HOW SEGMENTATION CAN PERPETUATE SEGREGATION

With African American purchasing power rivaling that of the entire nation of Mexico (1.1 vs. 1.28 trillion USD respectively) and Hispanics driving most of the growth for CPG brands*, the temptation to see them as markets is irresistible. 

Many brands have thus defined minorities as their primary or secondary target. The universal formula applies: create a message relevant to this audience and place it where they are more likely to see it. 

The problem arises when ethnicity is considered a defining characteristic of your audience: brands literally end up creating “black” ads and put them in “black” zip codes. In 2013 alone this was done at the tune of $2.6 billion dollars*. Now multiply this by dozens of years and the implications of this practice become apparent:

“BLACK MEDIAN HOUSEHOLD INCOME REMAINS 59% THAT OF WHITES, A RATIO ESSENTIALLY UNCHANGED SINCE 1967 WHEN THE CENSUS BUREAU BEGAN TRACKING THIS DATA.”

Shaping culture: by constantly reminding an ethnic group of codes that set them apart from others (technically how they over-index in certain metrics), stereotypes are reinforced and ethnic enclaves perpetuated. In other words: this is how you are supposed to behave and this is where you are supposed to live. Deviation from those expectations is often met with accusations of “acting white”, discouraging progress and crosspollination.

Reducing potential: building your message around the color of your audience necessarily limits its appeal to that group, negating other, critical dimensions of the human experience.

There’s no denying that ethnicity is an important consideration. The question is what to do with it. Consider the divergent fortunes of Jesse Jackson and Barack Obama. The Black experience has shaped the lives and views of both politicians. But while one has made it a limiting aspect of his message, the other used his community’s desire for Change as a rallying cry that viscerally resonated with a much larger group, allowing each voter to interpret that aspiration as most relevant to themselves.
As a result, one failed twice to secure his party’s nomination, the other was elected President, twice.

We call Mr Jackson’s approach Black/In: a message defined and limited by the color of its audience.

Remarkably, millions of advertising dollars are still spent this way by marketers anxious to tick the ethnic marketing box, while their ethnic agencies prosper with this short-sighted strategy that limits success and contributes to perpetuating our social ills.

Working with both the Hispanic and African American “markets’” at Chaco we learned the advantages of a Black/Out approach: a message informed but not limited by the ethnic experience. It isn’t only more socially responsible, it is also more profitable. Just ask Pharrell.

Chaco Papers are executive summaries of extensive research conducted to inform our work for various projects. If you would like to learn more about this or any other Paper contact papers@chaco.cc. 
*this data Nielsen 2014