Diversity Is a Matter of Business Survival

If you've read any of my previous blogs, you know that I feel strongly, passionately about the financial benefits companies can have from cultural diversity. I also feel that for most U.S. companies doing business in Mexico, they simply do not understand how cultural diversity is hurting their sales and revenues in Mexico. And I'm not the only one telling this story.

Ruben Navarrette Jr., a Harvard graduate, is a syndicated columnist whose editorials can be found in the Sunday "opinion" section of the San Diego Union Tribune, the Los Angeles Times and other leading U.S. papers. An author, radio talk show host and guest on CNN and CNBC, Ruben was recently acknowledged by Hispanic Magazine for his accomplishments. I have to share his most recent article from August 19, 2007 entitled "Embracing diversity will reap big rewards".

Ruben tells of how a few years ago when addressing a group of business managers he didn't launch into a talk about diversity. He felt that it was long past the time when diversity needs to be defended as being a vital part of a company's business strategy. He wrote, "We need to make the case that we shouldn't have to make the case - not in an era of globalization and expanding international markets."

I agree entirely with his comments that with the changing global markets, cultural diversity should not be an afterthought for businesses but rather part of their company strategy. Every company should have a diversity strategy just as they have one for marketing, advertising, sales, etc.

The idea of diversity shouldn’t be a stand alone item either. Diversity should be integrated into every area of a business especially for any firm doing international business. A company can have the best service or product, but that won’t matter if the receptionist is rude to a potential client just because they speak with an accent.

Unfortunately, many U.S. businesses still see diversity as something to look at only after every other area of business is working smoothly. This means never taking action toward diversity. My opinion is that diversity is still something that most U.S. businesses feel is only for the largest multi-national companies such as Microsoft and AT&T. And unlike Microsoft and AT&T, these businesses are not only getting their lunch eaten but sadly, they still don’t seem to notice or care.

The question I got from Ruben's article is “What’s taking so long?!” Many companies need a reality check into what’s happening with business both in and outside the U.S. I applaud my readers that either have established diversity as an important piece of their business strategy or that are working toward making it so.

To those companies whether in the U.S., China or elsewhere that still feel that diversity is optional, I can only say, "Hold on tight." It's going to get a lot hotter in the international kitchen, and many companies may find themselves getting burned.

Richard Villasana
The Mexico Guru


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Addressing Multi-Cultural Training in CRM Magazine

I've been away from blogging for a few weeks while I have been writing articles for U.S. publications. The June issue of CRM Magazine (Customer Relationship Management) carries my latest article entitled "Lo Conseguimos".

Jessica Sebor, former Editorial Assistant, wrote the article "Hispanic Marketing Goes to Universidad" in the magazine's February issue. Hispanics in the U.S. are poised to cross the $1 trillion mark for consumer purchasing power. Jessica highlighted the limited educational resources available within the U.S. on marketing to these consumers.

"Marketing means understanding your customer. For multicultural marketers, this is often a difficult and complex learning process." Jessica wrote. Steven Kelly, codirector for Kellstadt Marketing Center at Dekalb, was quoted as saying, "Essentially, the main thing was business people saying, 'We can't get enough people who understand the Hispanic culture and know marketing.'"

I could not have agreed more with Jessica's article so I wrote a follow up piece. You can read my article here.

It doesn't matter whether a company is trying to market to U.S. Hispanic consumers or consumers in Mexico, Europe or Asia. What does matter is that companies must invest in cultural training to compete and continue to succeed in business at home and abroad.

I wish you continued success.

Richard Villasana
The Mexico Guru


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Blogging - a marketing tool

I am always looking for ways to better communicate with my audience and hopefully have them communicate back. Blogging is one form of marketing that should not be overlooked. Jay Conrad Levinson of Guerrilla Marketing says there are over 100 ways to market but that most companies are using less than five methods. Some companies use only one or two methods to market their company and then wonder why their response rate is so low.

For those thinking to start their own blog, I would recommend the following site. GobalaKrishnan.com is a blog that helps you start your own Internet home business. If you review his blog, he’ll link back to you and send you a ton of traffic. He is also a prolific writer so you will not be wanting for information.

A blog can be set up in minutes. However, to see results will take time and some dedication. It does allow for more informal communication and can be one of many ways to attract attention and interest in your company's products and services.

Whether you decide to blog or not, do review how many marketing methods you are using presently. Strive to implement at least one new method each month and watch your inquiries and sales grow.

