Diversity marketing can pay big dividends

It’s a fact: The face of America is changing. Demographic experts say that by the year 2050, the number of nonwhites in the United States will have significantly increased—in turn, so will their purchasing power as consumers.

 It’s called “diversity,” and it is likely to change the way you do business in the coming years and decades. To adapt to a new “hue,” many garden center owners are introducing a variety of diversity awareness and management programs for the benefit of their employees and customers. In the process, they are discovering that keeping an eye on diversity is more than just good business – it is a strategy that could make or break the company’s future.

The stat sheet. Demographic studies on diversity are fluent in the language of statistics. For example, the latest report from the U.S. Census Bureau (Aug. 14, 2008) notes that as of 2008, nonwhites now make up roughly one-third of the population. In this group, 15 percent are Hispanic, 14 percent are African-American, around 5 percent are Asian, and another smattering is composed of Native Americans.

 By 2050, the U.S. Census Bureau predicts, nonwhites will become the majority, making up 54 percent of the population. The number of Hispanics is projected to nearly triple, accounting for roughly one out of three U.S. residents. The black population is projected to increase less dramatically; still, African Americans will likely represent 15 percent of the population. Over the next four decades, the number of Asians is expected to almost double and comprise 9.2 percent of the total, while the number of Native Americans also will nearly double, to 2 percent. 

Meanwhile, as the United States changes its colors, it’s also aging. According to U.S. Census Bureau statistics, 38.7 percent of the country’s population in 2008 was 65 and older. And now, as the aptly named Baby Boomer generation reaches its twilight years, the “seniors” group is likely to more than double in size by 2050, to 88.5 million.

 So, what’s the game plan?  “It’s a strategic imperative to understand the changing nature of your customer base,” said Jarik Conrad, Ph.D., human diversity consultant and president of Conrad Consulting Group, in Jacksonville, Fla., and author of “The Fragile Mind,” which explores race relations. Conrad said that when you respond to the ethnicities, ages, sexual orientations, physical challenges and other differences among your existing customers – and reach out to new markets that reflect this diversity – you likely gain business you might never have attracted before. 

“People like to buy from businesses that they believe care about them,” Conrad said. Likewise, they frequently shop businesses that can relate to them. Conrad said there are several ways a retailer can improve the way his store values and manages expressions of diversity:

* Recognize and respect the ethnic, cultural and other differences of your customers.

* Target your marketing strategy, products and services toward diverse populations.

* Reach out to these populations and respond to their needs and purchasing preferences.

* Allow for and respond to the ethnic and other differences among your employees, and treat everyone on staff with equal fairness.

* Encourage discussions with your managers and supervisors on diversity issues as they relate to the concerns of your employees and customers.

* Invite open channels of communication between staff of all ethnicities, ages, physical abilities and both genders.
The bottom line, per Conrad : Diversity isn’t an issue to ignore. In fact, it should be an asset that garden center owners maximize to assure a competitive stance in the marketplace.

Repositioning your target. “The changing demographics afford retailers a great opportunity to increase market penetration and sales,” said Tom Nesby, president of Nesby & Associates, Inc., a Renton, Washington-based, national management consulting firm. “The better your ability to flex your marketing and selling strategies to various ethnic groups, the greater [are] your chances to penetrate new markets.”

For garden center operators, this means changing some parts of the long-time business plan. For instance, businesses known as good places to work for nonwhites (and whites), older people and the physically challenged are sought out by these same individuals. If you want the largest customer base and best talent among your staff, value and draw from the diversity that’s out there.

Nesby said you could realize immediate benefits. For example, when your marketing, advertising and promotional efforts speak to Hispanics, Asians, blacks and other ethnicities and people of color, as well as the elderly and the physically challenged, you’re more likely to attract them to your garden center. There are other notable potential gains, as well: 

* More economical merchandising – When you become familiar with your customers’ product preferences, you’ll carry the merchandise they really want (pepper plants for Hispanics or daikon seeds for Asians) – not what you think they want – thereby  avoiding overstocks and unnecessary markdowns.

* Better customer service – When you understand the differences in people from a variety of ethnic backgrounds, and ages, you can better communicate with them on their terms, and serve their needs as customers. You might, for example, learn greetings in their first language or know when/how to mark a particular culture’s holidays.

* Better company management – When all personnel at your garden center (from upper management to warehouse staff) gather regularly to discuss diversity issues, you demonstrate cohesiveness from the top down, thereby reaching all corners of your business.

* Improved employee productivity – When you understand, accept and encourage diversity among your staff members (everything from their cultural backgrounds to their lifestyle choices), they feel valued, and free to think and work creatively, and are more likely to do better work.

Managing diversity. Diversity management begins with you, as the owner or manager of your garden center, and with your top-level personnel. Smart business owners share several common practices. Discussing diversity issues with staff is a way to become better aware of the challenges, solutions and opportunities. Often, your employees know best what they and customers need. Another sound move is researching the demographic mix of your market. Seek help from your local chamber of commerce and from customer surveys to learn how to better accommodate consumer and workplace needs.

You can also ask some questions that need honest answers, For example, do your marketing plans, products and services meet the diverse needs of your regular shoppers? Does your advertising include faces/products/services representative of the customers who are in your market? Do you have a plan that offers a menu of benefits, such as flexible work schedules for employees, child care and paid time off for various ethnic holidays?

Another sound move is to contact a consulting firm that specializes in diversity management for retailers. This person can help you respond appropriately to the changes that affect your garden center, in particular. 

“Those business owners who can effectively reach the ethnic markets and increase sales with these groups will be the leaders in their industries, with everyone else playing catch-up,” said Nesby. “You don’t want to wait for population changes in your city or community to become so immediate that you end up reacting to them, only to find you’ve missed the opportunities because you didn’t think ahead.”

Claire Sykes is a free-lance writer based in Portland, Ore. You can reach her at Claire@sykeswrites.com.