Net Meeting

Ethnic Markets & Seniority Rules

Members of minority ethnic groups are in one way the ideal online customers. Because they are living in an alien culture, they find themselves shopping for goods and services that aren't part of mainstream retail offerings. The Web, with its global reach, is ideally suited for filling that sort of specialized need. For instance, music is an especially popular item for Hispanic consumers, says marketer Derene Allen. "Music is one of the top categories, primarily because they're looking for the harder-to-find artist," she says. "You can go online and find those without having to drive all over town." After music CDs, top Hispanic purchases include electronics, clothing, books, computer software and hardware and gifts.

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Internet use among minorities is still in its infancy. While 60 percent of Caucasians use the Net, just 40 percent of African Americans and 32 percent of Hispanics have online access, according to the Department of Commerce. Only Asian Americans match the Caucasian Net penetration figures. Language is one problem. Hispanics prefer Spanish sites, while English is the dominant language of the Web.

Challenges facing online marketers in this area include understanding there is no monolithic ethnic market. Hispanics, the largest and fastest-growing minority group, have different needs from African American and Asian American consumers. Among Hispanics, there are significant differences by country of origin, says Allen: "Mexicans' top purchases are airline tickets, whereas for Puerto Ricans and Central Americans, it's music, and for Cubans, it's electronics and computer hardware."

Online sellers are exhibiting innovation in coming up with new ways to lure online shoppers. For example, Allen points to cross-border transfers that allow U.S. shoppers to buy big-ticket items for relatives in other countries: "You can go online and purchase a washing machine or DVD player for your family in Mexico or Central America and pay for it online and have it delivered to their door."

Seniority Rules
Senior citizens are under-represented online, making up only 12 percent of U.S. citizens and just over 6 percent of Net users. However, seniors are fast increasing online activity. During a two-year period ending last year, according to research firm Nielsen/NetRatings, the number of online seniors nearly doubled, to 6.8 million.

The increasing importance of seniors presents a challenge because selling to them isn't like selling to other demographic groups. For one thing, seniors are far more likely to engage in information-gathering about products than to actually buy products online. For another, they have much different requirements when it comes to Web site usability, explains Jakob Nielsen, principal with Nielsen Norman Group, a Fremont, California, researcher of Web site usability. Too-small text, confusing pop-down menus and overly restrictive registration procedures are all problems likely to turn seniors away instead of turn them into customers.

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This article was originally published in the February 2003 print edition of Entrepreneur with the headline: Net Meeting.

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