1400 new South Asians coming into the United States everyday is adding up to 20 million Asians by the end of 2020!
South Asians are the fastest growing ethnic group in the US and every brand is changing its marketing strategy to accommodate this ever growing diaspora segment. By acknowledging that the “World is a global village” while also trusting the power of data and technology allows for a highly personalized and customized marketing experience. At FrontAd Media, we understand that there isn’t a one-size-fits-all marketing approach. Our data-driven engagement begins with aiming for measurable ROI, an important aspect when marketing to a niche segment.
What is Diaspora Marketing?
Diaspora is descended from the Greek word “diaspeirein”, meaning “to scatter, spread about.” When it comes to marketing, diaspora marketing is described as marketing to a segment of people who have scattered away from their homeland with different cultural and geographical backgrounds to settle in places around the world.
Why is Diaspora Marketing important?
Today, we have moved beyond the one-dimensional concept of the aculturalization a.k.a melting pot approach where immigrants modify aspects to their lifestyle and identify to adapt to the host culture to a multidimensional concept that is, a multicultural approach which includes accepting the host culture enough and celebrating the differences and maintaining the cultural distinction.
In a Harvard Business Review article on diaspora marketing, the authors; Nirmalya Kumar and Jan-Benedict E.M. Steenkamp has plotted a matrix to help marketeers in segmenting and targeting the diaspora consumers. By understanding to what extent using the matrix can help us segment and target with altitude scores ranging from -1 to +1 on each dimension.
- Marginals – Purchasing decisions in this consumer segment is primarily driven by affordability, functionality, and durability.
- Ethnic Affirmers – Ethnic affirmers consciously cling to their home cultures and their purchasing decisions are driven by the sense of ethnic identity.
- Assimilators – This consumer segment is highly motivated to purchase the host country’s brands as an affirmation of its culture.
- Biculturals – Biculturals are able to maintain a sense of belongingness to both their home and host cultures. Their purchasing motivation depends on the context and the type of product
Is Diaspora Marketing for your brand?
Using the four crucial questions, we are diving deeper to help brands understand if diaspora marketing is for your brand. As a marketing or brand strategist, answering this question will help you determine how much marketing effort should be invested especially in the South Asian context.
Does the brand have a universal appeal?
The three key metrics for brands to succeed are:
- Country-of-origin effect
If your brand commands a superior product quality, compelling value, and a positive country-of-origin effect, diaspora marketing is the answer to stagnant growth. In taking the example of rice which is a staple food of more than half of the world’s population and for almost all of the immigrant communities in the United States especially seen among the South Asians. Daawat Basmati Rice owned by LT Foods Ltd. isn’t just one of the premium rice brands in India but sold as a premium product with a strong positive country-of-origin effect in the United States.
Is the diaspora large enough?
The diaspora size relative to the local population and the growth of the diaspora is critical. Concentrating in key regions where there is a higher concentration of the specific target audience garner a higher market share and command a high ROI.
Fun fact: Staten Island in New York City is rumored to be the largest home for Sri Lankan people outside of Sri Lanka.
According to the SAALT, South Asian Americans Leading Together nearly 5.4 million South Asians live in the United States. Indians comprise the largest segment, making up over 80% of the total population in the South Asian community, followed by Pakistanis, Bangladeshis, Nepali, Sri Lankans, and Bhutanese. The majority of the South Asian diaspora live in metropolitan cities like New York, Los Angeles, Seattle, and San Francisco. While high concentration can mean high efficiency and higher ROI for the marketing strategy, purchasing patterns and motivations amongst the consumers from micro-cultures of the South Asians will vary greatly. Understanding these intricacies will dictate how digital spending of brands will be most effective. With over 20 years of experience in the South Asian business, we can help you with a customized digital plan which will give you the highest ROI.
Will Diaspora Marketing allow the brand to expand nationally?
Diaspora serves as a stepping stone for brands to go national. The barriers caused by scattered geographical and demographical segments in traditional marketing are broken by digital channels. Taking the example of Himalaya, an FMCG brand with a quintessentially Indian sounding name competes with the likes of Unilever and P&G in India. Himalaya tapped into the surging interest of indigenous and natural products of the West through multiple digital activations. By leveraging the power of Indian Ayurveda and digital advertising, it has established itself as a major FMCG brand in the world including in the US.
Will the diaspora’s socio economic profile help the brand?
Brands can address this question by identifying if the diaspora members’ profile is similar to the target audience in the host country in our case the United States. The average annual earnings of the Indian population in the US is $75000, which far exceeds the U.S average of $46,000.
When an Indian bank, ICICI used diaspora as a beachhead to enter new markets including the United States, Canada, and the UK, where there is a high concentration of Indian Diaspora, the benefits of this approach reflected on ICICI’s books. Foreign operations accounted for 9.7% of ICICI’s revenues of $6.76 billion and 17.6% of total assets of $75 billion for the fiscal year 2013.
South Asian diaspora in the United States
Asian-Americans are the most highly educated and the fastest-growing consumer segment in the United States. Diaspora marketing is complex, but when done right it can help new brands overcome the challenges of gaining a foothold on foreign shores or existing brands tapping a new consumer segment. South Asians will be an indispensable segment for any successful 360 business plan or marketing strategy of brands today.