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Transcript of "Nielsen-african-consumer report"
1. REPORTTHE STATE OF THEAFRICAN-AMERICANCONSUMERSeptember 2011
TABLE OF CONTENTS About the Report .................................................................................................... 1 Executive Summary ................................................................................................ 1 Letter From National Newspaper Publishers Association Chairman ................2 Letter From Nielsen Vice Chair ............................................................................ 3 Section One: “Our House”—Demographics ....................................................... 4 Population Trends .............................................................................................4 Income ...............................................................................................................6 Education ........................................................................................................... 7 Marriage and Divorce Rates .............................................................................8 Children..............................................................................................................9 Section One: Opportunities .............................................................................9 Section Two: What African-Americans Watch .................................................. 10 Television Viewership ..................................................................................... 10 Mobile Phones ................................................................................................. 12 Trends in Advertising Spend and Effectiveness ............................................ 14 Online .............................................................................................................. 16 The Movie Screen ............................................................................................ 17 Section Two: Opportunities ........................................................................... 17 Section Three: What African-Americans Buy .................................................... 18 Buying Power................................................................................................... 18 Shopping Habits .............................................................................................. 19 Store Channel Frequency ............................................................................... 19 Buying Habits ..................................................................................................20 Section Three: Opportunities .........................................................................20 Summary .............................................................................................................. 21Cover Photo Credit ©iStockphoto.com/Stalman
ABOUT THE REPORT It is important for marketers to recognize and understandThis report, the first of three annual Consumers should look to use this the full diversity of theinstallments, attempts to provide a information to analyze their collectivefairly complete picture of the African- preferences and to understand the Black Population.American consumer. The compilation of influences they have on media and thethis information in one place represents marketplace. Secondly, they can use Businesses can use the information to makean effort to understand an important and the report to understand the economic a greater investment in African-Americanflourishing market segment. The report relationship their patronage and buying communities and to expand their marketprovides in-depth and exciting insights power has on business. share with a demographic group that hasinto the demographic changes occurring high growth potential and above averagewithin the African-American population as brand loyalty buying behavior.well as some of their buying behavior andmotivating influences. African-American or Black? 88.8% African-American It is important for marketers to recognize and understand the full diversity 7.5% West Indian of the Black population in the United States. African-Americans represent the majority (89%) and are a driving force in the Black community. The 2.1% Sub-Saharan African U.S. Black population includes those that describe themselves as Black; all 0.8% Central American nationalities that represent the Black Diaspora, (for example those who are 0.4% Asian Jamaican or Nigerian); as well as persons who define their racial background as a combination of Black and another race. For the purposes of this report 0.3% Black Hispanics we are using the term African-American to describe the Black population.EXECUTIVE SUMMARYIn more than 100 countries around the growing diverse base, Nielsen—along and income. The collective buying powerworld, Nielsen provides clients with the with the National Newspaper Publishers of the African-American population ismost complete understanding of what Association (NNPA)—has developed this projected to be at $1.1 trillion by 2015.consumers watch and buy. As business report to better illustrate the qualities Collectively the group over-indexes inexecutives look for opportunities to grow of the African-American community, the several key categories (television viewing,their companies and gain market share business opportunities that exist, and the mobile phone usage and trips to groceryit is critical that they understand new best methods for a productive connection channels) and exerts a large influence onand emerging demands from consumers, between businesses and this community. popular culture and trends, indicative ofespecially within growing segments, the high growth industries of the future. The African-American population is,wherever they do business. As the The three areas we have chosen to focus today, the largest racial minority grouppopulation of the United States evolves on for this report include a review of in America, with a population of closeto become more ethnically diverse, the demographic characteristics, a survey of to 43 million. This market segment’scomplexity of such an effort has grown. the programs and mediums favored by growth rate continues to exceed theTo help close the gap and give insight the group, and a look at overall consumer overall population’s growth and is makingas to how to address the needs of the packaged goods buying behavior. continued gains in the area of education Copyright © 2011 The Nielsen Company. 1
When Nielsen has a stable and reliable base of participants, it ensures they can provide major corporations with the most inclusive and comprehensive analytical insights, trends and forecasts possible.Letter from Cloves Campbell, We have chosen to collaborate with Nielsen and focus on the African-Chairman, National Newspaper American consumer because of the growing economic potential of our community andPublishers Association (NNPA) the opportunity for more focused marketing efforts across Fortune 500 corporations. Too often, companies don’t address the inherent differences of our community, are not aware of the market size impact, and have not optimized efforts to develop messages beyond those that coincide with Black History Month or other traditional themes. Once we learned of the powerful analytic insights Nielsen has about our community, we knew we couldn’t keep it to ourselves. Throughout history the Black Press has been “the voice of the Black community.” If a story or event of concern to our community has not been reported or commented on in our papers, then it must not be relevant. As Black radio ownership has diminished and television programs of African-American content continue to disappear, the Black Press is now more relevant than ever before and is still the most effective way for reaching millions of African-Americans because they trust us. It’s a trust we’ve spent more than a century building and by inviting Nielsen to collaborate with us, it’s a transferable trust. With this report Black business operators and owners, local and national civic and legislative leaders, as well as everyday consumers can see at a glance the power of their purchasing decisions and habits and determine how to better harness that power. Our collaboration with Nielsen is important because it helps raise awareness of the importance of multicultural participation in their studies, panel and surveys. When Nielsen has a stable and reliable base of participants, it ensures that they can provide major corporations with the most inclusive and comprehensive analytical insights, trends and forecasts possible. It is our hope that such knowledge will lead businesses to better understand and engage with our communities to develop stronger business plans and marketing strategies that will increase their market share, and ultimately their revenue, in industries and categories with the highest sales potential for African- American consumers. If you are one of the 19 million readers who has received a copy of this report through your local NNPA publication, we trust that you will remember it was Nielsen and the Black Press that brought this information to your doorstep. We encourage you to share it with others and use it to guide your expectations when determining what companies are deserving of your hard earned dollars. Cloves Campbell2 Copyright © 2011 The Nielsen Company.
