Asian Americans are increasingly becoming a visible presence in the top cities of America. Not only are they opening businesses of their own, but they make up a growing percentage of retail customers. And they are shoppers with unique buying habits. A few simple facts and tips suggest ways for the retailer to be attracting this lucrative market.

It's true that Asian Americans make up just 4% of the U.S. population. But they have a much greater impact than this statistic would lead you to believe. How so? Fully 93% of this population, estimated to be over 9,850,000 strong, live in urban centers. With an annual growth rate of 5.2% annually, which is the fastest population growth of any group in the U.S., Asian Americans are projected to make up 10% of the population, or 20 million people, by the year 2050. Compare this to the growth rate of Hispanics (3.0%,) African Americans (1.3%) and non-Hispanic Whites (0.6%) and it's clear that this is a market that deserves attention.

To retailers in one of the cities where the Asian American population resides, it's already obvious that this is a market of interest. The top 5 MSAs for all Asian Americans are Los Angeles-Long Beach, CA; New York, NY; Honolulu, HI; San Francisco, CA and Oakland, CA. In the San Francisco Bay Area, for example, 18% of the population is Chinese.

With a total purchasing power of $9.8 million, retailers and marketers are taking notice of the habits and buying preferences of the Asian American market, and tapping into it.

For facts about Asian American shoppers and tips on how to attract them, MMN interviewed Saul Gitlin, Director of Strategic Marketing Services of Kang & Lee Advertising, Inc., the largest, full-service marketing communications company solely focused on linking corporate America to the Asian-American marketplace.

What makes this a desirable group? "They have the highest median household income of any group in the country," said Saul Gitlin. "Not just among ethnic groups," he underscored.
Yes, they are starting businesses of their own. Asian Americans started a higher percentage of new businesses (between 1987-1992) than the general population, increasing the number of firms by 61% compared to the total U.S. increase of 26%. And they were successful at it as well, increasing receipts by 193% compared to the total U.S. Increase of 67%. Asian Americans are indeed a force behind the counter.

But their buying power and habits as customers in stores is what retailers are noticing.
"Asian Americans consume products just like everyone else," said Gitlin. "But in some cases, they are using certain products at a higher rate than the general population. Asian Americans index very high for the consumption of orange juice and cooking oil, and extremely high for bottled water."

This group exhibits unique preferences in their consumption of carbonated soft drinks, he noted. "They are different in the type (cola vs. non-cola) and the brands they select," Gitlin said.
When it comes to personal care products and cosmetics, Asian Americans have special needs that retailers can fulfill. "Asian Americans, as a whole, are very interested in skin care products. And they look to cosmetics to enhance their natural beauty rather than transforming their image into something else," he revealed. This has implications as to the type of products they seek to buy.

"Their diets will impact the consumption of OTC products related to stomach ailments and indigestion, due to the heavy emphasis on spicy foods," Gitlin said.

"And since their average age is very young and their birth rates are quite high, products related to child care are important to this segment," he added.

Some of the biggest corporate names in America are already making long term commitments to the Asian American market. As examples, he pointed to clients Sears and Bank of America, who looked at their retail locations in the Asian American community, as well as Oxford Health and of course, AT&T, which saw an opportunity to attract customers calling Asia.

But the fact that Asian Americans have a strong preference to communicate in their native language has the strongest implications for retailers and marketers.

"Because there are 15 ethnic groups within the Asian American population, it may seem daunting to try to reach this group," said Gitlin. "How do you target them? In fact, they are easy to target. They are sitting in 5 main urban centers. And six groups make up 85% of the 15 ethnic groups. What's more, language 'preference' does not imply that these groups have not acquired the ability to understand English, but rather that they prefer to speak their language," he said. "Companies and stores that communicate to these groups in their native language convey a high degree of respect for these markets and we know from our experience with our clients that this builds tremendous loyalty in the market."

Obviously, for retailers who know they are operating in the midst of an Asian community with significant retail traffic by Asian consumers can build up sales by adding bilingual sales personnel and by addressing the consumers' needs by carrying select products. "Being an Asian - friendly retail point does not necessarily mean a complete overhaul of sales personnel and products," said Gitlin. "It could be as simple as placing a welcome sign on the door in the target language and providing some signs on the shelves."

For a company that wants to go beyond a sign, the most effective way to reach these consumers is through Asian media. Today there are more than 500 Asian language media vehicles nationwide addressing the needs of this market, according to Gitlin, whose company has published the Asian Media Reference Guide. "Asian media has had explosive growth in the past ten years, proof of the demand in the Asian American community for Asian language media."

According to Gitlin, Asian Americans become extremely loyal to companies that make an effort to reach them in their language. It gives retailers a distinct advantage over a store that doesn't bother.

By responding to the language preferences of the Asian American community, with an ad campaign or a simple sign, marketers and retailers will see increased traffic and sales in the growing - and lucrative - Asian American market.

For more information, please contact Lisa Skriloff, 212-242-3351, infobrokr1@aol.com or Saul Gitlin, 212-889-4509 ext. 114.

This article was written for publication in Urban Call, the trade magazine for urban retailers. For more information about Urban Call, contact publisher Lafayette Jones, 910-759-7477.