Much has been written about the rise of Hispanic consumer purchasing power and how to tap into it �Go spend lots of money� seems to be a favorite. That�s great if you�re selling consumer products like soap or cars, but what about selling, say, an Employee Benefits Program to Hispanic businesses in San Diego County?
Before we begin to answer that, let�s take a look at some Hispanic marketing trends. The late 1980�s saw the rise of Hispanic radio and television. The late 1990�s and dot com boom gave birth to Hispanic horizontal Internet portals. On the heels of these portals came B2C e-commerce sites � many of which were almost identical to their English-only brethren. The focus then, as it is now, was on Hispanic consumers. In 2003 and beyond, more attention will be paid to Latino-owned businesses.
It�s already starting to happen. In January, Office Depot "Recognizing the valuable role of Hispanic businesses in today�s marketplace� announced the launch of its new Spanish-language website � a mirror version of its 14,000 product English-language site. In February, Union Bank announced that it would target the Hispanic market, in part, by �[meeting the financial needs of Hispanics] in a culturally sensitive way."
But it�s not just the Office Depots and Union Banks of the world that can penetrate this market. And you don�t have to spend hundreds of thousands of dollars on a web site or hiring an expensive Advertising Agency or PR firm to do it. Quite the opposite, expensive marketing campaigns may not be the most efficient way to reach the Latino business community.
Unlike the mass market, a more targeted and cost-effective approach is necessary. It requires as much attention to internal operations and core competencies as to the Spanish copy on the marketing slick. The bottom line is that when done right, ethnic product differentiation can be a cost-effective strategy to reach the Latino business community.
First, define the market. There are two million Latino-owned businesses nation-wide, half a million in California and about 35,000 in San Diego County alone. These are the businesses that Office Depot is going after. But for a small, regional player offering an Employee Benefits Program (to continue the example from above) to businesses with, say, 10 or more employees, that firm must know that there are fewer than 2,000 Latino-owned businesses of this size in San Diego County. Depending on a firm�s profile, it also may be helpful to further segment the market by type of business as more granular geo-targeting. It�s also important to analyze Latino-owners� attitudes towards the general category of products or services that a firm provides. Finally, are any competitors addressing this market in a meaningful way? What other analogous initiatives are out there?
Next, research how current and potential Hispanic business owners view specific products, companies and services as they stand today. Without even knowing it, a business may already be doing some things that resonate with Hispanic business owners. A business seeking this market should determine what products it has that may already be a good fit for Latino businesses.
Another consideration is how existing Hispanic employees can help implement a strategy. What can be done for minimal costs and minimal resources? Wherever possible, look for opportunities to �re-purpose� existing company infrastructure, assets and programs. For example, the underlying providers in the employee benefits program example already may have similar initiatives and/or resources that can be leveraged toward a Latino program. In addition, new providers might be added in order to be able to offer, for example, a health insurance program that covers doctor visits or hospitalizations in Mexico.
Use of language is also important. Two-thirds of Hispanics are foreign-born and almost all Latino-owned businesses use Spanish to some degree in their internal business operations. Knowing this, how can you improve customer relationships at critical touch points to be sure that your Spanish-speaking customers are comfortable? For example, you may want to program your voice mail system with a quick link Spanish option �Welcome to Employee Benefits Program Inc., para Espanol marque dos, to speak to an operator press 0, to speak to sales press 1�� No need to make someone who feels more comfortable in Spanish listen to 15 directory options in English before offering them a choice in Spanish.
Once it is time to develop a product or service that meets the needs of a specific market, it is helpful to develop a product vision statement. It should clearly state how the product is different from the competition. For example: �Unlike other employee benefits program providers that offer a one-size fits all approach, EBP Inc. take into consideration the specific needs of Hispnaic business owners and their employees. We do this by �.� The product vision statement will help team members pass the elevator test � the ability to explain the project to someone in less than one minute.
Develop a list of major product features and divide them into those requiring minimal costs and resources and those requiring more costs and more resources. A business that has gotten to this point should begin to analyze how the �new� product would be used by a real customer. What happens inside your organization to get this product used by customers? What are the critical interactions that need to take place with your customer to make this happen?
Now that you have a product that meets the needs of your specific segment of the Latino-owned business market and you have an operational plan, you need a cost-effective way to get it to market. E-mail and the Internet are great marketing tools. They can also be very effective post-purchase, helping to reduce or eliminate the need for hiring additional Spanish-speaking personnel. The San Diego Hispanic Chamber of Commerce is also a great marketing venue. By definition, this Chamber�s members are Latino-owned businesses or members interested in accessing this same market. Look for partnering opportunities with non-competing firms with analogous initiatives. Advertise in the Chamber's Business Referral Directory & Hispanic Market Resource Guide as well as the San Diego Metropolitan and other publications that have Latino-focused content.
Finally, analyze the impact your strategy will have on your company�s value-chain. What are the benefits for your company, customers, partners and channels (current and future) and other stakeholders?
Start developing your corporate strategy to address the Hispanic-owned business market today. Doing so puts you in a position to take advantage of the next wave in Hispanic marketing trends. Ignoring it means giving away business to your competition. Good luck and ¡Buena Suerte!
With offices in the United States and Mexico, Elias Terman and the Terman Consulting Group help companies gain market share in the U.S. Hispanic and Latin American markets.
See his Profile on Experts.com.
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