Nielsen owes much to our devoted external African- American Advisory Council members who urge us to, tell the Black consumer story!Letter from Susan Whiting, On behalf of Nielsen, it is my pleasure to present this report showcasingVice Chair, Nielsen the buying and media habits and consumer trends of African-Americans in the United States. This report represents the multi-year alliance Nielsen has with the National Newspaper Publishers Association. As part of this alliance, Nielsen is committed to developing a new report each year for the next three years. Our alliance with NNPA provides us the opportunity to distribute the valuable insights contained within these pages to readers of NNPA’s 200 member publications. The objective is to create a single, comprehensive report that can be used to document important data, trends and insights on this very key market segment. In remarks made to a group of clients earlier this year, Nielsen CEO David Calhoun stated, “Understanding and promoting diversity is critical to our business because it enables us to better meet the needs of our clients.” One of my priorities is to advance this mandate to help our clients respond to the challenges and opportunities that arise as the face of America changes. The best way we can do that is to provide them with a holistic overview of an audience that has incredible purchasing power. Likewise, this report, and the bi-weekly column that appears in local NNPA newspapers across the country, gives Nielsen the chance to communicate a clear picture of African- American buying power. It is our hope such information is helpful in shaping the informed decisions consumers make about the companies they want to support. Nielsen owes much to our devoted external African-American Advisory Council members who urge us to, “tell the Black consumer story!” As prominent leaders of industries and communities across the country, they have long touted the value of sharing these insights. We hear their passion and appreciate their vision and foresight. We hope that you find this report to be the valuable personal and business tool that we’ve intended it to be. Susan Whiting Copyright © 2011 The Nielsen Company. 3
SECTION ONE:“OUR HOUSE”—DEMOGRAPHICS“Our House” represents the demographic characteristics of the African-American community. In order to trulyunderstand the impact and market potential of this community, we must first identify some key qualitiesthat define its character. “Our House” specifically looks at population trends, household income, educationalattainment, and the household dynamics of the community.Population TrendsThe African-American community makes African-American % of U.S. Population 14.2%up 13.6% of the population of the UnitedStates and is projected to reach 14%over the next 10 years. This equates to 14.0%populations of 42,071,000 and 47,587,000 13.8% 2025for 2010 and 2020, respectively. Thegrowth rate for African-Americans 13.6% 2020outpaces that of the total population 13.3% 12.9%by almost 30% and reflects not only an 2015increase in people, but also their affluence 2010 2000 2005and influence.The average age for African-Americans Source: U.S. Census Bureau, Census-Based Projectionsis 32.1 with more than 47% under theage of 35. African-Americans and otherminorities make up a large percentage ofthe United States’ younger population. The Minority Population Skews Much YoungerThese young Americans represent a higherpercentage of future minority consumersand customers. They may have different Under 12 56% 22% 16% 5%perspectives than those traditionallyconsidered when making marketing and Population Age by Ethnicityproduct development decisions. Marketers Ages 12–17 60% 18% 17% 5%should be aware of these differences inorder to tailor their messages properly.The African-American population is Ages 18–34 60% 19% 14% 6%younger than the overall national averagebut slowing birth rates and increases inthe median age of the group indicate an Ages 35–54 68% 13% 12% 5%aging trend. Ages 55+ 79% 7% 9% 4% White Non-Hispanic Hispanic Black/African American Asian Source: U.S. Census4 Copyright © 2011 The Nielsen Company.
The African-American population,as a percentage of total population,is concentrated in the Southeastern Top 10 Designated Market Areas Top 10 Designated Market Areas (DMAs)states, the major urban areas in the (DMAs) by African-American TV by % African-American TV HouseholdsNew York to Washington, D.C., corridor, Householdsmajor industrial cities in the Midwest, Designated DesignatedHouston and Dallas in Texas and Los Black TV Total TV Black TV Rank Market Area Market Area % BlackAngeles, California. Although the African- Homes Homes Homes (DMA) (DMA)American population continues to havehigh concentrations in cities, over the 1 New York 1,256,380 Greenwood- Greenville 69,450 40,300 58.0%last ten years census population trendshave shown dispersion to suburban areas 2 Atlanta 664,860 Jackson, MS 338,030 148,610 44.0%and warmer regions of the country. Oneexample of this trend is the Atlanta 3 Chicago 589,240 Montgomery- Selma 244,470 101,530 41.5%region. African-Americans living in thecity have shown a decline of 8% while the 4 Washington, DC (Hagerstown) 571,980 Memphis 693,860 268,620 38.7%surrounding suburban areas have seen 5 Philadelphia 551,070 Meridian 72,280 26,810 37.1%an explosive 40% increase in African-Americans. Another example is Chicago 6 Los Angeles 475,180 Columbus, GA (Opelika, AL) 219,450 80,050 36.5%which saw a decline in 180,000 African-Americans living in the city and a decline 7 Detroit 378,730 Macon 241,120 87,050 36.1%of 3.5% in the entire metropolitan areapopulation. These migrations are likely 8 Houston 377,960 Columbia, SC 405,670 144,170 35.5%due to a combination of demographic 9 Dallas- Ft. Worth 368,640 Augusta-Aiken 257,030 90,140 35.1%trends including higher incomes and agingwhich have led to a movement out of 10 Raleigh-Durham (Fayetteville) 302,670 Albany, GA 156,910 54,470 34.7%cities for more services, better educationalopportunities and warmer climates for aneasier life style.2010 U.S. African-American Population% Penetration by County % Penetration High Low Copyright © 2011 The Nielsen Company. 5
