1.5 Trillion USD Say “Yes We Can”
“THE U.S. Latino Influence”
As most American firms are trying to tap into the quick-growing Hispanic market, others do not realize its potential. Donald Trump is the perfect example of one of those.
Companies are adapting to a market, which Nielsen estimated in 2012, would have a buying power of $1.5 trillion USD by 2015. According to their research, the number of Latino-Hispanic households earning more than $50,000 USD a year is growing at a faster rate than the general population. This means that the Hispanic population is no longer a sub-segment, but a full market segment that could shake the economy of the country. This market has grown to the extent that if the Hispanic market in the United States were an individual country, it would rank among the top 20 economies in the world, but wait! It is still growing and is expected to increase from 17% of the population to 26% by 2050, according to the Pew Hispanic Center.
Now companies face an interesting challenge, how will they communicate with this market? Well for starters I can give you a hint. Can you guess what that is? If you can´t: Good luck. The answer is Spanish, which by itself it´s not enough, this will have to be accompanied by a lot of research and development. It is quite more complex than that of course, but it is a good start.
Why do I say Spanish and R&D? Some companies have already tried to reach this segment and failed, as it happened with CNN Latino, a year-old experiment that targeted bilingual Latinos with Spanish-language programs in attempt to reach the United States almost 60 million Hispanics. TV stations in big and small cities had signed on to the programming, such as KBEH in Los Angeles and WTAM in Tampa Florida.
Three months before this happened, NBCLatino.com shutdown, another company that attempt to target the same demographic group. These terminations are an indicator of two facts:
- Hispanic/Latino population is so diverse and its interests so varied that it’s difficult to cater to it when seeing as a mere faceless demographic group. Which is the same as thinking that all African-American people or Asian descent/ascent groups like the same. When it comes to crafting television series, clothing lines, make up or news coverage, companies face a tough challenge starting with the fact of not even being sure of which language to use to market their products/services.
- The Hispanic population remains the fastest-growing demographic in the U.S.
10 Hispanic origin groups —Mexicans, Guatemalans, Salvadorans, Hondurans, Colombians, Ecuadorians, Peruvians, Puerto Ricans, Cubans and Dominicans— make up 92% of the U.S. Hispanic population.
Here´s an interesting fact: Only 18 to 20% of first-generation Hispanic immigrants speak English from well to very well, but 93% of their American-born children are to some extent bilingual, according to “Latinos in the New Millennium: An Almanac of Opinion, Behavior and Policy Preference.”
It is to be considered by the marketing departments that most Hispanics hold on not only to their customs and traditions but to their mother tongue, Spanish. That is the reason why established Spanish-language networks like Univision or Telemundo have succeeded in the United States but not only them…P&G (Procter and Gamble) General Motors, AT&T, USbancorp and Kraft, to name a few, are amongst the top Spanish language advertisers in U.S. traditional media and internet since the Latino market in the first quarter of 2012 accounted for 11%, or $2.2 billion, of total e-commerce purchases made across the United States and they are the most active group of people in the United States´ social media such as Facebook and Twitter in the range of 80% compared with 75% of African Americans and 70% of white Americans.
To the before said we need to ad the following facts:
- Hispanics outpace all ethnic groups in mobile data service consumption including music and picture downloads, and at a growing rate.
- Overall, Hispanics are 28% more likely to own a smartphone than non-Hispanic.
- The average mobile phone bill is 8% higher for Hispanics than for the general market.
This has led to an advertising growth increased by 20.7% for the Hispanic market compared to 1.7% of non-Hispanic market.
There are 8 states in the U.S. that have a population of 1 million or more Hispanic residents: Arizona, California, Colorado, Florida, Illinois, New Jersey, New York and Texas.
New proposals in media, such as Fusion, a joint venture between ABC and Univision have learned how complicated this market is. In an article published by adweek.com on March 2014, Fusion CEO Isaac Lee said their team had spoken with thousands of young Hispanics and learned that they weren’t interested in programming that would appeal only to them.
Since 2011 American companies have spent billions of dollars ($5.7 billion just in 2011) on ads targeting the Hispanic market. Some have had a ROI, many of them wasted their money since the corporations may already be reaching Hispanics and not even know it.
So, what is next? Lots of hard work ahead for the marketing departments since specific, strategic segmentation will have to be conducted within this large group, by group, with variables such as ethnic, religion, race, life style etc. translating that into understanding the idiosyncrasy of the Hispanic community. Those trends will increase as the Hispanic population robust and continues gaining in numbers, buying power and political influence.
How many Hispanics currently work directly or indirectly for Trump´s corporations? How many Hispanics vacation in Trump´s hotels and resorts?
*José E. Urioste Palomeque
Merida Yucatan, Mexico
June 30 2015
*José Eugenio Palomeque-Urioste is a Business Intelligence professional in the area of Research and Development. He began his training process in mass media writing scripts for radio programs, commercials and advertising campaigns. Since then, he has written for newspapers, magazines and mass media in Mexico and the United States, ranging from the professional to the editorial and has written 3 fiction novels that have been presented in numerous forums and literary competitions causing much controversy as to its content.