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Prepared for:
Client or contact name
Title or additional names
Authors:
Stephen Palacios
Executive Vice President
Strategic CSRMarket creation for multicultural consumers
Date: 25 Sep 2008
Cheskin Added Value255 Shoreline Dr., Suite 350Redwood Shores, CA 94065650-802-2100
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© 2008 Cheskin Added Value
Why should Meeting Planners care about CSR?
CSR is exploding rapidly
• of the 250 largest multinational corporations, 64% published CSR reports in 2005*
• there is rising expectations from consumers, employees and regulatory agencies
• CSR is increasingly a C-suite initiative
Strategy and Society: The Link Between Competitive Advantage and Corporate Social Responsibility, HBR 2007
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© 2008 Cheskin Added Value
Why should Meeting Planners care about CSR?
CSR is increasingly embedded in fundamental corporate strategies
2005: Ford Motor Co. plant in DetroitPresident proud of ecologically powered roof (highly innovative, sustainable and cost effective) but NOT consumer facing while TOYOTA was winning the mindshare of American consumers with a limited release, but heavy advertising of the Prius.
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© 2008 Cheskin Added Value
Why should Meeting Planners care about CSR?
CSR is increasingly embedded in fundamental corporate strategies
2008: Companies are becoming more explicit with Consumers in their CSR initiatives and efforts
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© 2008 Cheskin Added Value
Why should Meeting Planners care about CSR?
NGOs are employing free market principles toward poverty alleviation – market making
“Washington Consensus”: post Cold War notion that deregulation, privitization and open trade is the dominant economic global paradigm
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© 2008 Cheskin Added Value
Why should Meeting Planners care about CSR?
CSR is more than Sustainability, particularly for Emerging markets
“Bottom of the Pyramid” global opportunities, efforts to sell goods and services to the near lowest economic strata, can often feel like CSR activities
In the U.S., similar dynamic for multicultural markets, particularly the U.S. Hispanic market due to its size and trajectory
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© 2008 Cheskin Added Value
Why should Meeting Planners care about CSR?
Corporations are reverse engineering the free market principle approach into more strategic CSR and for profit models - also market making
$$
$$
For Profit
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© Cheskin 2006
African American Segment Hispanic Segment Asian Segment
Total 37,502,320 Total 41,322,070 Total 12,326,216
% of
State
% of
Segment
% of
State
% of
Segment
% of
State
% of
Segment
New York 17.5 8.9 California 34.7 30.1 California 12.0 35.0
Florida 15.7 7.3 Texas 34.6 18.8 New York 6.5 10.1
Texas 11.7 7.0 Florida 19.0 8.0 Texas 3.2 5.8
Georgia 29.5 6.9 New York 16.0 7.4 New Jersey 6.9 4.9
California 6.8 6.5 Illinois 13.9 4.3 Hawaii 41.7 4.3
Illinois 15.1 5.1 Arizona 28.0 3.9 Illinois 3.9 4.1
Maryland 29.1 4.3 New Jersey 14.8 3.1 Washington 6.2 3.1
1 in 3 U.S. consumers are AA, Asian, or Hispanic
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© Cheskin 2006
Ratio of Non-Hispanic Whites to Other Races/Ethnicities by Age
Source: US Census
0-9(1 : 1.5)
10-34(1 : 1.7)
35-49(1 : 2.5)
50-64(1 : 3.4)
65+
(1 : 5.0)
Age
Non-Hispanic White Other Races/Ethnicities
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© 2008 Cheskin Added Value
Hispanic population moving from minority to plurality means new thinking about targeting the general market.
Redefining the Marketplace
0
40
80
120
160
1990 2000 2010 2020 2030 2040 2050
Popu
lati
on in M
illio
ns
Source: US Census
0%
10%
20%
30%
40%
50%
His
pan
ic P
erc
en
t of
Tota
l Popula
tion
Source: US Census Projections 1990-2050
TOTAL U.S. HISPANICS POPULATION
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© 2008 Cheskin Added Value
Current Confusion: CSR and Multicultural Marketing in Health Care
Director under Social Responsibility
Individual policy sales team
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© 2008 Cheskin Added Value
Define the issue appropriately: disassemble first
Strategy bridging the two is where success lies
Confusion comes with most multicultural initiatives
• Commercial actors can be skeptical of efforts as non revenue enhancing.
• Non commercial actors can place all emphasis on social benefit goals.
• Clear distinctions, goals, and metrics are required for both to succeed.
• With immigrant markets, the opportunity to bridge both is greater (market creation function).
Social Responsibility/
Good Citizenship
Commercial Successvs.
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© 2008 Cheskin Added Value
Commercial Realm
Corporate Social Responsibility
Program Goals
Profit goals are the same as for other markets.
Conforms to certain systems and processes.
Focuses on improving current business.
Servicing existing members and attending to prospective, qualified members.
Program Goals
No profit
Enhance corporate reputation
Education focused
Mitigate negative criticism from social/political entities
Assistance for those that cannot afford healthcare.
Market Development
Program Goals
Focus is on self-sustainable initiative; little profit.
Experimentation with new programs, products.
Membership/market development by transitioning people to transactional economy. Transition them to become viable commercial members in future.
Creating An Offer by Aligning CSR and Multicultural Marketing
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© 2008 Cheskin Added Value
Case Study: Aligning CSR with Non Profits to Build Multicultural Markets
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© 2008 Cheskin Added Value
Going Forward: How will CSR continue to evolve?
-Organizational Structures will change to reflect Strategic CSR with Marketing and market building
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© 2008 Cheskin Added Value
Going Forward: How will CSR continue to evolve?
- Consumers expectations for corporations will continue to rise
- Employees, particularly Millenials, increasingly will include CSR efforts in their employment decisions
- Companies in the services realm in the U.S. will increase their CSR and Multicultural marketing alliance
- Companies that are serving emerging markets will increasingly employ Strategic CSR efforts to build markets
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© 2008 Cheskin Added Value
Going Forward: How will CSR continue to evolve?
- Companies are more holistic in their strategic CSR
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© 2008 Cheskin Added Value
Program Goals
No profit
Enhance corporate reputation
Mitigate negative criticism from social/political entities
Program Goals
Little to No profit
Education of emerging consumers
Experimentation of new programs, products.
Membership.
Corporate Social Responsibility +
Corporate Social Responsibility
Program Goals
Profit at a certain level
Conforms to certain systems and processes
Commercial Realm
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