The interview

In the autumn of 2009 the government plans to introduce a new Equalities Bill. What relevance is this legislation likely to have for marketers? What can marketers learn from the views of the people who will have a key role in shaping this legislation?

In this piece, we summarise the opinions of Trevor Phillips, Chairman of the Equality and Human Rights Commission (EHRC), and Caroline Waters, Director of People and Policy for BT, interviewed by the JDDDMP in March 2009.

Why legislate?

Tidying up

According to Trevor, there are at present some 116 separate pieces of statute that deal with, or touch upon, issues of equality. This diversity of legislation has arisen in part because issues of gender, race and disability have been considered in isolation, inconsistently and sometimes in conflict; moreover, their enforcement was, until the formation of EHRC in 2007, the responsibility of different agencies.

As Caroline confirmed, it is impossible for employers to track all of these, to be cognisant of them, and to ensure that each is accorded its proper place in employment practice. Thus, one principal purpose of new legislation is a tidying up exercise, to make the subject matter more coherent, more accessible, more joined-up, more flexible and less bureaucratic.

Changing the culture surrounding discrimination

Outcomes, not box-ticking

Trevor argued that given the myriad times and locations where decisions are taken, and the limited resources available for ensuring compliance, the new legislation would only be successful if it engendered a new climate within which people were mindful of a 'field of expectations', which would ensure that 'the right things happen when we are not in the room'. To this end, the EHRC should shift the focus of its attention more onto outcomes rather than compliance with bureaucratic box-ticking.

Creating a climate

If a climate was to be engendered in which organisations did 'the right thing', rather than merely comply with the letter of the law, then it was essential to improve access to information on outcomes and increase transparency. Caroline cited as an example how influential the publication of information on unequal pay between men and women had been in creating a climate in which salary discrimination on the basis of gender had become culturally unacceptable. It was her opinion that changes in the climate of what was acceptable was most advanced among young people.

Public attitudes to data access and statistical evidence

Privacy vs. transparency

The discussion moved on to discuss the collection and use of data — which, of course, is required for the measurement of the processes and the outcomes of equality-enhancing measures. It was clear that the collection of data was not, on the whole, a serious problem in the UK, where the only real restrictions lay in the Data Protection Act, and that disclosure of data — for example, on pay, which used to be considered a no-go area — was becoming much more open. Discussion followed on the need to hold a balance between privacy concerns and the need for transparency: again pay is an example, as, without transparency, no conclusion about the outcomes of equal pay legislation can be reached.

Getting to the roots of discrimination

Traditionally, much of the impact of current equality legislation occurs as the point when employers recruit new staff. Caroline argued that where a workforce is unrepresentative of a local labour market this is likely to reflect inadequacies or failures in wider society — in education, in housing, in transport. For example, our effort to increase the numbers of ethnic minorities employed in the West End of London needs to take on board the unhelpful distribution of transport links in the capital, which greatly reduces employment opportunities for those living in ill-served localities.

Fairness & discrimination

In many ways, Caroline maintains that employers are being asked to remedy the inequalities that have been created at a much earlier stage: ideally, intervention in the interests of greater equality should occur at the point where it can make a real difference, and we need more spotlights to show up where these points are.

As a consequence of this increased emphasis on 'fairness' and the focus of legislation extending from employment to other sources of disadvantage, the equitable provision of services by commercial companies will come under increasing scrutiny as they have in the USA. Increasingly, commercial companies may have to defend themselves against evidence that their marketing process and distribution strategies compound the disadvantages of groups most subject to discrimination.

'Hard to reach' or 'hard to service'

Servicing the disadvantaged

Caroline criticised a common response of many commercial and public sector marketers in referring to such groups of people as being 'hard to reach' — on the contrary, she said, it was services, not people, that were hard to reach. Many suppliers are prone to not bother communicating with what they assume to be hard to reach groups, failing to recognise that low penetration of their brand or service among these groups may well result from the physical locations from which their services are delivered, inconvenient opening times, the use of inappropriate contact channels or simply the unthinking failure to recognise that different social conventions prevail in different cultures. Evidence of under-use of services by specific disadvantaged groups should lead to the review of service design rather than to the rejection of the group as a viable target market.

The use of the workforce as a target audience

Segmentation of the workforce

Caroline alerted us to an issue that is seldom recognised in the marketing literature, the relevance of market segmentation to communication with the workforce. With 116,000 staff worldwide, 84,000 of them in the UK, BT is one of the growing numbers of large organisations that are applying principles of segmentation to the design of packages of benefits that it offers its different employees. Gender, ethnicity and disability are crucial to this segmentation. Thus, while some might value the contribution the company makes to a personal pension, others would prefer the company to organise a scheme whereby a part of each monthly salary were remitted to relatives in an overseas country. Improvements in the flexibility of working hours also recognise the different interests of male and female workers.

