How Valuing Black Consumers Pays Off

A study says that African Americans have distinct brand loyalty that may be a boon for black ad agencies.

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(The Root) -- American corporations have long crushed on black consumers, who spend multibillions annually on goods and services. The results of a new poll may entice companies to take their corporate lust deeper.

The study, conducted by New York marketing-analytics firm NewMediaMetrics, shows that African Americans are more brand-loyal than whites and are eager to share their satisfaction with family and friends, as well as to urge others to buy or use their selections. Today's black consumers dote upon UPS, Tide detergent, Oreo cookies, Ragu sauce, Bounty towels, Betty Crocker food products, Wal-Mart and the Gap, to name a few brands. The survey also revealed that African Americans have stronger emotional ties than whites to specific Japanese and German luxury cars, Google, the iPhone, Nike sports apparel and Microsoft.

Plus, when it comes to advertising awareness and use of new social media, blacks are also leaders and respond more actively to broadcast and cable networks. In addition, NewMediaMetrics found that blacks are more socially networked and are greater users of mobile videos and texting on small and large mobile devices. Black consumers also use services such as Netflix, Hulu, Twitter and YouTube more than whites do.

The money that African Americans spend on goods and services is vital to keeping mainstream producers and providers profitable -- and that makes blacks, to coin a phrase, swing buyers. They are coveted individuals whose brand loyalty has been earned by companies who have treated them respectfully. Their allegiances could shift, however, if other companies proffer the same quality of products and services.

There are hundreds of billions of dollars up for grabs. According to "The 2012 Multicultural Economy," a report published by the Selig Center for Economic Growth at the University of Georgia, black spending this year will be slightly more than $1 trillion. Hence, there is a huge incentive for corporations as well as mainstream and black advertisers to enhance their understanding of and tap into African-American purchasing power.

That's where NewMediaMetrics, which is not black owned or operated, and its first African-American 360 Brand and Cross-Platform Analysis project comes in. The six-year-old firm has sold corporations general-market data and findings derived from its quantitative approach, which assesses buyers' "emotional attachment" to goods and services. Marketers use this knowledge to predict consumer purchasing and media-viewing behavior. NMM customers include major packaged-good manufacturers and Internet and wireless companies.

The company conducted its first study of black consumer decision making this past April, says Gary Reisman, NMM's co-founder and principal. The patent-pending methodology that NMM used was direct: The company recruited 3,500 black men and women nationwide between the ages of 13 and 54 to offer their opinions about more than 350 brands in 40-plus categories of goods and services, as well as about more than 300 media properties. Participants graded their emotional attachment to the brands and properties on a scale from 0 to 10.

Reisman says that in order for companies to increase revenues, it is critical for marketers to understand why -- and to aggregate data on how -- blacks buy certain goods and services. "The greater attachment that someone has to a brand or media property, the more willing they are to listen to your message," he told The Root. "[The data] tells marketers that African Americans are more attached to certain brands and less price-sensitive to similar products when shopping [for] or utilizing products and services."

Detavio Samuels, executive vice president of client services at Global Hue, the nation's largest black-owned ad agency, appreciates that approach. He says that those in the multicultural ad space have always known that blacks are brand-loyal.

The problem from the black-agency perspective was and is that too often, brand companies hire general-market advertisers and marketers instead of those that focus on the black consumer. By providing empirical evidence of the scope of black brand loyalty, what NMM has done is strip away the idea that black marketers bid for business based solely upon personal or cultural familiarity with what blacks eat, drink, watch, wear or drive.

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