** First of an exclusive series of articles for RESEARCH-live.com looking at the consumer trends shaping the world in the next several years, Panoramix Global examines the importance of migrants as consumers, entrepreneurs and innovators.
From the moment mankind crawled out of the ooze we’ve been leaving the place we were born, making our way around the world: migrating. Since then immigrants have changed the face, fortune and very course of nations. These movers and shakers integrate into their host countries as consumers, employees and community members, actively participating in the culture and economy. From the energy of entrepreneurship and social engagement to community norms and political transformation, immigrants are a force to be reckoned with and a market to tap.
Consider that in the US alone the potential of immigrants as a valid target market is staggering. Latino and Asian buying power (including native-born) topped $1.46trillion just two years ago, according to the Migration Policy Institute. Now imagine the impact a focused, culturally resonant marketing campaign would have on this unrecognised segment of the population. Opportunities await in supermarket sales, restaurants, travel, media programming, telecommunications and banking – and that’s just the marketing piece.
Migration and immigration are a fact of globalisation and marketers must build brand loyalty with mobile consumers by researching their cultural values, passions and challenges. Walk a mile in their shoes. How can corporations possibly capture this audience without understanding their unique needs and aspirations?
Grasping the implications inherent in migration is key for short- and long-term strategic plans.
• Where demand grows, a migrant workforce follows – and often stays.
• New blood is the fuel of innovation – original product development, categories and markets will emerge over the next decade.
• The growing population concentration in cities will require a new focus on social, cultural and civic functions. Start considering how ideas, products and services will be communicated, distributed and retailed.
• Geographic borders continue to blur and the result is a melting pot of demographics in every community. The cultural fusion will require marketers to develop better niche targeting skills.
• Upwards shifts in age and demographics will force employers to reconsider the make-up of the workforce and develop strategies that take into account employee experience.
No passport required
Today nearly one billion of the world’s 6.7bn people are on the move – meaning one in seven of us is some type of migrant. But a significant portion aren’t making a run for the border. The United Nations Development Programme reports that some 740m are hitting the road inside their own country in search of cities or towns that offer short-term income or opportunity for a permanent better life.
The culprit behind the slowdown in cross-border movement is the continuing global recession. Immigrants are staying in their adopted countries to ride out the storm rather then face even worse conditions at home. Once the recovery gains momentum and demand resurfaces, migration movement will be drawn to those countries racing out of recession. But for emerging economies like Brazil, India and China, potential immigrants may simply stay at home.
Anti-immigrationists might find this shift appealing but could find themselves without the workers necessary to fill jobs if there is a massive upset in the migration ecosystem.
It’s all about the Benjamins… and pesos… and lira…
Migration is an increasingly vital part of the global economy as immigrants perform scores of less desirable jobs that keep economies moving. “If all the migrants just stopped working now, the Italian economic system would collapse,” said International Organisation for Migration (IOM) spokesman Flavio Di Giacomo, as reported in Time magazine earlier this year. That’s not just hyperbole – the IOM estimates that foreign workers account for 9% of Italy’s annual gross domestic product.
But what goes around comes around. Migration remittance – people sending money home – adds up to billions in revenue and is a surprising but compelling driver within the world financial machine. Just ask Mexico: remittances are the number two source of income after oil exports. This is an essential source of income for the immigrant home country and global coffers were forecast to reach $317bn last year, despite the worldwide monetary crisis. As other sectors of revenue remain volatile, remittance has become a critical financial stream in keeping countries economic structure afloat.
Wealthy developed countries are heavily relying on immigrants as an ageing population is forcing them to deal with unprecedented challenges. In Germany the birth rate has fallen to pre-1946 numbers, raising the question of where the workers of the future will come from. And while social services, healthcare and financial supports are already stressed in several EU nations, the spectre looms large worldwide. Europe is on track to lose 52m workers by 2050, according to a recent Newsweek article, and the magazine also reported in May that the gradually shrinking Mexican population and growing economy will slow emigration to the US in the coming years – right at the time when America is facing its own ageing and workforce crisis. Amazing as it seems, America may soon be actively looking for Mexican immigrants.
Here’s an idea
Pulitzer Prize-winning columnist Tom Friedman argues that innovation will aid economic recovery. Recently he asked Robert Litan, vice president of research and policy at the Kauffman Foundation, how to encourage innovation. The response? “Staple a green card to the diploma of every foreign student who graduates from a US university and push for a new meaningful entrepreneurs’ visa.” Currently a visa for aspiring immigrant entrepreneurs demands $1m of capital – not small change for individual immigrants working on start-up businesses.
In The Next Hundred Million: America 2050, Joel Kotkin prophesies that in 40 years the US will be home to 400m people. In the effort to create new jobs for everyone, Kotkin states, “Immigrants may be one force that will lead the way.” How is that? Figures show that between 1990 and 2005 immigrants started one quarter of all venture-backed public companies and between 1980 and 2000 the number of self-employed people expanded tenfold to make up 16 percent of the workforce. As US employment continues to change focus from reliance on massive corporations to mom-and-pop institutions, self-starting individuals like immigrants will be a major force in business growth.
For innovation to aid the economic recovery it will require openness to new people, ideas and methodologies. This calls for thoughtful immigration plans to encourage the flow of new blood and bring an influx of students to fill universities and entrepreneurs to conceive of new businesses and inventions.
Our urban areas are bulging at the seams – and the fit is going to get even tighter. The economic crisis has already put many urban areas on a forced austerity plan. With government funds running at zero, cities are going to need help. Urban planners and industry need to form new alliances to keep our cities working.
Half the world’s population – 3.5bn – now officially live in cities, but the United Nations Population Fund (UNFPA) predicts that “by 2030, this is expected to swell to almost 5bn… the next few decades will see an unprecedented scale of urban growth in the developing world. This will be particularly notable in Africa and Asia where the urban population will double between 2000 and 2030.”
Marketers must incorporate urbanisation issues (infrastructure, environmental, social services) into their strategic plans and take leading roles in the solution to the rapidly approaching challenge. Cisco is already ahead of the game with its Living PlanIT initiative. The creative collaboration combines complementary skills in technology, research and sustainability focusing on innovation in urban revitalisation, development, operations and community services. Their mission: “To create smart, sustainable communities of the future”. As city populations expand, the fresh ideas necessary to solve the space wars will need to become bigger too.
Migration is a reality of our connected, flat world. To ignore the impact of this massive force is folly. Business and communities need to plan for a continually diversifying market, attract skilled students and experts (foreign or native), find a path for skilled and low-skilled workers, and strategise to replace employees lost to the ageing demographic. Time is ticking so take charge to manage what’s around the corner, today.