Survey Drives Home Point: Auto Makers Slow to Target Minorities
For years, most car makers have generally believed they were spinning their wheels by targeting minority groups. The assumption has basically been that minorities are attracted to the same cars as the general market.
Wrong.
In fact, African Americans and Latinos often prefer different cars than the general market, according to a recent study of 1,000 African Americans and Latinos by the Washington research firm Minority Markets & Trends. The top car choice of African Americans was the Buick Regal. And the car most often selected by Latinos as their “next car” was the Toyota Corolla. For comparison, the best-selling car in the general market last year was the Ford Taurus. Asian American car buyers were not tracked in the survey.
Researchers say the survey offers an unmistakable lesson for auto makers: Since minorities often have different car preferences than those of the general market, car makers need to understand the differences--and act upon them in marketing efforts.
The survey results also tear down racial stereotypes, “such as African Americans going for flashy, big cars, and Hispanic Americans driving older cars,” said Carrie Weeden, president of Minority Markets & Trends. Among those surveyed, for example, Cadillac did not rate among the top five car choices--or even the top five “most admired” cars--by African Americans.
The No. 2 and No. 3 “next car” choices of African Americans were the Ford Taurus and Toyota’s Lexus. The second and third car choices by Latinos surveyed were the Ford Probe and Honda Prelude. By comparison, the No. 2 seller among general market consumers last year was the Honda Accord, followed by the Toyota Camry.
The survey did not address how income variables might affect car choices.
Minority marketing experts say that Motor City executives clearly need to take a fresh look at the auto industry’s generally lax minority marketing programs. While the Big Three spent nearly $3 billion on domestic advertising last year, less than 5% of that was spent on minority-related marketing, according to industry estimates. That was not nearly enough, they say.
“Minorities are as interested as any group in acquiring the trappings of the American way of life,” said Gary Berman, president of Market Segment Research, a Miami-based firm that specializes in minority research. “As minorities move up the socioeconomic levels--and as they get older--they are more likely to buy new cars.”
Critics contend that by skimping on minority ad spending--and using minorities sparingly in general market ads--car makers are harming themselves.
“The auto makers treat minority marketing as almost an afterthought,” said Peter Brown, editor of the Detroit trade publication Automotive News.
At least one importer, however, has been ahead of the game. In 1987, Toyota was among the first car makers to begin targeting Latinos with Spanish-language ads.
The move has paid off. Nearly 13% of Toyota’s cars and 10% of its trucks in the U.S. market are sold to Latinos, the company estimates.
Meanwhile, according to Toyota’s internal research, the Japanese importer leads all car makers in Latino “brand awareness,” said Bill Fay, national ad manager at Toyota Motor Co. Such successes have caught the attention of some domestic auto makers, which more recently began to take concrete steps to target minorities.
For nearly a decade, Ford Motor Co. has sent detailed surveys to new car buyers several months after they purchase their cars. But the surveys--which ask dozens of detailed questions--have always been available only in English. Beginning in 1994, however, Ford will start mailing bilingual surveys to its Spanish-speaking customers.
The company also plans to increase its Spanish-language ad spending by 30% in 1994, said John Vanderzee, national ad manager for Ford Division. “We need to do a better job with this market,” he said.
While a growing number of minorities--Latinos in particular--are turning to imports, the Minority Markets & Trends survey found that many minority consumers say they would prefer to buy American-made cars.
“It’s always been a given that minorities will buy American,” said Kathy Jackson, a reporter at Automotive News who specializes in minority car markets. While the Big Three have about 75% of the nation’s minority consumers as their customers, Jackson said the number is dropping, even among blacks “who feel the Big Three do little to market to them.”
The Cadillac Division of General Motors Corp. concedes that it does very little minority marketing. “We realize it’s an area where we have a deficiency,” said Steve Gaut, a spokesman for the division.
But auto makers who are paying little attention to minority markets might want to reconsider. Nearly half of the African Americans and Latinos surveyed by Minority Markets & Trends said they planned to buy a car within the next 12 months.
“That’s an open invitation to the auto industry,” Weeden said. “They should be doing everything they can to induce minorities.”
Briefly . . .
Venice-based Chiat/Day has picked up the ad account for Oakhurst, Calif.-based Imagination Network, an on-line computer game service. Meanwhile, New York-based Chiat/Day East has been named to launch the first shoe line for Starter footwear, a large licensed sports apparel brand. . . . Italia/Gal has, on an interim basis, picked up the retail marketing account for First Interstate Bank of California. . . . The San Francisco agency Hal Riney & Partners is in merger discussions with New York-based N W Ayer. . . . The Los Angeles office of Grey Advertising is handling the $30-million Carl’s Jr. account on an interim basis.
Spinning Wheels
Minorities and general-market consumers have different favorites when it comes to buying cars. When 1,000 African Americans and Latinos were recently asked to name the next car they plan to buy, their answers differed from the top five choices of the overall market.
Rank African Americans Latinos General market 1 Buick Regal Toyota Corolla Ford Taurus 2 Ford Taurus Ford Probe Honda Accord 3 Lexus (Toyota) Honda Prelude Toyota Camry 4 Chrysler LeBaron Toyota Camry Ford Escort 5 Nissan Maxima Chrysler New Yorker Honda Civic
Sources: Minority Markets & Trends, Automotive News
