Michael Lee, an expert on marketing to minorities, operates EthnoConnect in Dublin, Calif. Reach him at 800.417.7325.
REPLACEMENT CONTRACTOR: What are home improvement contractors missing when they ignore the minority market?
Michael Lee: A huge opportunity. There is a great influx of minorities coming to the U.S., and many minorities that have been here for generations but that are just beginning to develop enough wealth to buy homes. From 1991 to 2000, 2 million pre-1985 homes changed ownership to minority homeowners. Many of these are starter homes or fixer-uppers that need new windows, siding, or roofing. And minorities are remodeling: From 1995 to 2003, remodeling by Hispanics rose by 85%, and remodeling by Asians rose 66%. Remodeling by Caucasian families was flat.
RC: How do contractors find minority clients?
ML: The U.S. Census Bureau Web site (www.census.gov) can tell you about an area's cultural composition, pinpointing it to the neighborhood, to the block almost.
RC: How do contractors reach out to minorities?
ML: Hispanics can be easily reached through direct mail. A typical return is usually 1% but with Hispanics it's 12% because they don't get much mail and they read all of it. Radio is a great way to reach African-Americans, because they're aurally oriented. Asians are visual, so newspapers work well for them.
Then there's community marketing, where you get involved with the community on a one-on-one basis. If they see you week after week supporting their community, that builds trust. Word of mouth builds trust, too. White Americans go to the Yellow Pages; minorities go to one another.
RC: Assuming I have leads for minority customers, what then?
ML: Be sensitive to who they are, what they want, and how they expect to be treated. The problem is that white contractors turn off minority customers from the moment they meet them. They assume that minorities just want ideas and will then do the job themselves on the cheap. Ask about their culture. Find out how long their family has been in the U.S. Once you begin to ask, they'll open up to you.
RC: What would be the best way for contractors to approach the growing African-American middle class?
ML: The No.1 users of online lending today are African-Americans because they believe, “if you can't see me, you can't discriminate against me,” and that they'll get a better loan rate that way. Building relationships with this community is tough because they've been so mistreated. You have to go to great lengths to show you care more about them than their money and that you're fair and won't discriminate. The best way to learn about the African-American middle and upper classes is community involvement. You'll stand out because you'll be the minority.