The Purchase Bubble That is About to Burst

Accounting for more than 19 million citizens, the Asian American population in the United States is rapidly increasing. In the past ten years, this group has grown by more than 10% in 49 states. Asian Americans represented 5.6% of the US population in 2010. This number is expected to hit 9% by 2050. Since the population growth has been sudden and explosive, this demographic is often overlooked.

Even more telling is how much time Asian Americans spend on the internet. Asian American men in the 25-54 age group spend 50% more time on the internet than any other race. They also make more internet purchases. This number is quickly growing; at the 2012 3AF Conference in Las Vegas, one of the keynote speakers announced that because Asian Americans are so active online, and that so little content is directed at this demographic, they have flocked to the few sources that do tailor their content.

Whether you are actively trying to target this demographic or want to expand your business, know that this market in particular is under-utilized, hungry for internet content, and growing.

Purchasing Power

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On average, Asian American households make six-figure incomes. They typically take in more money than any other cultural group, and they prefer brand name products to generics. By 2017, this demographic is expected to exceed $1 trillion in buying power.

In addition, they purchase electronics at a higher rate and with greater frequency. This emphasis on breakthrough technologies means they make more expensive purchases more often and are more susceptible to multimedia marketing.

Understanding the Differences

Statistical comparisons should be taken with a grain of salt. As a minority that still makes up a comparatively small part of the overall population, the effort to understand this demographic has been weak, though more businesses are paying attention. Despite the fact that Asian Americans tend to outspend other groups in housing, they also tend to live in places with an extremely high cost of living, like New York City, Los Angeles, and San Francisco. Asian Americans are also more likely to have more family members living under one roof. It is not uncommon to have immediate relatives living together, pushing the average, overall household income through the metaphorical roof.

The point is, while this demographic is becoming a major slice of the internet spending pie, experts are still scratching their heads as to exactly how Asian Americans fit into the overall tapestry of US online culture.

Digital Preferences and Trends

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Previously mentioned, Asian Americans are generally tech-savvy. Statistically, they write searches better tailored to their interests, use more apps, and readily invest in new technologies. Their demographic responds better to viral marketing than any other kinds of campaign.

Another trend in the Asian American community is the way they use their email contact lists. Most Asian Americans have large families, and they keep everyone on a huge list of contacts and send emails on a regular basis. They have huge networks of friends and relatives, personalized for everyone.

As a result, if a product comes out that one person likes, anywhere from 80 (low end) to thousands of people will get a word of mouth referral. News spreads quicker through this community, which is a double-edged sword. It is a great way for a small business owner to reach a huge demographic through just a few points of contact, but negative feedback can simultaneously close a lot of doors.

Reaching the Market Through Familiarity

Like every other demographic, Asian Americans want personalized content. Multicultural marketing becomes a powerful tool. While more than 70% of Asian Americans speak English, most prefer to read websites and use apps that have websites in their native languages, which some companies are beginning to deliver.

Often, large families live under one roof. As with any other culture trying to save a buck, Asian Americans tend to use stores like Costo over other retail chains. Bulk buying is efficient. Items marketed toward this demographic should be functional; purchases often come down to relevancy and ease of access. Because this group tends to include smart shoppers, products are favored when they provide more product information, not less. Generally, Asian Americans demand transparency so they can evaluate an item’s usefulness.

For this reason, product descriptions are also important. For instance, mutual funds are not referred to in the same way outside of the United States. The terminology varies country to country. After a company determines its key demographic, it will often need to refer to products using the terminology familiar to the target group. Launching the same product toward an Asian American demographic often takes some research in preferences and jargon.

Real-world Applications

If a business decides it wants to tap into this growing market, it can apply these steps in the following ways:

  • Staying transparent. Clearly outline your corporate or product goals. Have a system in place to communicate with and respond to any customer concerns, and expand into some social media outlets to take advantage of more approachable business mediums.
  • Focus on product efficiency. Regardless of the product, idea, or solution a business provides, the growing Asian American market will look for sustained use and long-term value. A one-time fix or product reviewed for a lack of dependability won’t cut it. Promote these values through a concise product description, and respond to negative reviews to establish yourself as an expert and a business with a plan.

There is no denying the increasing power of the Asian American demographic. Internet marketers and companies everywhere, take notice. By applying these ideas and being aware of market growth and changes, a business can successfully target this group.

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Jeremy Jusek

An avid coffee drinker and woodsman at heart, Jeremy spends his free time in the Cleveland Metroparks whenever possible, sometimes pretending to film Folgers commercials.

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