THE MINORITY UNDERDOG EFFECT

Summary from the TLDR Marketing newsletter

Customers are more forgiving of service or product failures, are willing to pay more, and are willing to give higher ratings when a business is minority-owned. Experiments showed that college students were 18.8% more likely to pay more for a faulty product from a Black-owned business. Minority-owned brands received 19.8% to 35.8% higher ratings than non-minority brands for similar failings. Google Maps data reveals that customers used more positive tones in 34.1% of 4-5 star reviews for Black-owned restaurants. Highlighting minority ownership is most effective when integrated authentically into brand marketing.