The number of households earning $75,000 or more has grown by 63.9%IncomeAfrican-Americans have experienced Household Incomea transition in the mix of household African-American Households Total Householdsincomes over the last census cycle. The 2000 2009 Change 2000 2009 Changetransition is marked by an increase in < $25K 5,226,713 5,287,171 1.2% 30,261,220 28,066,226 -7.3%higher earning households. Specifically,between 2000 and 2009, the number $25K–$50K 3,504,636 3,700,433 5.6% 30,965,514 28,509,867 -7.9%of households earning $75,000 or $50–$75K 1,796,867 2,082,128 15.9% 20,540,604 20,840,835 1.5%more grew by 63.9%, a rate 11.7% $75K–$100K 797,301 1,133,646 42.2% 10,799,245 13,686,950 26.7%greater than the change in the overall $100K+ 698,449 1,318,060 88.7% 12,972,539 22,512,351 73.5%population. Additionally, the percentage Total 12,023,966 13,521,438 12.5% 105,539,122 113,616,229 7.7%of households earning $50,000 or less has Source: U.S. Census Bureaudecreased, representing a full shift upwardin the income of the overall community.The combination of a growing populationand higher household income reflectsthe opportunity to access an increasingnumber of consumers with a buyingpower of nearly $1 trillion annually andprojected to reach $1.1 trillion by 2015*—due to trends in education and a risingnumber of professional African-American ©iStockphoto.com/goldenKBgoldenKBwomen in the work force. 64% of African-American women are in the U.S. laborforce compared to 60% of non-African-American women. With a buying Rank*** Country GDP (purchasing power parity) (Billion $) power of nearly 1 United States 14,660 2 $1 trillion annually, China 10,090 3 Japan 4,310 4 if African-Americans 5 India Germany 4,060 2,940 were a country, they’d 6 Russia 2,223 7 United Kingdom 2,173 be the 16th largest 8 Brazil 2,172 64% of African-American 9 women are in the U.S. country in the 10 France Italy 2,145 1,774 world.** 11 Mexico 1,567 labor force. 12 Korea, South 1,459 13 Spain 1,369 14 Canada 1,330 15 Indonesia 1,030 16 Turkey 961 17 Australia 882 * Source: Target Market News, “The Buying Power of Black America.” 18 Taiwan 822 ** If comparing buying power to Gross Domestic Product (GDP), defined as the value of all goods and services produced within the 19 Iran 819 geographic territory of an economy in a given interval, such as a year. 20 Poland 721 *** Source: Index Mundi6 Copyright © 2011 The Nielsen Company.
EducationThe African-American community has These higher growth rates and larger Increasing educational achievement andseen growth in educational achievement numbers of achievers could seem other factors have started to significantlyat all levels, including high school, college, somewhat surprising as oftentimes the raise the community’s affluence and couldand graduate schools. Adults over the discussion about African-Americans and possibly increase market growth withage of 25 have seen a higher positive education is centered on concerns such viable products and services related to thispercentage increase in educational as subpar urban schools, high drop out market sector.attainment than those in the overall rates, and lack of collegiate preparationpopulation. In addition to more high and access. These growth statistics doschool diplomas and equivalency not make those discussions inaccurate ordeterminations over the census cycle, eliminate the need for improvement, butthe percentage of African-Americans they do illustrate that the community hasattending some college or attaining a seen positive results in education—anddegree has grown for both men and that message needs to be reinforced. ©iStockphoto.com/RichVintageRichVintagewomen from 39.6% to 45.3% and44.9% to 53.6%, respectively. Whileboth genders have done better, most ofthe achievement growth can be attributedto significant gains by African-Americanwomen. Additionally, based on 2000 to Educational Attainment Persons 25+2009 statistical comparisons: African-Americans Total1. In 2009, 81.4% of African-American 2000 2009 Change 2000 2009 Change adults had attained a High School Male Diploma or GED compared to 72.3% Less than High School 29.1% 20.0% -9.0% 19.9% 15.5% -4.4% in the year 2000. High School or GED 31.4% 34.7% 3.3% 27.6% 28.6% 1.0%2. In 2009, 17.6% of African-American Some College 26.5% 29.7% 3.2% 26.4% 27.5% 1.1% adults had attained a bachelor’s College Degree+ 13.1% 15.6% 2.5% 26.1% 28.4% 2.3% degree compared to 14.3% in the year 2000. Female Less than High School 26.6% 17.4% -9.2% 19.3% 14.1% -5.2%3. In 2009, 6.1% of African-American High School or GED 28.4% 29.0% 0.6% 29.6% 28.4% -1.2% adults had attained a graduate degree Some College 29.7% 34.3% 4.6% 28.2% 30.1% 1.8% compared to 4.8% in the year 2000. College Degree+ 15.2% 19.3% 4.0% 22.8% 27.4% 4.6% Source: U.S. Census Bureau Increasing educational achievement and other factors have started to significantly raise the community’s affluence. Copyright © 2011 The Nielsen Company. 7
Marriage and Divorce RatesSimilar to the decline in the prevalenceof marriage in the overall population, thepercentage of married African-Americanshas continued to decline. For the African-American demographic, the decline isevidenced by two factors: a growth inthe number of people who have nevermarried and an increase in the medianages of both men and women for theirfirst marriage. These changes within theAfrican-American community have beenproportionately more dramatic than inthe total population. Those who havenever married grew by 1.7% more and themedian age for first marriage is 30.4 and30.0 for men and women, respectively, ©iStockphoto.com/digitalskilletcompared to 28.4 and 26.5 for the totalpopulation.Some of the marriage effect within theAfrican-American community may beexacerbated by the higher achievementsin education and in employmentsuccess (indicated by higher householdincomes) especially by women within thisdemographic. Marital Status for Persons 25+Regardless of the specific reasons, it African-American 2000 Total 2000is clear that fewer people are gettingmarried or are remaining single well into 43.4% 63.1%their adult years. Company executives 14.1% 6.3% 11.6%and marketers should be looking toaddress these changes by highlighting 27.4% 8.8% 14.8% 8.0% 2.5%their products and services to a growingpopulation of single adult or non-married African-American 2009 Total 2009households. 35.1% 19.0% 7.5% 7.4% Marketers should 14.9% 5.6% 2.5% 36.9% 58.3% 12.8% look to highlight their products and services to Married Never Married Divorced Widowed Separated a growing population of single adult or non- married households.8 Copyright © 2011 The Nielsen Company.
