A study published in the Journal of Business Research found that shared ethnicity between customers and customer-contact employees affects customer expectations and contributes to a more positive experience.

“Shared ethnicity between customer providers and customers can have a significant impact on the overall experience for the customer,” Detra Montoya, MBA, PhD, clinical associate professor of marketing at Arizona State University’s W. P. Carey School of Business and lead author of the study, told O&P Business News. “We found that shared ethnicity can create a very positive experience for 
customers, and can also lead to a positive outcome in terms of increased loyalty and patronage, and positive word-of-mouth.”

Shared ethnicity

The study was conducted in two parts. First, the researchers administered a survey to customers at a financial services firm, and eligible responses were received from 112 Hispanic customers. The researchers found that respondents demonstrated high levels of identification with their ethnicity and established that shared ethnicity with a customer service provider greatly influenced customer expectations.

The second study investigated the effects of shared ethnicity among Asian, Hispanic and Caucasian customers. Respondents to an online survey, which included 95 Asians, 90 Hispanics and 100 Caucasians, provided written responses to a series of open-ended questions about positive marketplace experiences that could be attributed to their ethnicity and reactions to this experience. Of the Asian and Hispanic respondents, 18.5% said they expected some form of in-group favoritism when dealing with an employee of the same ethnicity, whereas only 6% of Caucasian revealed this.

“In this study, ethnic minorities were more likely to attribute their positive experiences to shared ethnicity,” Montoya said.

Based on the results of these studies, the researchers recommended that service providers who are looking to attract and more effectively serve ethnic populations should hire a customer contact employee who shares the ethnicity of the targeted customer population. However, if this is not feasible, Montoya suggested that business owners try to understand and anticipate customer expectations in order to better serve them.

“We believe that it’s very important for marketers and retailers to try to identify and meet their specific needs,” Montoya said. “Especially in areas where they may be a numerical minority, marketers may need to create a more welcoming environment for their ethnic minority customers, and be aware and sensitive to potential differences.”

This is especially important when dealing with traditionally collectivist cultures, such as Asian and Hispanic ethnicities, which define themselves based on a group and tend to strongly identify with their ethnicity, Montoya said.

“Family and group connectedness is important to customers from a collectivist culture,” Montoya said. “Thus, promoting a group orientation such as shared ethnicity between an employee and customer may be received positively by these customers.”

In-group favoritism

Shared ethnicity can also create in-group favoritism resulting in enhanced service and preferential treatment for customers with shared ethnicity, which could have negative consequences on business practices if employees continually administer free services or goods.

“In terms of some of the preferential treatment or tangible benefits in excess can be very costly for an organization,” Montoya said. “In the first study, we found that customers did have higher expectations of their service encounter when they identified the service provider as someone with which they shared ethnicity. The key is managing those expectations.”

In-group favoritism can also create a sense of alienation for customers outside of the group. Montoya recommended providing clear training and guidelines for employees about standards for preferential treatment of patients or customers. — by Megan Gilbride

Disclosure: The authors have no relevant financial disclosures.