NEW YORK: Well-known brands are continuing with multicultural outreach during the economic downturn, keeping many firms busy working and pitching throughout the first quarter. Companies like Coca-Cola, General Mills, and State Farm recently launched campaigns targeting the Hispanic community, showing their support for multicultural outreach.
State Farm Insurance reported that from 2007 to 2008, its multicultural outreach increased 50%, and it plans to continue such outreach.
“Certainly, we do feel some effects of the recession,” said Ed Gold, advertising director for State Farm, who works closely with the PR team. “The multicultural markets are extremely important to us, and they are definitely not an area where we are looking to make any cutbacks.” State Farm was the title sponsor for the Billboard Latin Music Awards on April 23.
“Statistics show that there is growth in affluence and buying power among multicultural audiences,” said Lori George Billingsley, director of community and multicultural communications for Coca-Cola North America, as well as a columnist for PRWeek, in an e-mail. “So, while company's dollars are shrinking and budgets are tightening, targeting multicultural audiences is an area where growth can be realized.”
Agencies are also benefitting. Edelman reported that its multicultural team nationwide has taken part in an average of 12 RFPs per month so far in 2009, and reported a growth rate of about 15%.
“We've seen a steady flow, probably more than I anticipated given the overall environment that we're in,” said Latraviette Smith, VP of corporate marketing for Edelman and national VP for multicultural.
“Despite the economic climate, we have seen more new business opportunities in [Q1] 2009 than I've ever seen [in a similar period] in my 18 years running the business,” added Kim Hunter, president and CEO of Lagrant Communications, which specializes in reaching black and Hispanic audiences. Lagrant participated in 10 or 11 new business pitches so far in 2009, he said.
“Companies are always looking for the advantage, the leg up, the new opportunity that [will] give them a new proven revenue stream,” said Armando Azarloza, president of the Axis Agency, the multicultural agency within Weber Shandwick. “We can provide companies a pretty good [ROI], and they are looking at that as they are keeping an eye on their bottom lines.”
Azarloza said Axis participated in 10 RFPs so far in 2009, both on its own and partnering with WS or other IPG companies.
Chicago-based Flowers Communications Group is seeing equal growth in Hispanic- and African-American communications, according to SVP and MD Rashada Whitehead. The firm has taken part in about six formal RFPs so far in 2009, and pitched several more clients via less formal means.
“We're working on an RFP virtually every week of this year so far,” said Mike Valdes-Fauli, MD of the New York office of The Jeffrey Group, which often partners with larger firms, such as Waggener Edstrom, APCO, and MWW Group, to pitch for integrated RFPs.
And while many companies are taking a hard look at all of their marketing spend during the recession, those in multicultural know how to work a small budget.
“The good thing is that we've been accustomed to do more with less,” said Edelman VP Audrey Ponzio of multicultural budgets. “While the investment isn't necessarily going to mirror the general market spend, [with] a significant dedication to... Hispanics or African Americans, you are going to see a lift.”
And the growing Hispanic population, in particular, translates into an attractive opportunity for multicultural PR.
“The Hispanic market is definitely a growth market here in the US,” said State Farm's Gold. “We feel that [we are] the leading auto and home insurer in the country and... we need to make sure that we are the leading auto and home insurer to the Hispanic market now and in the future.”