MELTING POT MARKETING RETAILERS APPEAL TO MORE OF AMERICA BY CATERING TO ETHNIC CUSTOMERS.
Byline: SOPHY FEARNLEY-WHITTINGSTALL
CHICAGO--Generic customers are out of fashion. Increasingly, major retailers like Spiegel, Carson Pirie Scott, Sears, Roebuck & Co. and J.C. Penney are recognizing that different ethnic groups have different needs, and they are adjusting their strategies accordingly. "There isn't really a mass market anymore," said Mary Brett Whitfield, manager at Management Horizons, the Columbus, Ohio-based retail consulting division of Price Waterhouse. "The Hispanic, African-American and Asian-American population is growing faster than the white population, and they also have increasing purchasing power." Statistics from the U.S. Department of Commerce Bureau of the Census prove her point. While the overall population is projected to grow by 15 percent by the year 2010, growth rates are much higher among minorities--22 percent for African-Americans, 56 percent for Hispanics and 86 percent for Asians and Pacific Islanders. For stores, these statistics have important ramifications for merchandising and marketing. "It's a matter of understanding who your customers are, not only their ethnic mix," Whitfield said. In June, the Chicago Apparel Center helped lead the way for retailers hoping to attract a specific customer to their stores. It set up Boutique Afrique, a showroom filled with merchandise chosen specifically for its appeal to African-American consumers. The showroom came about as a result of repeated requests from stores, said Dorothy Fuller, vice president of the apparel center and director of its retail development program. The project was so successful, attracting interest from more than 500 buyers, that it will probably be repeated and expanded next April. The center is also considering a similar initiative targeting Hispanic customers, Fuller added. Penney's has also been at the forefront of retailers' efforts to target ethnic customers. The moderate department-store chain, which buys on a regional basis, has a team of four special segment coordinators at its Dallas headquarters. Each is responsible for an area--men's, women's, children's and home. Studies compiled by Penney's show that Hispanic and African-American women prefer bright colors over pastels. They also favor embellished styles. In shoes, black women are more likely to wear larger-than-average sizes and Hispanic women are more likely to wear smaller ones. Hispanic women would also like to see more petite-sized clothing available. The chain employs a designer, Anthony Mark Hankins, to create special-segment merchandise in colors and fabrics that the ethnic customer likes, said Terry Michalski, assistant store manager at the Ford City store. On a local level, Michalski shops the Apparel Center for resources that appeal to African-Americans. "Every time we get that merchandise in, it blows out of the store. It's got to be special and unique," Michalski said. He noted that in some stores, as much as 30 percent of merchandise could be special segment. Carson Pirie Scott, a moderate department-store chain based in Milwaukee, tailors its merchandise assortments--in size, color and style--according to the demographics of the market, said a spokesman. "For example, the total marketplace might indicate that size 14 and above might be 35 to 40 percent of the total population. The stores that are predominantly African-American might be in a higher percentile, so we would adjust our assortments accordingly," he said. "Our strength is based on tailored assortments. We treat each and every store as its own marketplace." Carson's buys in some resources specifically for its predominantly African-American stores, noted Bill Lasche, vice president of fashion and product development. He cited WeBeBop's use of color and interesting prints in sportswear and dresses, and Sharon Anthony's bright prints as two examples. Mail-order giant Spiegel, based in Downers Grove, Ill., has proved that niche marketing works. A year and a half ago, the company launched E-Style, a catalog for black women. The book's circulation has doubled this fall, to two million, and the number of pages will increase from 64 to 72 for the spring '95 catalog, said Lori Scott, merchandiser for E-Style. "The customer is very pleased with what we're giving her. She likes the idea that the clothes are catering to her fit and her fashion and come in colors that are complimentary to the black woman," she said. The catalog has had particular success with suits, dresses and millinery. "Black women like to dress head to toe, and it completes the look when you top it off with a hat," Scott said. Sears, based in Hoffman Estates, Ill., is able to track sizes, colors and styles in individual stores through its computer system, Sears Apparel Merchandising System or SAMS, said a spokeswoman. This enables it to adjust assortments to meet the needs of the local population. "Sears is committed to meeting the needs of our diverse customer base," said John Costello, senior executive vice president of marketing. "We make sure we have the right merchandise, service and marketing to respond." Besides tailoring individual store assortments, Sears targets minorities with some products. One example is Essence hosiery, an upscale brand made for black women, launched last year. The chain has also been actively marketing to Hispanics. The spokeswoman noted that 130 stores in the 800-store chain are designated Hispanic, meaning they are located in areas where at least 20 percent of the population is of Hispanic origin. Sears also publishes a Spanish-language magazine called Nuestra Gente, which is distributed free to Hispanic households across the United States. The magazine has increased its circulation from 100,000 initially, when first published in May 1993, to 1.5 million. The company plans to step up its marketing efforts this fall with a new advertising campaign for its Hispanic customers called Toto Para Ti, which means "everything for you."
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