CATALYST: PepsiCo is looking for a new agency to handle marketing aimed at African Americans. The rise of ethnic marketing was one of the hottest marketing trends of the 1900s. In fact, it was so quick that some companies have already been left behind. With expertise in the area developing rapidly, the best companies are already taking the next step: viewing ethnic advertising not a minority issue, but integral to overall marketing strategies.

PepsiCo’s search for a new marketing partner exemplifies the rise of ethnic marketing: In 1999, US advertisers spent an estimated US$1.1bn on advertising to ethnic minorities. While that was less than 1% of the $215.2bn total spend, it was an increase of 112% in just four years.

Corporate America’s sudden pursuit of the ethnic dollar has been fueled by massive demographic, economic and cultural changes, spurred on by findings in the 2000 census.

The proportion of ethnic consumers is growing – today, everyone in California is a minority, with no group forming over 50% of the population. Ethnic consumers’ spending is also on the rise – in 2001, Latino consumers had an estimated buying power of $452bn. Perhaps most profoundly, ethnic trends increasingly form the cultural cutting edge, especially in the all important youth market.

Food and beverage producers learned quickly that ethnic advertising means more than simply rewriting current campaigns in foreign languages. When Mars launched its Dulce de Leche flavour M&Ms in 2001, it backed the product with a $5m advertising campaign aimed specifically at Latino customers.

How well do you really know your competitors?

Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.

Company Profile – free sample

Thank you!

Your download email will arrive shortly

Not ready to buy yet? Download a free sample

We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form

By GlobalData

As ethnic marketing evolves at a dizzying pace, however, the next step is already being taken. While more producers are developing campaigns for ethnic markets, the most insightful, like Pepsi, are tapping trends among minorities to fuel their mainstream marketing.

Through rap, hip hop and urban fashion, African Americans and Latinos are defining youth culture for a generation of American teenagers. At $10m, Pepsi’s budget for its new partner is relatively modest – but it is money wisely spent. Producers that see ethnic advertising not as a minority issue but integral to their overall marketing strategies, will gain both market share and inspiration.

(c) 2002 Datamonitor. All rights reserved. Republication or redistribution, including by framing or similar means, is expressly prohibited without prior written consent. Datamonitor shall not be liable for errors or delays in the content, or for any actions taken in reliance thereon.