IQ Analysis: Missing the Target

As Ethnic Sites Boom, Marketers Are Still Aiming Elsewhere.
Suppose you’re Procter & Gamble and you’re looking to advertise Sure antiperspirant on the Web. Your media plan might include key words ranging from “weather” to “health clubs,” or rich media banners on major portals. Or a targeted campaign aimed at parents on the new African American site that could deliver a captive audience, as the company’s recent media buy indicates.
But online buys targeted to minority audiences are still the exception rather than the rule. Many advertisers use a one-message-fits-all approach even when targeting Internet users of different ethnicities, while others don’t address the populations at all. It’s quite an irony for a medium in which narrowcasting essentially makes every market a minority. Still, ethnic markets are audiences that online advertisers can’t afford to ignore.
“The opportunity to market to people’s family and cultural and ethnic motivation is something we’ve just scratched the surface of,” says Don DePalma, principal analyst at Cambridge, Mass.-based Forrester Research.
Online consumers, he says, are already buying products from around the world. But marketing more specifically, such as promoting a locally used credit card on a locally-focused site, can boost sales more than the same message received by what he describes as the “white bread, non-ethnic American.” Forrester predicts the development of more ethnic portals from expatriates who retain ties to the motherland, Americans who opt out of using English as their primary language, and residents of emerging Internet markets.
Online advertisers have a history of being slow to adjust to shifting online demographics. It took several years before ad spending on women-focused sites caught up with the number of women online.
As with the women’s market, the number of ethnically-focused sites is broadening. According to Forrester, foreign sites include: Universo Online (, the largest Brazilian portal;, which targets the 60 million Chinese who live outside China and Taiwan; English-language site IndiaWorld at; South Africa’s Anazi search site at; and Russian portal
But the sites aren’t used optimally either globally or domestically. “I think the ethnic populations in America have been vastly under [marketed] to by the computer industry and high-tech industry,” says Al Schreiber, managing partner of True North Communications’ New America Strategies Group, New York. Citing the report “The Buying Power of Black America” by Ken Smikle, president of Target Market News, he notes that high-tech purchases have increased five-fold since 1993, and for every dollar white American families are spending for online services, African Americans are spending double.
With the rise in affluence and sheer growth of the populations, Schreiber says, technology companies have a prime audience in minorities. “Frankly, for a lot of people, this is counter-intuitive,” he says. “They don’t know that it’s happening.”
But the Internet’s community attributes are exactly why it attracts minorities, he says. “What’s fascinating to me is that one of the real hallmarks or essences of the multicultural consumer is networking” through professional, civic and church groups, he says. Plus, he believes some minority markets may have a better experience doing such things as shopping online than they might offline. “The equality that’s inherent on the Internet is certainly very appealing to people of color,” he continues.
Lawrence Tuckett, director of ethnic marketing for TPI, a division of New York agency Interactive8 (which also works closely with the New America Strategies Group) expects two industries in particular to focus heavily on the African American market this year: Pharmaceutical companies and financial institutions.
Drug companies can access communities with common health problems, such as high blood pressure, Tuckett says, and financial institutions can serve the growing number of African American business owners.
“I think people are understanding there’s a shift in demographics in this country,” Tuckett says, noting a Nielsen Media Research statistic that 24 percent of African Americans are on the Internet. That penetration almost matches the U.S. Internet market as a whole, which according to Jupiter Communications, New York, was at 28.4 percent in 1998. “We’re moving more toward a minority majority,” Tuckett observes.
Though the market is underserved, some major advertisers are catching on. Cox Interactive Media’s, which launched two weeks ago, already has advertisers including P&G and insurer/asset manager AXA/Equitable. John Pembroke, brand manager of the Atlanta-based site explains its potential appeal: “We are after advertisers who want to reach the audience that we will deliver: affluent African Americans,” he says.
The Hispanic market offerings include LatinoLink, a Spanish-English site with news, analysis and commentary, and Asociados Hispanos, a Spanish language site providing news, sports, weather, entertainment and media links to all Spanish speaking countries. The newest company to make a foray into the U.S. market is New York’s StarMedia Network. Armed with $80 million in private financing, the network services Latin American countries in Spanish and Portuguese and launched in the U.S. in November. According to the company, Internet use among U.S. Hispanics rose 650 percent over the past four years to 4.5 million users, while the Latin online audience outside the U.S. grew to 10 million.
“It’s an opportunity for us to offer a U.S.-level growth Internet product, but completely in Spanish, with a high degree [of] reach,” says Fernando Espuelas, chairman and CEO of StarMedia Network. The site has about 150 advertisers, including Ford, Chrysler, General Motors, Intercontinental Hotels and Lufthansa.
Ad services supporting the market are starting to spring up. For instance, Woodland Hills, Calif.-based advertising rep 2Can Media created Grupo NetFuerza in November, dedicated exclusively to reaching the Hispanic market. It now represents 13 sites, including LatinoLink, Asociados Hispanos, soccer network Futebol Total and financial site Zona Financiera.
“There was a whole universe out there that was not taken advantage of,” says Grupo NetFuerza director of advertising Stan Levinson.
The potential for advertising and commerce in the coming years is great. As New America Strategies’ Schreiber notes, “You get the feeling that this is a sleeping giant.”
Advertisers who snooze may lose.
A sampling of non-American-focused Web sites
– Spanish and Portugese-language StarMedia Network (, which launched in the U.S. in November
– Universo Online (, the largest portal servicing Brazilians
–, which targets the approximately 60 million ethnic Chinese who live outside China and Taiwan
– English-language IndiaWorld (, which promotes itself as “all the India you want to know.”
– South Africa’s Anazi search site ( Its slogan is “We stay South African.”
– Russian portal

Source: Forrester Research