Richard Villasana
The Mexico Guru

PS. I also invite you to leave your comments. If there is a topic you would like covered, please let me know.

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An experiment: Exchanging Technorati favorites

I'm trying something new so unless you are devoted to blogging, this particular blog will not help you increase your sales and profits in Mexico. Check back for future blogs.

In an effort to increase visibility of this blog, I am exchanging Technorati favorites. To do this, I am setting up an exchange with DoshDosh.

Those who visit this blog over the course of this exchange will have their blogs faved by me.

Thank you to all who are participating. Thank you to my readers. I will probably have future blogs delving more into this experiment and its outcome and how it may benefit your company.

Richard Villasana
The Mexico Guru

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The Wrong Way to Use a Web Site

Companies need to review the reason they have a web site. Some companies use a web site to brand their product. Others use their site to act as an online brochure of services and benefits. What you do not want to do is simply have a web site with no purpose or one that is simply a one page flyer.

I was looking online for information on products from Dolly Madison. A friend in Mexico had asked about Zingers, a sugary sweet product that has no nutritional value whatsoever but tastes great. Dolly Madison has been around for decades so I would guess they have several products.

So what does Dolly Madison do with their site? Do they list their products with pictures? No. Is there any way for the customer to learn more about the products? No. Is there anything about the site that looks interesting? No.

For Dolly Madison products, it's just one page with shots of two products and a drop down box so you can check out the other affiliates companies. And a contact button. Nothing else. My friend from Mexico commented, "They don't care." That's not the sentiment companies want to foster with potential customers.

I'm certain those of you reading this have put much more energy and thought into your web site than Dolly Madison. If not, now is a good time to look at your site and see if it's being utilized to bring your company maximum benefits and help your business grow.

Richard Villasana
The Mexico Guru

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Technorati - blogging profile

If you are blogging, you should look into registering your blog with Technorati. This is the leading advice from Robert Scoble, author of Naked Conversations: How Blogs Are Changing the Way Businesses Talk With Customers.

To your success.

Richard Villasana
The Mexico Guru



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Marketing - Get the Whole Story

I was reading an article by Dean Calbreath, U.S. to impose some tariffs on Chinese goods.1 The article mentioned figures provided by the local California office of the Department of Commerce (D.O.C.) saying exports from California to China had increased 14% to US$14.6 billion in the last year.

One paragraph really stood out for me where Dean mused over how much imports to California had increased. He commented that state-by-state figures were not included by the D.O.C.

His query touched on an important concern for international companies, the possible bias of the market information they receive. Businesses may rely heavily on government data to determine where to invest their marketing dollars, euro, pound or yen.

Dean's article gives a brief and interesting look at exporting abroad and the subsequent returning imports. I would recommend the article (except it's not online). But more importantly, I would recommend businesses question the market research they receive from their government.

Ask if there may be an agenda or bias to the information that may not serve your company's best interests. Look for contrasting information, and you will have a more complete picture of a country's market for your products and services. Then it won't matter if exports are increasing or decreasing because you'll be working from the powerful position of knowledge.

Richard Villasana
The Mexico Guru

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1. Dean Calbreath, U.S. to impose some tariffs on Chinese goods, San Diego Union Tribune, April 1, 2007.

Don Imus : His Costly Communication Mistake

Some in the U.S. may be tired of hearing about Don Imus, a popular radio talk show host who lost his job last week. However, his situation makes for a sobering object lesson.

It’s sometimes a challenge to demonstrate in monetary terms the negative costs of poor communication and ignorance of a business culture. The Imus event provides a rare glimpse at the financial impact resulting from communication mistakes:1

• Don Imus was so adept at marketing books on his show that the U.S. book publishing industry estimates the loss of his show will impact their industry in the hundreds of millions (US$100,000,000.00) if not billions of dollars.

• CBS received ad revenues of $20 million a year from the Imus show not to mention several millions in syndication fees from affiliated stations.

• MSNBC got hours of cheap programming daily with a huge audience.

• NBC News personalities and others including U.S. Presidential candidates were regular guests on the show where they presented their books to a national audience.

• Preferred politicians received hours of free airtime worth millions of dollars.

• This event will impact Don Imus’ other ventures; his cookbook, his company, Imus Ranch Foods, and a line of environmentally friendly household-cleaning products.