ChildrenAlthough the overall demographictrend of minorities in America tends tobe concentrated in the under-35 agemarket segment, there is evidence of adecline in the percentage of householdswith children in the African-Americancommunity. The number of householdswith children is declining at a higher ratethan is occurring in the overall population. SVLuma/Bigstock.comWe can probably attribute somecorrelation between fewer children perhousehold and the growth in educationattainment and the decline in marriedcouples. Moreover, the birth rate forAfrican-Americans has slowed causingincreases in the median age of African- Households by Number of ChildrenAmericans. Number of African-Americans Total Children 2000 2009 Change 2000 2009 Change 0 61.6% 66.3% 4.7% 67.0% 69.7% 2.7% 1 16.7% 15.3% -1.4% 13.6% 12.8% -0.8% 2 21.7% 18.4% -3.3% 19.4% 17.5% -1.9% Source: U.S. Census BureauSECTION ONE: OPPORTUNITIES Consumer Leverage your Business Don’t Opportunity: buying power. The Opportunity: underestimate African-American the buying power. population has a buying The number of African- power of nearly $1 trillion. This American households earning figure is larger than the GDP of most $75,000 or more has grown by countries in the world. Collectively, 63.9% in the last decade, a rate consumers can use this information greater than that of the overall to leverage relationships with population. This continued growth companies wishing to grow market in affluence, social influence and share in this area. household income will continue to impact the community’s economic power, especially with women, who tend to be the primary decision makers for most household buying decisions. Copyright © 2011 The Nielsen Company. 9
SECTION TWO:WHAT AFRICAN-AMERICANS WATCHAs society becomes increasingly digitized, consumers engage with different forms of content in a variety ofways. While the television continues to be the number one way viewers consume video content: computers,smartphones and tablets are rapidly expanding platforms for consumers to interact with media. As we analyzewhat the African-American population is watching, it is important that we also identify how they receive it.Focusing on both the content and the method of interaction provides insight to advertisers, content providers,manufacturers, and device makers as to how to get their messages and products to the public.Television ViewershipAmerican usage of television is still televisions—coupled with cable television, African-Americans watch more televisionstrong even with alternatives such as satellite television, video game consoles, than any other group. Not only does themobile phones and high-speed Internet. on demand systems, high-definition average African-American household haveThe television still maintains many content, and digital video recording four or more televisions, but also spendscompetitive advantages over the other (DVR) and playback options—still hold a an average of seven hours 12 minutes eachcontent streaming options. The general dominant position with most Americans. day—or 213 hours per month—watchingsize, speed, and low maintenance of them. This amounts to about 40% more viewing time than the rest of the population.Top 10 Most Watched Among African-Americans, Ages 2+ Excluding Sports, Specials, Award andIncluding Sports Variety Programs Award ProgramsJanuary–June 2011 (In Millions) January–June 2011 (In Millions) January–June 2011 (In Millions)Rank Program Viewers Rank Program Viewers Rank Program Viewers 1 FOX Super Bowl XLV 12.53 1 Young and the Restless 1.59 1 Grammy Awards 4.08 2 FOX Super Bowl Post-Gun 11.10 2 Criminal Minds: Suspect 1.52 2 BET Awards Show 3.86 3 FOX Superbowl XLV Kickoff 7.69 3 CSI: Miami 1.46 3 BET Awards 11 Afterparty 3.674 FOX Super Bowl Post Game 7.59 4 NCIS: Los Angeles 1.44 4 BET Awards 11 Pre-Show 2.56 5 AFC Championship on CBS 7.36 5 106 & Park 1.43 5 Academy Awards 2.51 6 NBA Finals on ABC-Game 6 7.14 6 Apprentice 11 1.35 6 Oscars Red Carpet Live-3 1.88 7 FOX NFC Championship 6.91 7 Criminal Minds 1.34 7 Billboard Music Awards 1.58 8 NBA Trophy Presentation 6.64 8 NCIS 1.28 8 42nd NAACP Image Awards 1.52 9 AFC Champ Post Gun on CBS 6.43 9 Law and Order: SVU 1.25 9 Kid’s Choice Awards 2011 1.0810 AFC Div Playoff—Post-Gun-Su 6.31 10 Secret Millionaire 1.23 10 Peoples Choice Awards 1.07Persons Ages 2+. All Day Parts. Live+7. Excludes breakouts, repeats.When gauging the preferences and habits of television viewers, Nielsen measures all households proportionately according to population estimates. For example, the African-American populationof the United States is 14%, therefore Nielsen strives to ensure the number of African-American households in its television sample is 14% as well.10 Copyright © 2011 The Nielsen Company.
