What is the value chain? Simply put, it’s an overarching term for the steps needed to create a product or service. There are a lot of steps to take a product from its first concept to the shelf—production, technology development, and marketing, for example. With so many people filling all these roles, there are many places where race can factor into the processes of a value chain. Racial disparities, for instance, can appear in labor practices, consumer engagement, and marketing and advertising. By understanding how race relates to economic and supply practices, we can better recognize where inequities exist and how they reflect individual outcomes and wealth distribution.
The role of race in the value chain has become a topic of research interest across disciplines. Experts in business, sociology, and consumer behavior examine this relationship from a wide range of angles, studying everything from multicultural marketing strategies to how race can determine a consumer’s shopping experience. The Race in the Marketplace (RIM) Network, co-organized by Sonya Grier, A. Kwame Harrison, Guillaume Johnson, and Kevin Thomas, is dedicated to researching historical and modern interactions between race and marketing. Grier, a professor at the Kogod School of Business, has published articles on gentrification, targeted marketing in the food and beverage industry, and mindfulness in the consumption process. She is frequently named the leading voice on race in the marketplace, and her research shines a light on the role of race and consumer behavior across business disciplines.
One way that race appears in marketing processes is through market segmentation—the division of consumers into small groups for targeted marketing strategies. Marketers often use gathered demographic data, including race, gender, age, and marital status, to drive messaging in advertising. If done well, this can result in culturally sensitive marketing that recognizes different groups’ preferences. If done poorly, however, it can reinforce stereotypes or contribute to the idea that cultural groups are a monolith. Additionally, segmentation stems from existing data, meaning that if groups aren’t represented in said data, they can be underrepresented or excluded entirely from certain markets.
Demographics don’t only factor into how advertising is segmented and targeted; they also appear in advertising itself. In recent years, there has been a greater push for inclusivity in advertising; however, this inclusivity can be undercut when not paired with a concrete commitment to racial equity. For instance, if a company with inclusive advertising lacks (or rolls back) company-wide diversity and inclusion initiatives, consumers are more likely to view its marketing as performative. Even well-intentioned inclusive branding can have unintended consequences; Kogod professor of marketing Khalia Jenkins’ thesis research explored the impact of labeling products as created by Black-owned businesses and discovered that the label can sometimes have an adverse effect. These patterns reflect the need for a strong understanding of your audience and brand communications that accurately reflect a company’s values.
Digital marketing has changed the landscape of how products and services are advertised, and introduced new considerations. Marketing strategies often incorporate algorithms and data to personalize advertising, and artificial intelligence is accelerating how ads are targeted to individual consumers. However, these algorithms and AI models are trained on data, and biased datasets can skew the results. This can happen intentionally and due to oversight; if a dataset lacks representation from certain groups, the model will come to more skewed conclusions. As AI usage becomes more sophisticated and widespread, it will remain important to ensure that new tools are trained on accurate, inclusive, and properly vetted data.
Interested in learning more or getting involved with race and marketing research? Following experts in the space and research networks like the RIM Network is a great way to keep up with the discussions happening in this space. If you’re seeking an academic route, you can take university coursework in both business and sociological disciplines and engage with faculty who research diversity and consumer behavior in marketing; the Kogod School of Business offers several marketing courses that explore this intersection, including Race in the Marketplace and Marketing for Social Change.