The numbers tell the story: The face and wealth of America is changing, and those companies and individuals who are responsive and understand how to penetrate these markets will lead into the future. Consider the following as a business case for finding success in diverse markets.
The U.S. Census Bureau and the U.S. Department of Commerce report that:
- In 1950, 9 out of every 10 Americans were white.
- In 2004, 1 out of every 2.5 Americans was a person of color.
- This number rises to 1 person of color out of every 1.5 Americans for children under the age of 9.
The Selig Center for Economic Growth at the University of Georgia's Terry College of Business reports that:
- The buying power of Hispanics -- now the nation's largest minority group -- will exceed more than $1.2 trillion by 2012.
- Tracking a similar course, the buying power of black Americans is projected to top $1.1 trillion by 2012.
- Asian Americans, representing the third-largest minority group, will see their purchasing power grow almost as fast as Hispanics over the next few years. Asian buying power is forecast to grow 45.9 percent, versus 46.3 percent for Hispanics. In dollars, Asian buying power will rise to $670 billion by 2012.
It doesn't matter which number you choose, they all point to the same conclusion: The growth of minority groups in America is impressive, and it's becoming an increasingly important segment to consumer industries that are looking to tap into minority markets as a source of revenue growth.
So based on the business case, how do you tap these markets? What follows are five strategies that will assist you in prospecting the diverse markets and make it rain commissions and prospects.
Strategy #1: Increase your competence
Many people feel intimidated when approaching the minority community because they are fearful they may say something inappropriate. It is outside of their comfort zone -- and that's OK, because you typically grow most rapidly when you are uncomfortable. It's important to remember that you don't have to be a cultural expert to do business in diverse communities. It's more important that you acknowledge or at least are receptive to the possibility that differences do exist.
You may think minorities will only do business with diverse insurance agents. This is a major assumption that could limit your future growth potential. In various markets around the country, I have sampled diverse professionals on this topic, and unanimously, all said, "As diverse prospects, we would like to have the option to have a diverse professional handle our business, yet at the end of the day, it comes down to competence and performance."
Do you have the competence to provide the best strategies that will enable a diverse person to grow, protect, and transfer generational wealth? Part of your competence may come from learning that this person may be a first-generation wealth creator and that they want to impart on you the obstacles they have overcome to achieve success.
Strategy #2: Partner with targeted nonprofits
One of the best strategies for engaging with the minority community is involvement with nonprofit organizations or business associations that have great social causes. Many of today's firms and sales professionals may become dissatisfied with community-based organizations because they donate money to these organizations yet fail to see any return in the form of business development, employee recruitment, or supplier diversity.
The recommendation I share with companies is to approach these organizations with purpose and be prepared to build trust. Focus on the needs of the organization or group you are sponsoring rather than your individual needs. The diverse organizations are being flooded with requests for referrals to the best and brightest of their constituents, but what must be understood is these organizations are evaluating you to determine if you are trustworthy.
One of the best and least expensive ways to build trust is to donate your time and experience. Perhaps you could use your skills as a marketing professional to help the organization.
For example, if your local Urban League is beginning a fundraising initiative, perhaps you could lead that drive for them. Through fundraising, you could meet board members and prospective clients from diverse markets. While conducting your fundraising, stay focused on helping the organization with their initiative, but follow up with the people you meet with a brief call or note and ask them for a minute of their time.
Some great nonprofit organizations that may provide you with access to prospective clients include Minority Supplier Development Councils, MBA Associations, social organizations such as La Raza, and the Urban League. Churches are also great options because of their need to educate their members and provide a great platform for meeting prospective clients.
Strategy # 3: Focus on business owners
Business owners represent a great marketing opportunity for sales professionals attempting to sell to the diverse markets.
If you have a minority client who owns their own business or is in private practice, ask them if they belong to a professional group focused on minorities or if they know of such groups for your targeted niche. There are such groups available for nearly every profession you can imagine -- accountants, bankers, auto dealers, McDonald's franchisees, hotel owners, doctors, lawyers, and more.
The key to making connections with these groups is relevance. Are you relevant to these groups? Can you help them solve their problems, and can you help them grow their business? In addition, have you built enough trust with your client that they would be willing to introduce you?
Associations will often hold conferences. People attend these events to learn. It's most effective if you keep it simple, such as providing a strategy for building and preserving generational wealth or partnering with a tax attorney to discuss how to legally reduce taxes.
Before the event, you'll want to determine specifically how you will be established as an expert and how you will be positioned as someone who the members should retain for their personal use.
At the conference, request a free booth, hand out materials with your contact information, ask for the attendee contact list, and by all means, network with as many people as possible. You can use your client or the leadership of the group to provide you with personal introductions to be most effective.
Strategy # 4: Joint marketing events
Joint marketing events are another great way to build relationships with your business owner clients, their peers, their suppliers, and their customers. Here's how it works: You each invite your clients to the minority business owner's location for a workshop or cocktail reception. You share the expenses and prospective attendee list and you aggressively market the event.
One advisor I coached implemented this tactic with a boutique clothing store, called the event "Fashion and Finance," and gained a $600,000 client. The business owner was also thrilled because she made multiple sales that evening and reached a new clientele.
Next steps
As with any marketing initiative, the time you spend planning will accelerate your success. Take the time to research your market to uncover the movers and shakers in your targeted community, what organizations they belong to, and what businesses they work for or own.
Phil Wilkins is a certified diversity professional and business coach. He can be reached at phil@philwilkins.com or 480-357-7622.
