Diversity In Marketing: More Than A Campaign

As marketers, you should already believe – at least as a talking point – that diversity pays off. Understanding the differences among customers is at the core of what marketers do. Finding ways to motivate individual customers based on their different desires is what makes you successful. Even the daily business jargon mirrors essential elements of diversity. Personas, user experience, market segmentation, call to action and target markets are all about defining the diversity of the marketplace.

In fact, the marketing profession could be a cheerleader for diversity and inclusion. You own so many strategic data points as part of what you do. So I’m always surprised when someone in the marketing game asks whether diversity means bucks, whether there’s a business case for diversity.

Let me give you five bam-bam data points, all from validated studies over the past three years (and shame on you if you don’t already know a few of these):

  • Companies that move women to top management jobs have above-the-norm industry profitability, with annual increases up to 30%, according to a study from the Peterson Institute for International Economics and EY.
  • Ethnically diverse companies, with no single group dominating the workforce, are 35% more likely to outperform, according to a McKinsey & Company report.
  • Gender-diverse companies, having at least equal representation among workers at all levels, are 15% more likely to do better than the average (McKinsey).
  • There’s virtually a linear relationship between racial/ethnic/gender diversity and better financial performance: earnings rise close to 1% for every 10% increase in senior team diversity (McKinsey).
  • Internationally, companies in the top quartile for gender/racial/ethnic diversity are more likely to have financial returns above industry medians (McKinsey).

Apart from the intuitive argument that diversity results in better decisions and a more stimulating culture, there’s hard evidence.

In our work with top global companies, we’re exploring some remarkable aspects of how diversity and inclusion best work in business. What we see is that companies viewing diversity as numbers or percents simply run with the pack. Those that integrate diversity and inclusion into the corporate soul and culture excel.

Our own research on this was eye-opening. We recently completed an explorative study – Identity, Colorism and Labels. Of many revelations, one is that self-identity is at the core of many, many issues in the diversity and inclusion mix. Self-identity is a changeling: it varies from situation to situation, from conversation to conversation, from meeting to meeting. It is the sum of a person’s experiences: in family, in play, in music, in school, in community, in work, in society as whole.

Identity is a prime driver in decision-making. It shapes how one defines the playing field, the alternatives and the approaches to analyze problems and opportunities, solutions and partnerships. Individuals with diverse background as part of their identity – who already understand the market because they lived it – are truly a competitive asset for any company. They inherently see the larger dimensions in most every situation. They understand both the formal and the unspoken conventions in solving problems. They are uniquely in a position to be an asset for their companies, to drive more revenue to the bottom-line.

There are up-to-the-minute case histories that solidly illustrate this, on scale large and small. If you’re from the Southwest United States – Texas in particular – you may know about the H-E-B grocery chain. It’s a privately held company that prospers amid intense retail supermarket competition regionally and nationally. Since its start as family business in 1905, the company has a policy of hiring the diverse people who are their customers. The marketing theme is, in a remarkable statement of company strategy, “Our Customers Make Our Company.” It is a simple business philosophy, perhaps, but one that largely escapes most enterprises, large or small. It also assures that diversity has a voice in every marketing decision.

H-E-B stores have a remarkably loyal customer base, not only the Anglo-Texas population, but among Mexican-Americans, Vietnamese, Central American groups and now others. Stores individually stock food items with appeal to customers by local market locations. Three or four languages are uniformly spoken by staff in the grocery aisles, and reflected in signage. Special shopping opportunities coincide with ethnic calendar holidays. The company supports and celebrates population-specific community events. Customers “see themselves” everywhere in the stores. It’s all done as a natural extension of the identity of the people who manage the business, without second thought. And the marketplace rewards this diversity-sensitive approach with continuing allegiance and dollars at the cash registers.

Here’s another example. It highlights how a strong diversity voice can affect even a large company’s C-suite dynamics when the brand and revenues are at stake. Last year Intel, apart from its many Silicon Valley cohorts, stepped up to the challenge of increasing women and minorities in heavy tech positions with special energy. With full disclosure and accountability, it established a specific, reviewable timetable to improve workforce gender representation, supported with a $300-million commitment in corporate funding. By every measure, it is a uniquely strong and innovative venue, one already bringing in a more diverse population to qualify for open positions.

It did not happen by chance or through a lightning bolt of inspiration. For years, Rosalind Hudnell, now Global VP-Human Resources and Communication at Intel, drew on her background as a Black woman in business to shape and seize opportunities with the leadership circle to link improved diversity results to a more robust brand. Filtered and refined though the lens of her own experiences as a minority and as a woman, she helped engage Intel managers in ways that, incrementally and over time, opened doors to new thinking about the gender equity challenge. Steps along the way included something as small as a minority-centered intern program, as simple as college student visits by senior executives – and also as substantial as a redeployment of corporate contributions. And it all happened because she – a person who understood identity challenges because she experienced them – was embedded in leadership and the corporate culture.

I hope the message by now is somewhat clear: Diversity is not something you add to the marketing plan. It’s achieved when people with diverse experiences do the marketing plan. The fun is getting to that point in organizations.