African-American households tend genres could be their diverse offering ofto prefer premium cable channel multicultural players, contestants and African-Americanprogramming, drama, live or reality cast members. households set a record fortelevision program and sporting events. the number of sports viewers for Aside from DVR playback, marketers this year’s Super Bowl XLV:The 12.5 million African- Americans might want to note that African-who tuned into Super Bowl XLV, vs. the Americans exhibit higher usage levels 12.5 million vs.11.2 million who watched the previous for watching live TV, DVD playback, and 11.2 last year.year, helped make it the most watched video game usage. It is likely that theSuper Bowl ever. It ranks as the #1 Most lower DVR or time shift playback usage Source: African-American, Hispanic and Female Viewers HelpWatched Show for African-Americans for levels correlate to the high live TV usage, Drive Super Bowl XLV to Record Levels, Nielsen Wire,January through June 2011. The Grammy blog.nielsen.com as consumers watch programs when theyAwards, BET Awards and Academy Awards originally air. Recent surveys indicate thatattracted 4.1 million, 3.9 million and among African-American women 18–34,2.5 million African-American viewers DVR penetration has exploded from 11.3% Total Day TV and Peripheral Usage byrespectively. Dancing with the Stars and in February 2007 to 37.4% today. Ethnicity and OriginAmerican Idol drew 2.5 and 2.3 million Total U.S.African-American viewers respectively, Playstation 3 and PSP Game Systems are (Daily HH:MM) African-Americanwhile The Voice and Sunday Best 4 popular with all groups including African-garnered approximately 1.5 million each*. Americans, while use of Wii gaming systemsThe commonality between the varied falls below other demographic groups. These high media usage levels offer TV 5:11 7:12 manufacturers, media and DVD producers,Top 10 Most Watched Among video game console and game makersAfrican-Americans, Ages 18–49 access to a demographic that is a heavy user of its products. The opportunity to Total Use of TVExcluding Sports interact with African-American consumersJanuary–June 2011 (In Millions) for feedback, marketing and advertising is 4:17 6:16Rank Program Viewers quite apparent. Indirectly, other content providers and manufacturers should use 1 The Game: Season 4 3.08 this opportunity to actively interact with 2 Real Housewives Atlanta 1.76 this demographic to grow alternate usage levels. It is clear that this demographic Live TV 3 Let’s Stay Together 1.56 enjoys interacting with video and gaming 0:24 0:20 content so education and emphasis on4 American Idol-Wednesday 1.08 other alternate content mediums will 5 House of Payne 0.97 likely enhance usage levels. Advertising to this audience also presents numerous DVR Playback 6 American Idol-Thursday 0.96 opportunities. 0:15 0:18 7 Dancing With the Stars 0.95 DVD Playback 8 Grey’s Anatomy 0.83 0:13 0:16 9 Law and Order: SVU 0.8110 Apprentice 11 0.80 Video GamesPersons 18–49. Prime Day Part Live+7. Excludes breakouts, repeats, Source: Nielsen. Based on Live Stream for Persons 18–49specials, programs <5 minutes, and programs <2 telecasts. during November 2010.*Persons Ages 2+. All Day Parts. Live+7. Excludes breakouts, repeats. Copyright © 2011 The Nielsen Company. 11
Mobile PhonesTechnology companies that may not have Smartphone Penetration African-Americans’ Preference offocused on reaching African-Americans Q1 2011 Smartphoneare missing the fact that this group Q1 2011is incredibly valuable to marketers.Increasingly, Americans are buying African-smartphones for their mobile phone Overall Apple Americanneeds. Smartphones, in particular, have 44% 36% Android OS iPhone OSexperienced greater penetration among 37%ethnic or racial minorities than among thetotal population. Among mobile phone 16%users, 33% of all African-Americans own asmartphone. Additionally, 44% of all new Othermobile phone purchases by this group are 13% 5%smartphones. RIM Blackberry OS MicrosoftAlso, smartphone popularity and usage Windowsskew toward younger age groups as 30% Mobilenearly 50% penetration exists for African-Americans for age groups forty-four (44)and younger. Major opportunities exist formarketing to these young groups to growsmartphone and phone operating system Smartphone Penetration by Age Among African-Americans(OS) market share. Mirroring the trends Q1 2011seen in the general population, Androidhas distanced itself from competitors, Ages 65+taking 37% of the smartphone market 20% Ages 18–24 Ages 25–34 Agesshare among African-Americans. Mobile Ages 35–44 Ages 45–54application producers and advertisers canlook to access the huge growth mobile 51% 53% 47% 38% 55–64market for African-Americans by using 27%that programming platform and gainingentry into the Android marketplace. 1/3 of all African-Americans own a smartphone. ©iStockphoto.com/cglade12 Copyright © 2011 The Nielsen Company.
