In January 2017, I wrote a similar post previewing the changes that would eventually happen in the field of Hispanic marketing and why it should be a demographic to closely look at and what brands should be paying attention to generate sales from this group.
Two years later, and two weeks into 2019, using the same idea and the same structure, I would like to share how the demographic have changed and what is projected to reach this ever-growing demographic and why still within a two year span are marketers still not in the ball with this demographic. The numbers are there; their vision is not.
In December of 2016 it was estimated that the Hispanic usage of the WhatsApp alone was 45%. Back then it was projected to increase by 62% (overall usage of smartphones in 2017). Fast forward to early 2019 and by 2018 numbers, although it number varies by education levels and disposable income, it is generally at 77%
What Has Changed?
With several factors remaining constant as income and education levels, the three studies show that there was a consistent annual growth in usage and ownership.
Why is It Still Important?
When it becomes the sole instrument of communication, research, relationship building, entertainment, engagement and purchasing, it will be then the most effective and most productive way to reach them.
Back in 2017, I discussed that geo-marketing and that geo- location would be the way to target not only the Hispanic base but most all markets. Per e-Marketer spending for geo-location ads will top 38.7 billion by 2022, more than doubling 2017 figures.
Given that TV ads and billboards for the most part have been largely replaced by targeted ads directly sent to smartphone devices it is not surprising that this mode of advertising is projected to grow.
English Language Hispanic Targeted Content
What Has Changed?
Language is still important but culture is more. While most 2nd and 3rd generation Hispanics are English proficient and acculturated their connection to their Latin roots is still prevalent and are more inclined to follow, buy, promote and share content that speaks to them culturally and if it is bilingual they are more inclined to share it.
This is a big factor for Hispanics, for most Hispanics who are US born, their affinity to their culture and everything that embodies it, is very important to them, third generation Hispanics value their cultural heritage through food, traditions, family values, and family name. Language came in 7th most important. This is also true when searching online. They search in Spanish for general keywords but research entirely in English. AdWords in Spanish is a good way to go too.
What Has Remained Constant?
Cultural connection and cultural relevance go hand in hand and most often is is defined by language and customs. Because this connection is important to them, language is important and should not be ignored in your advertising.
Cultural connection regardless of foreign born or US born Hispanics, is very important to them because of family’s connection to their homeland. This is ingrained by parents and reinforced by grandparents and although they have adapted or acculturated to US customs, they do preserve and are proud of their Latin heritage. Therefore, ads targeting the cultural relevance or that portray that specific group in a non-stereotypical respond favorably to ads.
Why Is It Still Important?
Hispanics value community and base their choices on other people’s recommendations. As stated above when they feel that brands cater to them they are very willing to recommend and share it with their peers and family.
It is what triggers their desire to purchase. It means that a brand is going the extra mile to understand and resonate with their culture. It furthers their loyalty to the brand and become mayor brand ambassadors to it by sharing and promoting their ads.
What Has Changed?
Latino populations generally concentrated in (link my post) in early 2017 were in The greatest growth in the Hispanic population from 2010-2015 were in the states of California, Texas, Florida, New York, Illinois, Arizona, New Jersey, Colorado and New Mexico
By late 2018, the multicultural population (including Latino and Asian- another growing subgroup) was at 50% in Hawaii, District of Columbia, California, New Mexico and Texas, with Nevada, Maryland, Georgia, Arizona, Florida and New York, where Los Angeles, New York, Chicago, Dallas, Houston and Miami are already a multicultural majority. Not only do more states account for more multicultural populations but that they account for about 50%
Growth by the Numbers
What Has Changed?
- Hispanics’ spending is growing faster than non-Hispanic expenditure. Hispanics led CPG sales growth in 2017 with + 1.0% in $ change vs. a year ago, vs. only + 0.3% growth from Non-Hispanics. (per Nielsen Target Track, Total US xAOC, 52 weeks ending December 2017)
- In 2018 this trend continued with a + 1.8% increase in Hispanic spending YTD vs. +1.3% from Non-Hispanics, a 33% difference! (per Nielsen Target Track, Total US xAOC, YTD ending 4/28/2018)
- Out of 15 different departments within a regular retail store, 13 of them experienced growth from Hispanic consumers vs. only 8 that saw an increase from Non-Hispanic consumers. (per Nielsen Target Track, 37 markets, 52 w/e 4/28/18)
- In 11 of these 15 departments, sales growth with Hispanic consumers outpaced Non-Hispanic consumers’ sales. (per Nielsen Homescan, Total U.S., 52 weeks ending 4/21/18 vs YAGO)
- From a geographical standpoint, Nielsen tracked sales performance in 37 markets. In 76% of these markets, Hispanic consumers’ sales growth was equal or stronger than Non-Hispanic consumers’ sales. (per Nielsen Target Track & Homescan, Total U.S. xAOC, 52 weeks ending December 2017) From Time to add Hispanic marketing… shopping cart. Forbes
Why Is It Still Important?
This is important because the numbers consistently show an increase in expenditure per year. Back in 2017, when the immigration crackdown began there were many articles that (I have a blog post on this subject) that stated that Hispanic consumption and businesses that relied on the Hispanic consumer were suffering mayor losses because many were afraid to leave home in fear or being stopped. These numbers disprove this notion entirely.
With all of this information at hand, what then is the ‘right’ way to reach them? Above all, why would I be interested in giving these facts and figures to marketers? Because to me despite of all this information and facts stated over and over again, there are still have a:
- Blanket approach to selling to them.
- Rely on bad translation and stereotypical images of Hispanics on TV, film, music and ads. (This is where I could really be of help to them)
- The notion that because 2nd and 3rd generation Hispanics are fully bilingual and acculturated, they should be able to understand our system by now.
- Because rather that investing on a largely potential market, they find it too costly to do so because of the large adjustments that take to fully engage the audience in their ads.
Therefore, according to MediaPost the three takeaways that could be implemented in 2019 are:
- You have to implement and address multicultural marketing. Growth means incorporating diversity into your marketing.
- Implementation of diversity and multicultural marketing in all levels from beginning to end.
- They must invest in diversity. Most agencies spend less than 1% on multicultural marketing.
- Human interaction.
- Diversity, Diversity.
So in short, everything is connected to engage them; language, culture, customs, heritage, family and community. Embodying all this factors with a bit of creativity will go a long way with the Hispanic consumer.