Signs are pointing to a global recession sparked by the economic impact of the coronavirus pandemic. Lessons from the Great Recession suggest that, amidst recession, spending growth predominantly stems from Multicultural consumers.
We are now more than a month into the new normal of the COVID pandemic. Buying patterns have been massively disrupted, millions have lost their jobs with panic buying affecting many categories while others have nearly collapsed.
When it comes to multicultural segments in particular, a few things stand out. First, culture is a significant determinant of human behavior in this crisis and therefore understanding cultural variation is critical. Who is stocking up more or less? Who is listening to influencers more than news and vice versa? These are questions brands need answers to.
Second, the growth rate of the multicultural population and expenditure in good times is important, but in bad times, that growth rate is critical. From our scenario modeling, we have seen there is virtually no chance of brand growth in a downturn without successfully activating multicultural consumers.
And finally, multicultural influence on the general population only increases every day. For brands, that means that building trust and cultural relevance with these segments creates cross-over effects that drive demand across all segments, especially younger white segments.
To successfully address the challenges and take advantage of the opportunities, brands need to understand how culture is intersecting with the current climate to alter attitudes, behaviors, and receptivity to support and outreach.
With this end in mind, Collage Group fielded a study during the last week of March to provide members insights into the attitudes and behaviors of different cultural groups—racial, ethnic, and generational segments—during this time of crisis and uncertainty. We covered attitudes, COVID mitigation behaviors, employment and finances, buying patterns, time spend, general behaviors and expected future behaviors.
Read below for four top findings from the research.
- Most people recognize the seriousness of the disease and don’t need to be scared into action.
- Avoid alarmist messaging. Remain fact-based and compassionate. Messaging should recognize that people are doing what they can, but can do even more to ensure success.
- Hispanic consumers are overwhelmingly feeling the economic impact. And Millennials—a group that has already experienced significant economic hardships due to student loans and the Great Recession—are bracing for more disappointment.
- Tell consumers how your brand will support them during these hard times. Offer coupons, extended free trials, etc. Let them know that you know they’re struggling. This is the time to build connections and trust that can last for years.
- Black consumers are more likely than other groups to have bought more food, beverages, personal goods and household goods since the start of the pandemic.
- Understand which segments are changing behavior; who to target right now is as important as how to market.
- Everyone is spending more time on social media and streaming platforms, but this amplifies the differences in information people receive. Note that younger consumers, especially younger multicultural consumers use different channels for getting information, relying more on influencers than the news.
- Build a culturally fluent channel strategy. More than ever, brands need to show up in the places where segments retreat into their preferred media bubbles.
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