Average Voice Minutes Used by Average Number of Billed SMSAfrican-Americans per Person Sent/Received by African-AmericansQ1, 2011 Q1, 2011 1,298 907 African-American women tend to adopt Texts Sent/ minutes Received technology when it is social and relevant to improving their day-to-day lives.While smartphones tend to have higher web-based functionality, African-Americans Mobile Activities of African-Americanstend to use phones primarily for talking and texting. African-Americans talk an average Q1, 2011of 1,298 minutes a month, more than twice that of White Americans, who talk anaverage of 606 minutes a month. African-Americans also exhibit high use of phonesfor emailing (43%) accessing the mobile internet (41%) and visiting social networking Text Messaging/SMS 78%sites (37%). 51% Picture Messaging/MMSNetworking activity presents a grand opportunity to gain market penetration forbusinesses. This is especially true for women. African-American women tend to adopt Email 43%technology when it is social and relevant to improving their day-to-day lives. In additionto increasingly being the head of household and the main decision makers, women 41% Mobile Internetengage with social platforms more often, participate in surveys, and share informationwith other friends and family on products that they find useful. Cross-platform Social Networking 37%opportunities exist where live TV programming can be paired with social networkingsites for additional opportunities to market new products and build upon brand loyalty. 33% Application (App) Usage Text Alerts 31% 31% Application (App) downloads Played pre-installed games 31% 27% Picture downloads Ringtone downloads 21% 24% Location-based services/GPS Instant Messaging 24% 23% Uploads Game downloads 21% 21% Wallpaper/Screensavers downloads Copyright © 2011 The Nielsen Company. 13
Trends in Advertising Spend and EffectivenessAs consumer choice and media Overall Ad Spend (Q1 2011)fragmentation continue to grow,advertising effectiveness increasingly $ in millionsdepends on reaching the right consumer,with the right message, at the right $18,771time and in the right place—and being TV (+9% vs. Q1 2010)able to understand the direct salesimpact of those efforts. Nielsen deliversa comprehensive understanding ofadvertising’s impact by tracking the nruboc/Bigstock.comfull spectrum of advertising spend and Magazinesperformance. $3,516 (+7% vs. Q1 2010)Television advertising was the largest Newspapersmedium for all ad spending in 2010, $2,847 (-10 % vs. Q1 2010)accounting for $69 billion. In the first Radioquarter of 2011, television advertising $1,550 (+6% vs. Q1 2010)surpassed $18 billion, growing almost Source: Nielsen9% versus the same period in 2010. Radioand magazines during this same periodalso saw higher ad spend levels than lastyear, increasing between six and 7%.Newspapers, however, saw a 10% drop. Market: National African-American Media BuysIn 2010, national TV (network, cable, andsyndicated) advertising dollars aimed In Millions Nielsen Ad*Viewsat African-American audiences were Jan 1, 2009–Dec 31, 2010primarily dedicated to cable TV, whichsaw increases of 17%. Network and Media Type 2009 2010 % Changesyndicated TV saw some declines. National Magazine $358 $362 1%Total advertising expenditures spent in Spot Radio $732 $704 -4%African-American media reached $1.9B National TV $835 $916 10%in 2010, increasing 3% versus 2009. At Total $1,925 $1,982 3%$916M, TV ad spending accounted for46% of the total, followed by advertisingin spot radio ($704M) and nationalmagazines ($362M).14 Copyright © 2011 The Nielsen Company.
Procter & Gamble, the leading advertiser Top 10 Advertisers for African-Americanin general and Hispanic media, maintained Media (2010) Totalits top-ranked position in African- advertisingAmerican spending, increasing 15% from Parent Company % Change expenditures reached2009. General Motors, Verizon, AT&T,and Berkshire Hathaway, all top ten Procter & Gamble L’Oreal 15% 32% $1.9 billion in African-Americanadvertisers on a national scale, also had Johnson & Johnson -16% media ina strong presence in African-American a 3% General Motors 12% 2010 increaseadvertising. L’Oreal saw the strongest overincrease, jumping 32% from 2009. McDonald’s -7% 2009McDonald’s, the U.S. Government and Verizon -9%National Amusements were also major U.S. Government 2%players who advertised to the African- AT&T 11%American market. Berkshire Hathaway 3% National Amusements -8%Expenditures for the top 10 categories grew 2% versus last year. Top 10 Product Categories for African-American AdvertisingOverall, Automotives replaced Quick Service Restaurants as the top (2010)category, growing 10% to $98M. In addition, heated competition In Millionsamong Auto Insurers drove a staggering 125% increase in spendto $63.2M. Other categories experienced softness, balancing out Product Category 2010 % Changethe surge in growth from Automotives and Insurers. Quick Service Automotives $98 10%Restaurants, Department Stores, Motion Pictures and Direct Response Quick Service Restaurants $84 -12%Products all remained in the Top 10 but spent less than last year as Auto Insurance $63 125%they became more sensitive to changes in discretionary consumerspending. Supermarkets, however, advertised more to attract budget- Department Stores $62 -12%conscious consumers preparing meals at home. Motion Pictures $62 -23%Advertising Effectiveness Wireless Telephone Services $60 9%In an age of increasing cultural diversity and ethnic growth, advertising Pharmaceuticals $56 8%that speaks to different identities must be a vital component of any Direct Response Products $30 -26%effective marketing plan. It is incumbent on marketers to understand Supermarkets $29 21%the differences in audiences in order to successfully engage consumers.African-Americans tend to demonstrate a high degree of brand Restaurants $28 0%loyalty, so it’s incredibly useful to create ads that successfullypenetrate their awareness. Most Remembered Ads Among African-Americans Rank Brand Ad Description 1 M&M’s Pretzel - Candy complains about pretzel being put inside him; pretzel isn’t thrilled either (30-second ad)It is incumbent on 2 McDonald’s Real Fruit Smoothie - Smoothie contains real strawberries, blackberries, blueberries, and bananas (15-second ad)marketers to understandthe differences in audiences 3 M&M’s Pretzel - Candy complains about pretzel being put inside him; pretzel isn’t thrilled either (15-second ad)in order to successfully Source: Nielsen, 06/01/10 – 05/20/11engage consumers. Copyright © 2011 The Nielsen Company. 15
OnlineOnce at the epicenter of the digital divide, audience, two of which focused on online 4. BRIGHT HORIZONS—This tech-African-Americans are now 44% more technology—the Techfluentials and the savvy segment is focused on education andlikely to take a class online, 30% more Bright Horizons: friends, gaming, mobile and social media.likely to visit Twitter, and download more 1. STRIVERS—An ambitious group of As African-Americans continue to breakmovies via the Internet than other ethnic opinion leaders aged 20–40. These young misconceptions about technology habits,communities. African-American mothers, leaders are rising in their communities and so too must marketers create meaningfulin particular, are 68% more likely to read the corporate world. campaigns that incorporate socialarticles online and 45% more likely tolisten to music online. When Debra Lee, 2. CONSCIOUS SISTERS—These are networks trusted by African-AmericansBET’s CEO, addressed more than 1,000 women who are keen on aspects of their and deliver novel experiences across allmarketing decision makers at Nielsen’s culture and spirituality. They focus on forms of technology. With an expanding2011 Consumer 360 Conference, she family and are value conscious. piece of the economic pie, African-reminded them that the African-American Americans are a prime and valuable 3. TECHFLUENTIALS—World audience.consumer is not monolithic. Citing ambassadors aged 20–30 who areBET’s study African-Americans Revealed, making the world a little smaller usingshe identified four key segments that technology, to positively impact others,make up 85% of the African-American using Skype, social media and more.African-American Internet Users and Visits to Categories of SitesDuring July 2011…There were 23.9 million active African-American Internet usersof which... 76% visited a Social Networking/Blog site African-Americans are 30% more 54% visited a Travel site likely to visit Twitter. 50% visited a Mass Merchandiser site 50% visited a Current Events & Global News site 44% visited a Health, Fitness & Nutrition site 39% visited a Sports site 37% visited a Coupons/Rewards site 37% visited a Broadcast Media site 31% visited a Financial Info & News siteSource: Nielsen, NetView, Total (July 2011)These figures should not be trended with Home and Work data used prior to July 2011.16 Copyright © 2011 The Nielsen Company.