Five seconds and one irresponsible phrase will cost CBS, MSNBC, NBC News staff, book writers, politicians, the publishing industry and Don Imus himself at least US$250 million dollars. His may have been the most expensive five seconds in the history of radio.

This situation demonstrates how poor and improper communication can have devastating financial repercussions. Companies should consider how the lack of expertise about Mexico’s business culture and communication may be adversely affecting their sales and profits.

Richard Villasana
The Mexico Guru

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1. Special acknowledgement to Terry Keenan and his article End of Imus Inc. Will Be a Shock to Publishing.

Don Imus - a Study in Bad Communication

In his article, Don Imus isn't the only one who ought to be ashamed, columnist Leonard Pitts Jr. wrote how Don Imus, a prominent national radio shock-jock, lost his lucrative simulcast with MSNBC and then later his show with CBS because of his "racist and sexist insults against the Rutgers University women's basketball team."1

Leonard went on to write that part of the offending expression by Imus was his use of the word “ho” meaning whore. This word has been popularized for many years by leading rappers such as Snoop Doog who is referenced in the article. Imus may have felt that after all the years of rappers using the word “ho”, this implied it was acceptable for him to use this term during a national radio broadcast. Obviously Imus was wrong.

There are many in the media asking what people will or should take away from this incident. One lesson international business people should definitely take away from this event is the warning to be vigilant about the words they use when communicating with people in another country.

People do not have to use profanity to insult someone from a different culture or country. Speaking informally to Mexican associates without first having developed the proper relations can demonstrate at the least ignorance about the Mexican business culture or worse be viewed as an insult. There may be terms that Mexicans use when speaking with each other. This in no way implies that an outsider can or ever should use the same words without offending someone.

One of the goals for businesses is to communicate their message clearly to the customer. One should always err on the side of caution and formality rather than risk insult and embarrassment. It only takes one misspoken word to cause enormous financial loss. Just ask Don Imus even though it is likely he will be back on the air waves in one form or another. For those of us doing business internationally, however, such a mistake could destroy years of hard work and investment.

Richard Villasana
The Mexico Guru

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1. Special acknowledgement to Leonard Pitts Jr., columnist for The Miami Herald. His article was a source of inspiration.

Provide options for customers to communicate with your company

I was speaking with a woman earlier this week who was having difficulty reaching a business in Mexico. The company's home office is in the U.S. with an office in Tijuana, Baja California. The company's web site only provides links to send an email. No fax numbers or telephone numbers are giving.

After searching the company's web site to ensure she hadn't missed the telephone number, the woman then started searching on-line for the Mexican office number. She finally found the phone number of one of the company's U.S. offices and got the number for the Tijuana office. Obviously the woman really wanted to do business with this particular company and their office in Mexico.

How many of your potential customers would go to such lengths to do business with your company? Many companies, especially in the U.S., have decided that email is the only form of communication they want to offer to potential customers. This is a mistake internationally.

What happened to customer service? It's not customer service to force visitors and potential customers to communicate with a company by just one form. The idea behind customer service is the customer gets to choose and have it their way, not what's convenient just for the company.
Many international customers prefer to talk with someone initially rather than sending an email. For some cultures, email is seen as impersonal and a form of communication to be used only after a relation has been started.

Companies may be making all the right moves when it comes to reaching out to foreign consumers. However, if customers can't communicate with a company the way they prefer, they may simply go find a company that understands quality customer service and makes it easy for the customer to do business.

Richard Villasana
The Mexico Guru

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Cultural Understanding is a Business Weapon

"Military ramps up education on Iraqi culture" read the headline of an article in the February 4, 2007 edition of San Diego Union-Tribune. The article goes on to explain cultural training is part of a new effort to increase troop awareness of Iraqi culture before they arrive in Iraq. A former Marine captain tells Iraq-bound troops that cultural understanding is a weapon.

Why this focus on culture? Jon Alterman of the Center for Strategic and International Studies in Washington, D.C. says that with cultural knowledge, newly arriving troops might be able to prevent some of the most obscene offenses. Many leaders in both the military and government have pointed to the lack of cultural knowledge as a principal obstacle to winning over the Iraqi people.

One Lt. Colonel warned a class at Camp Pendleton, a Marine training camp outside of San Diego, California, "Make sure you're not the bad American who does something to embarrass you, your unit or the Marine Corps."

What does the U.S. military concern and efforts to dramatically improve cultural awareness in Iraq have to do with companies wanting to do business in Mexico? It is a vitally important reminder that cultural knowledge is critical to a company's success in other countries.

