles.
TL: To what do you attribute the success of your magazine? Is there a formula or advice you can give us?
Lilian: I attribute the success of the magazine to a combination of factors:
1- Filling a market need
2- Top editorial quality
3- Implementation of a multi-media approach: we are trying to close the digital divide and therefore, we also have a digital issue that is growing in popularity, given that Latinos are spending more time online. We also have how-to videos, podcasts and will be launching a TV pilot in the Fall of 2008.
This July we are launching the first phase of our new-redesigned website that includes magazine content, as well as special content for the site.
4- Written with a cultural perspective: takes into account the differences of Latinos from different countries. For example, the Summer Issue features a traditional wedding cookie and cake recipe from Mexico, and one from Costa Rica. We are featuring Latinos from many countries.
5- Up to date on trends
6- We are featuring Latino weddings like nobody else has done it before: we shed a light on this important consumer. We also feature weddings of successful Latinos.
7- Instilling a sense of pride in our editorial team that translates into our readers: the feedback is tremendously positive, they have literally thanked us for putting together a magazine about Latino weddings.
8- Positive Hispanic media coverage: we have radio stations in New York, Miami, Texas and Los Angeles talking about the magazine. We have been on the national Spanish TV networks. Mainstream media is learning about us. NPR’s Marketplace, PR Week and radio host Hugh Hewitt have done stories on our publication.
TL: Tell us about Bodas USA: What does it feature? Where can people purchase the magazine? Can they read it online?
Lilian: Our Summer issue 2008 (second issue) is available at select Barnes & Noble stores nationwide, about 180 of them, as well as major Hispanic supermarket chains in CA, TX, NV, FL, and in New York and other parts of the East Coast as well as in Baja California, Mexico. Cover prices of the 160 page magazine is $4.99. We have digital editions available via our website http://www.bodasusa.com/
The Summer issue 2008 features Mexican dress designers, famous Latino weddings, fashion, nutrition, music, Latino wedding photographers, Green weddings, travel and honeymoon destinations, a bridal gown gallery and many more.
TL: Companies are always looking for more targeted media venues. What can you tell them about Bodas USA target market?
Lilian: Our target market is Bilingual and Spanish-dominant Latinas 18-34 age cohorts. Just in CA by the year 2010, the 18-34 age cohorts will be 10 million powerful.
The weddings that we hav
e featured in our two issues, demonstrate clearly that there are no expenses spared when it comes to Latino weddings.
Our target market is nationwide; we have web visitors from all parts of the U.S., made-up of affluent Latinos.
Also, please keep in mind that mothers are an important consumer: they will purchase the magazine for their daughters that are soon to wed; and they too, are willing to spend big on the preparations for the wedding.
We are featuring high-end weddings in every issue, but also cover the weddings of Latinos who on average spend more than $30,000 if not more, on their weddings.
We will target the brides to be directly at major bridal shows in Southern CA, Northern CA, Florida, Texas and Mexico.
TL: What companies would benefit from advertising in your magazine? And how would they be most successful in reaching your core audience?
Lilian: There are a huge number of companies that can benefit from advertising in our publication; they will get their ad exposed directly to the bride to be via the print issue, digital issue and our website.
Companies that can benefit from advertising with us come from all areas of the wedding industry, such as catering, photography services, invitations, spas, beauty salons, bridal shops, bridal online shops, accessories, favors, travel, beauty products, hygiene products, home products, furniture, tourist sites, honeymoon destinations, cruise lines, flower shops, etc.
Our core audience is becoming more dependent on technology, so we encourage advertisers to showcase their ads in our print issue as well as our website for added value and a higher ROI.
We also recommend, if you don’t have an ad in Spanish, create one, it is better to reach your target audience in their language. We also accept bilingual ads.
We make exceptions to accepting English only ads when the message is very clear, regardless of language.
TL: What are your plans for the future, personally and professionally?
Lilian: Professionally to establish media partnerships that will help us catapult our publication nationally and internationally and establish a successful distribution system of Bodas USA La Revista in major departments stores like Target and Wal-Mart.