The Movie ScreenOnline Purchases Among African-American A discussion about African-American’s Top 5 African-American Themed MoviesAdults viewing habits cannot be complete to Date (with Predominantly African- % of African- without a mention of movie theaters, American Casts)Purchased Online which generate approximately $12 Americans Rank Title Gross(Last 6 Months) billion in annual revenue. African- OnlineAirline Tickets/Reservations 12.8% Americans comprise 11% of the movie 1 The Pursuit of Happyness $162.6M going population and visit the movieHotel/Motel Reservations 9.6% theater with good regularity; in fact, their 2 Bad Boys II $138.4MAny Clothes/Shoes/Accessories 9.0% attendance is up slightly year to year. African-Americans account for 11% of 3 The Nutty Professor $128.8MWomen’s Clothes/Shoes/ 6.4% heavy moviegoers—those that see nine or 4 Coming to America $128.1MAccessories more movies per year. Heavy moviegoersMen’s Clothes/Shoes/ 5.1% account for 63% of the box office receipts. 5 Nutty Professor II: The Klumps $123.3MAccessories In comparison to light moviegoers, heavy Source: eCinesys ©By Nielsen NRGSource: Nielsen moviegoers are much less price sensitive and spend more on entertainment. They are also more highly engaged with all the African-American segment are 12–17 movie marketing sources, leveraging both year olds and 45–54 year olds. Consistent studio-paid and viral sources and are with the general population, African-Online Purchases Among African-American more apt to consume movies at home, American’s favorite genres are comediesAdults via traditional physical formats as well and action adventures as is evidenced as streaming, downloading, and pay per by the Top 5 movies with predominately % more likely view. The most frequent attendees in African-American casts.Purchased Online to purchase(Last 6 Months) than averageBeer/Wine/Liquor 17%Baby Clothes/Shoes/ 12%AccessoriesWomen’s Clothes/Shoes/Accessories 5% SECTION TWO: OPPORTUNITIESSource: Nielsen. Ranked on African-American Adults OnlineIndex vs. Online 18+ Consumer Speak up about the Business Utilize trends Opportunity: images your family Opportunity: to help take your is being exposed product to the to. While African- next level. Trends in Americans, in general, are heavy technology adoption and social users of media including televisions, networking provide this groupMarketers must create mobile devices, computers and other an influence over popular culture systems, children under the age of beyond the limits of ethnicmeaningful campaigns 18 use these mediums more than categorization.that incorporate social others. African-American parents should be wary of the images theirnetworks trusted by African- kids encounter and look for waysAmericans and deliver novel to provide additional educational, physical, and socially interactiveexperiences across all forms opportunities to protect the overallof technology. health and well-being of their children. Copyright © 2011 The Nielsen Company. 17
SECTION THREE:WHAT AFRICAN-AMERICANS BUYDetermining what consumers demand—and afterward measuring what they buy—is at the core of Nielsen.Through the Cambridge Group*, we work with clients to identify and tap into not only existing consumerdemand, but latent and emerging demand from profitable groups of consumers. We also monitor shopperbehavior for more than 250,000 households in 25 countries through our industry-leading consumer panel.Nielsen offers a unique set of tools that examine key business trends by product, categoryor market using retailer scanner-based sales and causal information gatheredweekly from tens of thousands of retail outlets. This information enablesbusinesses to identify the “why” as well as the “what” behind changes inproduct sales for fine-tuned marketing strategies.Buying PowerAccording to Rick Kash, founder of As noted earlier, the buying power monkeybusinessimages ©iStockphoto.com/The Cambridge Group and co-author of African-American consumers isof How Companies Win, “You must be projected to reach $1.1 trillion by 2015.able to answer the question, ‘What do Census tract data illustrates a trend ofI know about the demand of my most increasing household incomes and anprofitable customer that my competitor increasing population which correlate African-American women aredoesn’t know?” to increased buying power within this increasingly becoming the head of community. Especially important to household or primary earnerThe African-American community is a note are the trend changes in educationvitally important market, based on its for their households. and employment for women. African-growing size and its long influence on American women are increasinglyAmerican cultural trends and innovations.African-American Women View Themselves as the Primary Decision Makers Across Virtually all Consumer Segments Both men and Women Primarily women equally Men Primarily Health/Beauty 77 23 1 Household cleaning 68 31 1 Clothes 65 35 0 Child care at home 65 33 2 Managing child care outside the home 63 36 1 Food 62 36 2 Pharmaceutical Prescription/OTC Drugs 55 44 1 Beverages 53 45 2 Family ﬁnances 52 42 6 Insurance 51 37 12 Home Electronics 50 37 13 Locations for social activities 50 47 2 Automobiles/other transportation 49 31 20 Personal Electronics 47 41 12Nielsen Women of Tomorrow Study, 2011*The Cambridge Group is a division of Nielsen and one of the world’s preeminent growth strategy consulting firms.18 Copyright © 2011 The Nielsen Company.
