Images: Think Hispanic – Why Hispanics in the US Represent a Unique Opportunity for Brands Infographic
Since the early part of 2000 there has been an emerging necessity for businesses to produce culturally relevant content and campaigns that specifically target the growing population and capture the “new and untapped” market—the Hispanic community. According to Economist.com, “one in every six Americans is Hispanic.” and “…ignoring the Latino tastes is equally daft…” Over the past 15 years we have seen a drastic shift in the U.S. markets in which Hispanics have gained the upper hand in purchasing power. It is estimated that by the end of 2015, Hispanic purchasing power will reach a total of $1.5 trillion in spending. The Hispanic community now has an increasing influence on American culture in regards to business development, marketing, media and digital communications. However, even with the growing population and purchasing power that has been accumulated, companies are still finding they are unable to truly connect with the people and hone the skills needed to market effectively.
Smart marketers recognize that not only is it essential to produce culture specific content for brand recognition, but it will also provide understanding of commonalities and variances between bilingual, bicultural and monolingual individuals.
As of July 2013, it is estimated that Hispanics represent 17% of the United States population, which is equal to 54 million people. As of 2015, that number has increased by 4 million and has been forecasted by the U.S. Census Bureau, to steadily increase by 74 million more (give or take a little bit) until 2060. Clearly this speaks volumes of who is becoming the growing majority in the United States and where the market is shifting.
One thing to note—Armando Azarloza, president of The Axis Agency, states “embracing American culture does not strip Hispanics of their heritage or render them susceptible only to mainstream marketing influences”, what does this mean? The statement from Azarloza is meant to show that Latinos are not a culture that can be encompassed by the “blanket marketing effect” that has been practiced for many years (although successful) with the other 262 million people in the United States. Hispanics are a people who pride themselves on hard work, values and most importantly, their heritage—simply changing words from English to Spanish in an ad campaign and thinking that it will motivate the Hispanic community to buy your brand will not work. It’s about making that honest connection and showing a genuine understanding of the community and culture that will drive traffic.
Something to consider—algo que pensar
In an article published Forbes.com entitled “Why Brands Need to Understand the Nuanced Differences in the Hispanic Market”; Forbes segments the Hispanic market into three classifications: Settlers, Uproots and Hybrids. Settlers are defined as first generation immigrants (1.0-1.5 generation). They have lived 50%-75% of their lives here in America but hold strong to their cultural heritage. Uproots are those who have not become totally proficient in the English language, are tentative in embracing American culture and find solace in their own customs. Hybrids however are more “acculturated”. Hybrids are (like me) second generation born, bilingual, bicultural and bi-literate. They are the growing segment of the Hispanic population and have been influenced by the American and Hispanic cultures throughout their lifetime. They possess the most persuasive behaviors of the community, are more likely to obtain an advanced education and are aware of politics and social issues facing both cultures. A smart marketer will be able to understand the challenges facing a person in each segment but is still able to generate the best plan to reach each individual without creating isolation.
Represent me, don’t sell me—the figures and Hispanics in the digital market
“U.S. Hispanics are ahead of the curve when it comes to digital. They lead in adoption of new devices. They are power users of mobile and over-index in video consumption. But despite the facts, these consumers are vastly underserved, and the opportunities to reach them through digital remain largely untapped.” —Lisa Gevelber, Think with Google
As I stated earlier, Hispanics currently represent almost 20% of the current population in the U.S., most of which are now second and third generation. What this means for marketers is that over time, current and future generations of Hispanics are becoming more gentrified and acculturated to advancements taking place—more so with digital platforms like social media, vlogging and communication apps. Larger social companies like Google, Facebook, YouTube and even production companies like Universal Pictures have taken notice of the flourishing opportunities and are working accordingly to understand the nuances and capitalize on the Hispanic market.
Here are some facts:
- Hispanics are now 17% of the population and is expected to grow to 128 million in the U.S. by 2060
- Estimated to reach $1.5 trillion in purchasing power by 2015
- 90% of internet penetration is based on Hispanic usage
- 58% of all Facebook users are Hispanics and provide relevant content that drives traffic
- On average, Hispanics spend 90 minutes longer on video sites such as YouTube or Vine vs. non-Hispanics
- 93% of Hispanics use their smartphone to access the web and maintain social sites and produce content on each
- Although we buy less often, 56% of Hispanics tend to spend more on purchases at a single time—mainly through the web
The bottom line—major companies and media outlets have come to the realization that Hispanics are not only a large portion of their audience, but also play an intricate part in their success. As an example, Universal Studios captivated audiences with the release of the adrenaline-packed “Fast & Furious” movie series. They dominated the box office with the films that maintained a largely Latino cast. In turn, the movie gained a huge following with the Hispanic community; so-much-so that Universal Pictures released a “prequel” to the films on YouTube targeting the community by touching on language and culture. The prequel shows actors in Latin America, eating the food, exploring the culture and touched on “Spanglish”—a combo of English and Spanish.
¿Me oyes? Do you hear me?—communication and language
“Latinos will choose which brands to give their money to based on a brand’s ability to effectively communicate” —Joe Gutierrez, Managing Director at Pinta NYC.
Take comfort in reaching out. Brand and companies need to find security in reaching out to the Hispanic consumer even if that means they don’t get it right the first or even second time. In order to create comradery, brands need to incorporate content that shows relevancy to the community. Creating campaigns that have been simply translated into the language will not suffice. Studies show that Hispanics will continue to maintain a working relationship with brands that consistently show genuine interest in the community, produce content that is relevant to the culture or heritage, reflect social issues and of course integrate the Spanish language. The truth is the same not only for Spanish speakers, but those who are bilingual or are of Latin decent who many not speak the language fluently.
Engagement is all about appreciating the voice of your consumer and showing that they are a voice that matters to you.
Cultural Relevancy—the impact on brands and media
Cultural relevancy goes a long way. Having a true, valid understanding of what makes a culture tick and the potential it has to create a positive change is important. Many brands have recognized this potential and invest a lot of time and money to show their gratitude and appreciation. For companies like Pepsi, McDonald’s and media stations, the Hispanic community was never the next big thing, but an opportunity to embrace a culture.
Pepsi who, in 2014 decided to reestablish its commitment to the Hispanic community, created the Viva Hoy campaign. The company sought to rebrand their image to the community because according to their senior-director of cultural branding, a large portion of growth in the beverage business comes from the Latino community. The campaign Viva Hoy “live for now”, featured content and commercials with Latin television, movie and music stars that fully endorsed the product giving it the stamp of approval and generating over $30 million in ROI.
Major quick service restaurant McDonald’s, has embraced the Hispanic culture every year during Hispanic Heritage Month (September 15th – October 15th). During that time, the company celebrates the Hispanic community through college and health fairs; bringing awareness to social issues, parades and fundraising.
On the media side we have seen a great shift to where Hispanics now dominate cable and network TV, award shows and radio waves. One of the most influential people in television right now is the very funny Latina Sofia Vergara. Not only beautiful, it is great to know that she has a mind for business and cultural marketing as well. In 1994, Vergara opened Latin World Entertainment (LWE), the premier Hispanic talent firm and marketing agency. The agency specializes in working with companies around the world to embrace culturally relevant content and scout talent that appear on broadcast stations such as ABC, NBC and CNN.
See what happens when you open up.
Although these markets have been segmented to gain a richer understanding of how to market, one thing remains the same—no matter what classification is placed on the community; they are all one in the same—people that value the culture, their heritage and keep a strong link to values that have been passed along.