Our publishing company has been commissioned to put together a custom-publication for a major Boxing event taking place on July 26 at the MGM Grand in Las Vegas. We hope to secure other contracts for future sports publications in the U.S. as we are already publishing Boxeo La Revista in Mexico.
Personally, to continue to grow as a human being and to enjoy being a publisher, entrepreneur, a mom, a daughter, a wife, a sister, a friend and a dog owner.
TL: In conclusion, what is the single most important marketing or media message you can give us?
Lilian: Advertisers need to be aware that the Hispanic consumer is very different than mainstream consumers. Hispanics are very loyal to brands, so that is a plus for them, but they need to reach them with culturally sensitive messages that are targeted taking into account their language and their culture.
Also, the number of Latina women-owned businesses in the U.S. has grown dramatically over the past few years and companies need to understand that this group of women has a tremendous purchasing power. For the professional Latinas that have not wed, when the times comes, they will “throw the house out the window” or again leave no expenses spared.
Latinos that are acculturated still incorporate many cultural elements into their wedding, so culture and language continues to play a major role in newer generations who will not dare for example, have a wedding without Latin music or leave out some traditions as part of their big day.
For example, my niece which is the first generation of US-born Latinos in my family is having her wedding on July 12, she is a college student, a professional Latina a business owner and soon to graduate from a four year college with a Teaching Credential, yet her wedding is the typical Latino Mexican wedding of the newer generations, she will have the DJ, but also Mariachis and, of course, a million bridesmaids, but she is making sure the decorations and the reception site look like magazine material taken out of Bodas USA La Revista, which by the way inspired her to tie the knot, because like many professional Latinas she is going out of her way to have her dream wedding, even if she (and her parents!) is going in debt for a while.
She is the perfect example of my target audience; she is 23 years old, talented, professional, business-owner and relies on Spanish- language magazine content -even though she is bilingual- for planning her wedding, in this case Bodas USA La Revista. The reason: we speak her language and understand her culture and she can see herself reflected in the many Latinas whose weddings we feature.
That is our Motto. Your Language, Your Culture, Your Wedding.
Bodas USA La Revista
We are fortunate the Hispanic wedding industry is recession free!
Let’s talk segmentation – Part I
by Claudia Goffan CEO of Target Latino
Graphics by Jim Perez
Hispanic Market Segmentation:
The reasons behind the use of acculturation levels in Hispanic Marketing. Hispanic Market segments and projected size by Claudia Goffan, CEO of Target Latino.
Why levels of acculturation?
- In the 1900’s European immigrants would force their children to forget about the customs of the “old world” and “just be” Americans – this was a process of assimilation
- To acculturate means to incorporate or acquire a new culture without foregoing another one
- Hispanics do not “assimilate”, they “acculturate”. They do not let go of customs and/or language
Facts about Hispanic Market Segmentation
The three segments by Acculturation Levels
- Non-Acculturated: Persons that only navigate within the Latino culture. Most of them have recently immigrated to the U.S. and prefer to speak Spanish
- Acculturated: Persons born in the U.S. of Hispanic descent. They prefer to speak English and can navigate into the Latino culture
- Semi-Acculturated: People that can navigate in both cultures.
What factors get them from one segment to the next?
- Fully-Acculturated: Hispanics are proud of their culture and parents will tend to teach their U.S.-born children the customs of their ancestors
- Non-Acculturated: Hispanics born outside of the U.S. can only navigate from non-acculturation to semi-acculturation. The speed at which this will take place depends on these three major factors:
–Socio economic status in country of origin
How fast will the market acculturate?
The speed at which this will take place depends on these three major factors:
- Time: the longer they live in the US, the longer they are exposed to a new culture and are able to incorporate it into their everyday lives
- Education: the higher their education level, the easier the understanding of another culture will be
- Socio economic status in country of origin: the higher the socio economic status they enjoyed in their country of origin, the higher the likelihood that they have been exposed to other cultures, thus enabling a faster and smoother transition
Here are some examples of acculturation levels and speed:
- My brother was born in Buenos Aires, Argentina -30 years old at the time-, highly educated -a lawyer-, seasoned international traveler and with 6 years of English studies from the London Cultural Institute under his belt. He was visiting me in Los Angeles.