becoming the head of household or African-Americans spend less per trip African-Americans frequent dollar stores,primary earner for their households. in major retail channels compared to convenience/gas stores and drug stores,Additionally, these women feel they Non-African-Americans more than non-African-Americansare the primary decision makers across Basket Ring Dollars Per Trip Shopping Trips Per Householdvirtually all consumer segments. African- Non-African- African- Non-African-Shopping Habits American American Grocery American American Supercenters StoresThe purchasing behavior of African- $52.6 $62.5 56.4 58.8Americans has some distinctcharacteristics that retailers andmarketers should identify and use to African- Non-African- African- Non-African-establish effective market position. Mass American American Supercenters American AmericanAfrican-Americans shop more often than Merchandisers $44.6 $46.8 24.7 25.3all other groups, but spend less moneyper trip and overall. This behavior reflectsa propensity to make quicker/smaller African-purchases based on short-term needs and African- Non-African- American 11.4 Grocery Stores American American Dollar Storesless on deal availability or the desire to 20.7“stock up.” $34.1 $41.8 Non-African- AmericanStore Channel Frequency African- 12.7 African- Non-African- Convenience/ AmericanDespite making more shopping trips Drug Stores American American Gas 17.4overall, the occurrence of trips to grocery $21.9 $24.8 Non-African-stores, supercenters, mass marketers, Americanand warehouse store falls below the rate Source: Nielsen Homescan; Total U.S. 52 weeks endingof other groups. The African-American 12/25/2010; excludes gas only or Rx only trips African- Non-African-market is more likely to frequent drug Drug Stores American Americanstores, dollar stores and convenience/ 15.6 13.9gas outlets. Major retail channels seem tohave a prime opportunity to motivate thishighly active group to come to their stores. African- Non-African- Mass American American Merchandisers 12.4 12.9 African-American households make more shopping trips annually than any other group. African- Non-African- Warehouse American American Clubs 9.4 11.8African-Americans shop often, but spend less per trip & overall; are less deal proneTotal Retail Channels African- Non-African- Basket Ring African- Non-African-Shopping Trips American American American American Dollars PerPer Household 165.7 153 $6,138 $6,883 Household African- Non-African- African- Non-African-Basket Ring American American % Dollars American AmericanDollars Per Trip $37 $45 on Deal 20.9% 26.3% Copyright © 2011 The Nielsen Company. 19
African-American households spend more African-American households spend more on basic food ingredients & beverages on personal & beauty careBuying Habits African- African- Nielsen Edible Category American Nielsen Non-Edible Category AmericanA few major factors driving African- Dollar Index Dollar IndexAmericans’ retail traffic may be access Frozen Meat, Poultry, Seafood 168 Ethnic Health & Beauty Care 954to private transportation and lack of Dried Vegetables & Grains 161 Feminine Hygiene 188major retail development in some urbanareas where a concentration of African- Seasonings & Spices 156 Greeting Cards/Party Needs 177American communities reside. A look Refrigerated Juices & Drinks 155 Fresheners & Deodorizers 176at the buying habits of higher income Shelf-Stable Juices & Drinks 155 Personal Soap & Bath 160members of this group may shed some Baby Food 152 Women’s Fragrances 152light on the impact of these outlyingfactors. While African-Americans show the Shortening & Oil 150 Charcoal 131same product category preferences, those Non-Carbonated Soft Drinks 146 Sanitary Protection 126with household earnings greater than Sugar & Sweeteners 144 Deodorant 124$100,000 tend to make fewer trips and Ice 142 Men’s Toiletries 123spend 41% more per trip than the averagehousehold in this group. Additionally, Purchase index: share of African-American $ sales divided by U.S. household $ share X 100higher earning African-Americans Source: Nielsen Homescan, 52 Weeks Ending 12/25/2010patronize major retail chains with higherregularity and go to convenience anddollar stores at a much-reduced level than Non-Hispanic). Nielsen research also should not be construed to mean thatthe group average and spend 300% more shows that African-American consumers retailers don’t have opportunities toin higher-end retail grocers like Whole devote a lower dollar share of their total focus energy to grow store brand shareFoods than other high income households. consumer-packaged-goods spending to among African-American consumers whoThese behaviors seem to indicate that store brands (17.7% versus 18.3% for indicate a higher staying power once theyconvenience and resources may be White non-Hispanic). This tendency to be find a store brand they like. Businessesdriving behavior and represent a growth more brand loyal is reinforced by Nielsen looking to increase market share withopportunity for major retail grocery and surveys showing a lower attitudinal African-American consumers should focusmass merchandisers. connection to store brand purchasing in on women and the family/communal general and a much stronger likelihood behaviors centered around eating andAmong the major buying categories, to “always buy the brands they trust” food preparation and look for crossoverAfrican-American households spend more (46% agree/strongly agree versus 36% product placement opportunities.on basic food ingredients and beverages for White Non-Hispanic). This tooand tend to value the food preparationprocess and on average spend more timepreparing meals. Other popular buyingcategories include fragrance and personal SECTION THREE: OPPORTUNITIEShealth and beauty products.Given shopping patterns in retail Consumer Expand your Business Branch outchannels where coupon redemptions Opportunity: horizons. African- Opportunity: into untappedhave been historically low, purchasing Americans are geographic areas.on deal and response to coupons are frequent shoppers and African-Americanlower for African-American consumers. tend to be brand loyal. Consumers communities tend to shop oftenHowever, this should not be interpreted should consider looking for more but under utilize some popularthat African-Americans do not find deal opportunities and research retail chains because they mayconsumer promotions and good prices different retail channels for expanded not be easily accessible in theirto be important, as almost half (47%), service offerings, potential savings communities. Companies investingstrongly agree that “it is always important opportunities, and higher value or in stores and locations that are moreto get the best price” when shopping quality products. convenient will likely see higherfor groceries (versus 40% for White volume usage.20 Copyright © 2011 The Nielsen Company.