February 12, 1999

Ethnic Groups are Biggest Telecom Spenders, Says Insight Research

PARSIPPANY, N.J..- This country's leading ethnic groups are spending more of their income on local and long distance phone calls than the general population, says a new Consumer Telecom report by Insight Research.

According to Insight's report "Telecom Marketing Opportunities to Ethnic Groups," Hispanics, Asians, and African-Americans represent 25 percent of the US population, but they are responsible for 29 percent of long distance revenue and 37 percent of local telephone service revenue. In many urban markets, ethnic groups can account for as much as 50 percent of all telecom revenue. By 2002, the ethnic telecom market will total almost $50 billion, a huge portion of revenue that could make or break the success of even the largest telecommunications company.

"It's obvious that telephone companies must put increasing importance on marketing to ethnic groups, but reaching these consumers requires extremely targeted, specialized efforts," says Robert Rosen-berg, Insight's president.

The Insight study reveals that ethnic consumers consider customer service as the number one criterion for selecting a telecom carrier. This suggests that all contact and communication with the ethnic customer should be available in-language, in-culture, and in tune with their social values.

Ethnic customers are very quality conscious and will not choose carriers who lack understanding of their cultural distinctions. "You cannot simply translate existing marketing materials into another language and call it an ethnic strategy," Rosenberg continues. "Nuances as subtle as background color can connote vastly diverse meanings in different cultures."

Further ethnic consumer demographics and forecasts of telecom service revenue are published in "Telecom Marketing Opportunities to Ethnic Groups," a 96-page market research.

Primary research consisted of interviews with regulators, industry players, and academicians, as well as Insight's proprietary survey of 1,018 consumers. For this sample, the survey data was weighed to account for probabilities of random selection and balanced by age, gender, race, and education to match U.S. Census demographic variables.

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