On the second day of his visit, I arrived home to find him holding a box of sugar and laughing so hard he was in tears. He kept on saying, “soy un sudaca (I am so third world).” I didn’t understand what he was talking about at first, so I waited for him to calm down. When he did, he explained to me that he had ripped the top of the box open in order to reach the sugar at which time he realized that there was a pouring spout on its side.As you can see, it took him just a few minutes to “acculturate”, that is, to learn to navigate in the American culture (at least a little bit).
- A friend of mine took a little longer to acculturate. She is also very well educated -a dentist- and a world traveler, but is older than my brother and understands very little English. Apparently she had bought a brand of laundry detergent at the supermarket to wash a sweatshirt I had given her. After washing it, she remarked that the sweatshirt was of low quality, because it had faded so badly. I was puzzled, but soon forgot about it.When she returned back to her country, she left the “detergent” with me. I immediately noticed that it wasn’t detergent at all, it was “bleach.” She had mistaken a product type for a brand. No wonder the blue sweatshirt had faded.In order to acculturate she had to be told about her mistake. You can bet she never did that again.
- Latino banks spend more than a year teaching its underserved Hispanic customers how to use the ATM machines. The reason is that most of their customers have never used one. The bank is acculturating them into American society.
Differentiating Characteristics between segments – Hispanic Market Segmentation
Hispanic Market Size
- Population: 42.7 million as of July 1, 2005 or 14 percent of the nation’s total population. (This estimate does not include the 3.9 million residents of Puerto Rico.)
- 102.6 million – The projected Hispanic population as of July 1, 2050 or 24 percent of the nation’s total population on that date.
-Source: Census data
- We need to be aware that in this market there is about a 40% to 50% undercount
Hispanic Market Size by Acculturation Levels Segment
By Havi Goffan, CEO of Target Latino
Like one of my good teachers once said, “would you ask the janitor to develop your marketing strategy?” Well then, why would you ask your call center representative to create and translate your Spanish collateral materials?
How many times do managers find themselves in the position of having to hire an employee—be it for a call center, sales or marketing—and didn’t know how to go about it?
Here are some tips on how to hire the “right” Hispanic expertise
If you are looking for a call center representative, you need to find a person with a customer centric attitude and bilingual skills. Ah, but this is tougher than it sounds. The customer service skills are easily detectable, but how do you test the prospect’s bilingual skills in a language you do not know? My advice is to have them take a proficiency test at a local branch of a language instruction institute or a reputable foreign organization that tests Spanish language skills.
Maybe you are looking to fill a junior marketing position and you want to make sure you hire the best asset for your company. You will have to do a little research first. If the position requires a degree and your candidate’s diploma is from a foreign country, find out if the school is a reputable one for the year of graduation. You will find that many Latin American countries have better public universities than private ones. Only the brightest students are able to pass the public university tests and graduate. Some years (the economy and politics of that country have a lot to do with this) may see the best and most prepared candidates graduate. Some years might not be as good. Another nice fact to know is that most Latin American universities do not have electives or specialization in any specific area until graduation. You must look into their post-graduate studies for special skills.
To hire a senior executive position, I would strongly advice the use of an experienced recruiter that understands your expectations. Most companies believe that bringing one or two top Hispanic gurus will achieve the goal of acquiring the Hispanic market. In reality, you need to hire an executive that will also build you a good team. You must be ready and able to support his or her resources and staffing needs.
How do you find a reputable recruiter? Once again, a little research is needed. Check credentials—talk to other hiring managers—treat it as if it were a future “hire.” Make sure the recruiter specializes in “Hispanic” and works with the type of candidates you are looking for. Do not embark in a venture with a recruiter that specializes in call center staffing to find either your Director of Hispanic Marketing or a Hispanic member for your board.
If all this seems overwhelming, you may want to hire a consulting firm that can find you the right recruiter, the perfect candidates and can also assist you in developing your Hispanic marketing strategy.
Photo credit: Jessica Rebelo Design