Companies wanting to do business in Mexico must examine their internal effort to understand the Mexican culture. Business leaders must ask which employees are or will be interacting with Mexican professionals and if these employees understand the Mexican culture.

Companies must be willing to invest in proper training to ensure that all staff that interacts with Mexican associates has a solid foundation about Mexican culture. Otherwise, U.S. companies risk losing their investment in the Mexican market.

After spending more than half a trillion dollars (US$500,000,000.00), the U.S. military has determined that cultural training is a critical element for their mission in Iraq. Even though soldiers receive only a week or two of intensive training, the U.S. military is already seeing results in key areas. Foreign companies would do well to take note and make the investment so they do not suffer financially in Mexico because of cultural ignorance.

Richard Villasana
The Mexico Guru

*Acknowledgement to Thomas Watkins, Associated Press, for his wonderful article.
February 4, 2007 , San Diego Union-Tribune

Researching the Mexican market

Many messages I receive ask for assistance to find a particular type of business such as medical or computer companies. Often the person will state they want to find these companies "in Mexico".

Here's a potential problem. When someone simply asks to find companies in Mexico, what they are often saying is they have not researched the Mexican market. These professionals believe or "feel" that Mexico is a good market for their company's products or service. However, they may have few hard facts or industry reports to back up this belief about Mexico's market. I'm also making a generalization as if all of Mexico would equally welcome a company's product or service.

U.S. companies may assume that because their product or service is doing well in the U.S., this automatically means they will do well in Mexico. These companies could be correct. Or they could suffer massive losses as Wal-Mart did with the German market.

Wal-Mart is known as a company that does its homework before entering new markets. For whatever reason, Wal-Mart entered the German market without having a clear understanding of the demands and desires of the German consumer. Early on Wal-Mart suffered massive losses. One industry observer commented that Wal-Mart might eventually prevail but only because of the company's deep pockets. Last year, Wal-Mart pulled out of Germany. Imagine the billions of dollars Wal-Mart lost trying to enter the German market.

All companies including those of the U.S. would do well to emulate the example of Japanese businesses. They have a reputation of investing no less than two years to research a market before a sell is ever attempted. For many companies, two years is too long; however, the time spent on researching a market will give huge returns on investment either through increased profits or saving.

Preparation is vital for companies looking to enter the Mexican market. Research will provide guidance on where in Mexico your company should focus. When your company is ready to move forward, you will be working from a position of strength and knowledge rather than from a weaker position of uncertainty. And you'll be able to tell others exactly where you're going in Mexico.

Saludos,

Richard Villasana
Expert on Mexico culture, communication and business practices

Immigrant Plan between Mexico and U.S.

In a press conference held in August 2001, it was announced that a preliminary agreement on an Immigration Plan has been reached between the U.S. and Mexico. Speaking for the U.S., then Secretary of State, Colin Powell, said the two countries would begin talks to form concrete proposals including a program to grant temporary residence to Mexicans working in the U.S.

Mexico's Foreign Minister Jorge Castaneda said the agreement would include protection of "the rights and the benefits Mexicans need - all Mexicans," who are living in the U.S. In 2006, Hispanics became the largest minority in the U.S. with more than two-thirds being of Mexican origin.

Immigration is still a hotly debated topic between the two countries. Escondido, California is just the latest entry into this discussion. The city is attempting to establish legislation that would fine apartment landlords if they rent to illegal immigrants.

Yet despite concerns over immigration, U.S. companies view Mexico as one of the leading markets for their products and services. Mexico is one of the largest economies in the world. Some economists speculate Mexico's economy will surpass that of Canada by the end of 2007.

Smart business owners recognize Mexico as an attractive market with commercial benefits due to NAFTA, the North American Free Trade Agreement. Since the agreement in 1992, trade between the three countries, Canada, Mexico and the U.S. has increased over 128%.

More businesses are being drawn to Mexico for both the economic opportunities and Mexico's young consumer base. These consumers view U.S. made products and services in a very favorable light.

The task now is for U.S. companies doing business with Mexico to develop solid relations with their Mexican associates. Knowing the business culture and how to properly communicate is becoming more important every day as other competitors such as China, Japan and the European Union increase their investment and trade with Mexico.

Companies from these countries are highly skilled in cross-cultural communication. It's up to U.S. companies to enhance and expand their own expertise in cross-cultural communication or risk falling behind the competition.