Likewise, Caroline made us aware how useful an employee base could be as a test market for new products and services. The chief lesson was that in regard to technology products people's first concern was with the impact that a given purchase would have on their lifestyle, and that features and functions were relatively unimportant. Ultimately different packages appealed to people with different lifestyles: some of the differences between lifestyles — but not all — were cultural and varied with ethnicity and/or age. Many of them depended on the free choices that individuals made.

The limitation of ethnicity as the sole basis for segmentation

A point that was argued forcibly by both Trevor and Caroline was that marketers far too often imagine that ethnic minority groups are far more homogeneous markets than they really are. In other words, one could not simply categorise people into simplistic silos, like 'Asians' or even 'Asian women'. Lifestyles are just as varied within ethnic groups as they are between them, and just as the lifestyle of an Indian woman or a Chinese woman may be different from each other, so also the products and services that might be of interest to a 50-year-old Indian woman would be very different from those that would be of interest to her 25-year-old daughter.

The use of the recency of migration as a basis for segmentation

Migration vs. ethnicity

Trevor offered the view that segmentation for marketing purposes was still in its infancy: the use of ethnicity in segmentation was rather like the time when marketing discovered the existence of women. He suggested that targeting of recent migrants was often much more relevant than targeting specific ethnic groups as such. The distance people had migrated, how long they had lived where they now live and whether they plan to return to their homeland were important bases for segmentation. An instance of marketing to migrants was Lloyds approach to Polish migrant workers, to present them with simple facilities for such purposes as remitting money to families in Poland.

Many large companies target students as a source of new long-term customers. By contrast, few companies recognise the opportunity presented by recent arrivals, many of whom have limited understanding of how to engage with commercial suppliers of any sort. The difficulty they have in accessing credit is the result of one of the numerous administrative systems the designers of which failed to take due regard of their particular circumstances and needs.

How the UK compares with other countries?

Ethnicity and marketing

How do the attitudes towards the collection of ethnic and other minority data in the UK differ from those in other countries? Trevor regarded Continental attitudes and experiences as totally at variance with the UK — in France, Belgium, Germany — and he believed that in most of Western Europe, collection of such data by the state and its use by government departments was a no-go area. In France this attitude (although President Sarkozy was not of this mind) owed something to the Republican ideal of equality, which regards difference as bad; in most of Europe the effect of the Nazi experience was still a serious factor.

Paradoxically, in much of continental Europe there was a more relaxed attitude to the use of these data by commercial organisations, many of which in the UK are still anxious about public opinion. The USA, by contrast, is well accustomed to the use of ethnic data both in marketing and in ensuring compliance with legislation that requires equality of treatment of different minority groups both by the state and the private sector.

Summary

So what conclusions can we draw, as marketers, from this conversation? First, it is clear that legislation is planned touching on the whole theme of equality — of sex, of ethnicity, of disability; this must touch us first and foremost as employers. It would seem that the primary thrust of this new legislation will be to rationalise and update the mish-mash of existing law, and this can only be welcome. However, a watching brief for any upcoming Bill is required, and on its appearance companies should be prepared to make their views known, directly or through the DMA.

Equal but not identical

Secondly, it would appear that attitudes towards equality are changing significantly: equal treatment need not mean identical treatment. It is clearly no longer the case (if it ever was) that we, as employers or as marketers, should regard every member of society as having the same needs, wants or aspirations. We became accustomed some time ago both in creating products and marketing campaigns targeted at women, or, as our databases became more sophisticated, at particular groups of women, segmented by age, location or income. Today, our supermarkets stock product lines are intended to appeal to the particular tastes of this or that ethnic — or should one rather say cultural — group.

But if, as direct marketers, we are to make our pitch to each and every sub-division of a market, now much more diverse than ever before, we must have the data on which to base our segmentation decisions. Of course, we need to be careful in our use of such data: a man with a clearly Polish name may in fact be a third-generation descendant of a Polish soldier who entered the UK in 1940, and is now as British in habits, tastes or attitudes as Mr Smith next door. However, 10,000 persons with Polish names will certainly include a high proportion of people born in Poland; while it would be a mistake to write to them in Polish, it might be highly profitable to offer them a new biography of Marshal Pilsudski.

Government, national and local, has for some time been collecting data on individuals' ethnicity. After some initial opposition, based on suspicion either of present motivation or the potential for future misuse, this has been widely accepted and gives the government the opportunity to target its services more accurately to those in need of them. As marketers, our ability to collect data of this kind is, for now at least, more restricted, but this too is changing, as people become more willing to part with personal information for perceived advantage.