By Tomasz Dyl, Founder and Managing Director, GottaBe!
Ethnic minorities in the UK wield a hefty £300bn in purchasing power and contribute £25bn annually to the country’s gross value through their small businesses. Yet despite their economic significance, there are stark disparities in the support they receive from the finance sector.
The Black community in particular is one of the fastest-growing communities in the UK, with people identifying with Black ethnic groups rising by more than 50% between 2011 and 2021. But members of this community are less likely to trust financial services.
For example, just 43% of Black business owners trust financial services providers to give them capital support, according to research. This is just one instance of lack of trust that is having far-reaching economic implications.
To bridge the gap and effectively engage different subgroups and communities, financial services firms must offer equitable opportunities and ensure that their workforce reflects the diversity of their customer base. This means developing a thorough understanding of the motivators, cultures, and nuances of sub-groups, in order to create appropriate and effective campaigns.
Building trust and driving customer loyalty are the positive outcomes of devising and delivering a successful approach.
Generation game: understanding Black audiences
As with any audience, it’s essential to understand people’s needs, desires, and behaviours. That doesn’t mean simply taking a blanket approach: complex nuances make each community unique. Even within individual communities, there will be a disparity between first and third generations as they have different tolerance levels and cultural ties. Let’s start with some definitions:
First generation – Comprising of those born outside the ‘host country’ who eventually migrated to a new place. They tend to have strong cultural ties to their upbringing and follow this way of life even while living in the host country. This usually continues throughout their lifetime, although they become more relaxed in certain aspects of cultural differences over time.
Second generation – The children of the first generation are typically a mix, split between the culture of their heritage and the country of birth. Over time, their exposure to the culture and way of life has impacted their outlook. They will therefore have a higher acceptance of ‘mainstream’ practices. However, there must still be a level of adaptation in your messaging to ensure the approach is suitable for the audience.
Third/Fourth generation – Typically, there is complete acceptance by the third and fourth generations, and they are left more disconnected from their cultural ties than their heritage. Through the generations, each one becomes slightly less connected than the first, and the need for such adaption lessens. However, it is crucial to remember that while the third and fourth generations are adapted to the mainstream media of the country they abide in, they still require representation.
Five tips to target Black audiences
There is much to be done within the financial sector to improve the equity of services for ethnic minorities. But as demand grows, brands will need to put the steps in place to gain the trust of audiences who have been misrepresented for a long time.
Here are five initial tips for financial services brands to consider when devising more inclusive targeting strategies:
- Ensure your campaign is culturally appropriate and matches the audience you are looking to reach (no matter the generation). As we mentioned above, the Black community comprises an array of diverse cultures – research counts.
- Family-focused, vibrant campaigns can create real standout, engagement and deliver better results. All audiences want content that resonates with them – more so when they have be excluded for so long.
- Run geographically targeted campaigns, as they will be more beneficial and allow you to create targeted campaigns.
- Show the audience why they should choose your brand i.e. you care for the community and are doing something to support them. Be authentic in this approach because consumers see straight through a PR stunt.
- Don’t just accept that the majority of the Black community is second, third or even fourth generation, so they will be more accepting of mainstream media. They still have strong cultural ties and are often misrepresented.
By giving ethnic communities equitable opportunities, the economy and businesses would benefit from the growth opportunities. A 2020 study by McKinsey revealed that “nearly half of black households are unbanked or underbanked”, and that financial institutions could earn $2bn in incremental, additional annual revenue if access to financial products were more equitable across races.
Finally, as with any form of ethnic marketing, the key to success is to ensure diversity, equity and inclusion works at all levels of your business. Hiring a diverse range of people at all levels will show decisions being made for all. An inclusive workforce allows for lived experience opinions to be heard. By ensuring your brand is representing minority groups from the board room, you will be able to create a valued approach which is authentic.