"What," you may ask, "is the 85% Niche?" And, "What does it have to do
with the automotive market?" Well, the answer to that is twofold: The
85% Niche stands for the power that women represent as consumers in the
automotive industry. Yes, women influence the purchase decision of up
to 85% of all new car
and truck sales in this country and buy over 44% of all new vehicles!
That's over 6.3 million new cars and trucks. And at an average price
of $30,000 per new vehicle, we are talking about roughly $200 Billion
dollars in automotive sales led by women. Among women of color--Black,
Latina, and Asian--we are looking at an audience that purchases over
1.4 million new cars and trucks (22% of all women
purchases)--generating $42 Billion dollars in sales. There is no
disputing that we are a force to be reckoned with--no matter what our
ethnicity or culture!
The 85% Niche also represents the name
of the company I founded three years ago after having spent 25 years as
an executive in Fortune 100 automotive and consumer packaged goods
companies. As the head of marketing and/or diversity, I sat at the
decision-making table, marshaled the troops to create advertising and
brand messages that connect with women, launched new products that were
aligned with our needs as consumers, developed sales training to help
retail teams learn how to build effective relationships with women, and
executed these programs in a way that generated incremental sales and
profits. Now, as CEO of The 85% Niche, I can focus
this experience to help companies tap into the power of all
women--White, Black, Latina, Asian, Native American, Middle Eastern,
and more--and across many industries (from automotive to financial
services, to home improvement, travel, consumer electronics and more)
through women/diversity savvy marketing and sales strategies. My goal
is to dispel the notion that women are a "niche segment"; we are a
powerful group of consumers capable of generating significant business
results!
Consider these facts about the diverse woman of color buyer:
- Black, Latina, Asian, and Native American women together, accounted for 31% of women in the U.S.--or nearly 46 million persons in 2004. In two short years, by 2010, this number will swell to over 52 million women.
- If diverse women of color were a country, we would be nearly as large as any one of the European nations--Spain, Italy, or the United Kingdom.
- We are increasingly well-educated. 43% of Asian women, 17% of African American women, and 11% of Latina women have a bachelor's degree (vs. 24% for women overall). Educational attainment among other groups, such as Middle Eastern Arab Americans is also high; the proportion of those with a college degree is higher than the national average and the number of those attaining master's degrees or higher is twice that of the general population.
- Economic buying power among diverse women of color is nearly $1 trillion dollars, larger than the GDP of many wealthy countries, including Saudi Arabia, South Africa, Taiwan, and Argentina.
- Women of color span many different economic strata. There are approximately 2.6 million U.S. households who earn incomes of over $200.000. 14% of these are of households of color...with an annual combined disposable income of approximately $75 billion dollars.
- Diverse women of color own 1.4 million firms, generate $147 billion in sales and employ 1.3 million people. These firms grew at six times the rate of all U.S. firms (1997 vs. 2004). All told, women of color own 22% of U.S. privately held, women-owned firms.
- One in four new car and truck purchases by women is made by a Black, Hispanic, or Asian woman. This will vary from market to market based on the density of the ethnic population to a particular geographic area--in markets like California and Texas where 50% of the population is diverse, new car and truck purchases by women of color can be closer to two in five.
- Prestige and luxury car and truck purchases perform particularly well among African American and Asian women. The quality, styling, interior appointments, and luxury features of these vehicles make them particularly appealing to aspirational women buyers.
What this means for the
automotive industry among other industry leaders, is that diverse women
of color are pivotal consumers. They are a segment of buyers not to be
overlooked or marginalized as inconsequential to the bottom line.
In fact, based on diversity
population growth trends, corporations will be increasingly more
dependent upon diverse women of color to achieve company sales
targets. As the general market declines in size, the diverse and
women's markets take on more and more importance. Focusing on the needs
of all demographic and gender groups, is essential to fundamental
business growth.
The automotive industry has taken note of the
power of women. Volvo, for example, had eight women design a concept
car focusing on ergonomics, space and storage needs that women told
them were important. General Motors launched a series of "Women in the
Driver's Seat" educational booklets for women and women of color,
focused on the car buying
experience, what to expect during service, and safety features. In
addition, Saturn Ion's seating accommodations, telescoping steering
wheels, adjustable pedals and safety features appeal to a wide spectrum
of demographic and gender segments. Ford's Focus is great on style and
versatility--two features that women and diverse women of color rate
highly.
While these are great initiatives, it's important for
the automotive industry to continue to recognize that when a
woman--especially a well-educated and professional woman--is
considering a new car or truck, she is comparing the dealership
experience with the service she receives at Nordstrom's, Sak's, or
Neiman-Marcus. We know from extensive research that there are certain
triggers that will engender strong reactions from women and women of
color--positive or negative--during the retail dealership experience.
Consider this statement from one woman of color interviewed by The 85%
Niche:
"...As I walked into that car dealership, it's amazing
that I walked out of one equally as fast when they asked whether my
husband was going to co-sign. They made an assumption about me...about
my buying power."
Or my personal experience many years ago, when
on a Saturday, dressed down very casually with jeans and a summer
shirt, I walked into a dealership asking for information on a new SUV.
The dealer
gave me the quick "once over" and asked if I could send him a copy of
my pay stub as part of the application process. Not knowing that this
was illegal (I was not in the auto industry then), I sent him a copy of
my pay stub, only to have him call me and ask if I had accidentally
added some zeros to my pay stub, increasing my salary level! Clearly,
this dealer could not imagine of woman of color being able to afford a
luxury SUV, much less earn such a high six-figure salary.
Fortunately,
this kind of behavior is less prevalent today than it was 20 years ago.
Dealer body groups are increasingly aware of the need for diversity and
sales training. They encourage their sales and service consultants to
participate in this training and many are actively recruiting more
women and diverse staff to mirror the marketplace. This is good
news...good news that bodes well for the industry and for women and
diverse women of color new vehicle buyers. They are, after all, the
85% Niche.
By Miriam Muley,
CEO, The 85% Niche
Miriam
Muley maintains a vibrant entrepreneurial business as strategic
marketing consultant, professional speaker, diversity expert, and
business writer. Her new book, 'The 85% Niche: Rallying the Power of
Women of All Colors for Exponential Business Results," will debut this
fall. She is CEO of The 85% Niche (www.85percentniche.com),
a company committed to providing a "voice" to all women and to helping
companies appreciate that marketing to women does not mean marketing to
Caucasian women alone. She does so through gender and diversity savvy
marketing strategies that connect brands with women of all ethnic,
cultural, and socioeconomic backgrounds--Latina, Black, Asian, Middle
Eastern, and more.
Ms. Muley, a Puerto Rican by ancestry,
holds a M.B.A. in Marketing from Columbia University's Graduate School
of Business and has 25 years of executive marketing and sales
experience in Fortune 100 companies. She was Executive Director of the
Women's and Diversity Markets at General Motors Corporation and General
Manager at Avon Products, Inc. She resides in Michigan with her family
and is a voracious reader, often devouring three books at the same
time.
creative commons images courtesy of itsallaboutmich
automotive advice for women
