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Hispanic Purchasing PowerHispanic Purchasing Power
Marketing to HispanicsMarketing to Hispanics
andand
Growing Your Busine...
IntroductionIntroduction
* Source: Terry College of Business / The Mulitcultural Economy ( 2002 )
The immense buying power...
Reason and LogicReason and Logic
 Estimates of Hispanic buying power in U.S metro
areas and counties suggest that marketi...
The OpportunityThe Opportunity
 The buying power estimates presented here
suggest that one ‘general advertisement’
or gen...
The American PieThe American Pie
U.S. Population byU.S. Population by
Race/EthnicityRace/Ethnicity
Source: U.S. Census Bur...
US Hispanic Population Soars 74%US Hispanic Population Soars 74%
Outpacing Rest ofOutpacing Rest of
PopulationPopulation
H...
In Just -5- Years the US HispanicIn Just -5- Years the US Hispanic
Population Will Grow AnotherPopulation Will Grow Anothe...
Hispanics Asians
$7.6 Trillion
$4.3
Total
+
7
7%
Billion$
African
Americans
Hispanic Buying Power GrewHispanic Buying Powe...
The Impact on Your BusinessThe Impact on Your Business
Hispanic vs. Non-Hispanic PopulationHispanic vs. Non-Hispanic Popul...
Hispanics Asians
$9.9
Trillion
Total
+
30
%
African
Americans
By 2007 Hispanic Buying PowerBy 2007 Hispanic Buying Power
I...
 In order, the 10 most Hispanic populated states are:
California, Texas, New York, Florida, Illinois, New Jersey,
New Mex...
Hispanics are Going NationalHispanics are Going National
Percentage Growth per StatePercentage Growth per State
Source: U....
Cities with Highest PercentCities with Highest Percent
Composition of HispanicsComposition of Hispanics
TOP 5 14,863,300TOP 5 14,863,300
( 42% of U.S. Hispanic Pop. )( 42% of U.S. Hispanic Pop. )
Majority of U.S. Hispanics Res...
Source: US Census 2000
Total Hispanic Non-Hisp.
Black
Non-Hisp.
Asian
Non-Hisp.
White
36.636.6
26.626.6
30.8 32.5
38.8
His...
Larger Households MeanLarger Households Mean
More Consumer Prospects…More Consumer Prospects…
2.6
2.75
3.5
2.62
TotalTotal...
More Hispanic ChildrenMore Hispanic Children
per Householdper Household
HispanicHispanic Non-HispanicNon-Hispanic
WhiteWhi...
Hispanics Show Biggest GainHispanics Show Biggest Gain
in College Graduates…in College Graduates…
Hispanics
2.84 6.07
+114...
Rising # of Hispanic OwnedRising # of Hispanic Owned
Businesses and Revenue GrowthBusinesses and Revenue Growth
Hispanic B...
Average Spending for All Consumers and Hispanic Consumers
Share Share
of Total of Total
Unit ($) ( % ) Unit ($) ( % )
TOTA...
SBS Markets –SBS Markets –
Consumer ProfilesConsumer Profiles
L.AL.A N.YN.Y.. P.RicoP.Rico MiamiMiami ChicagoChicago S.S.
...
LA NY Miami Chicago SA
White Collar Occupat ion 1,222 707 436 239 204
37 35 46 32 48
Professional / Executive 495 284 179 ...
LA NY Miami Chicago SA
HHLD Has Home Mort gage 480 335 188 152 64
15 17 20 20 15
HHLD Has Home Equit y Loan 122 97 57 65 2...
LA NY Miami Chicago SA
HHLD Has 401K or I RA 631 446 179 213 102
19 22 19 28 24
HHLD Has Mutual Funds 916 573 315 254 165
...
Summary & OutlookSummary & Outlook
 Hispanic Consumer Buying Power will rise another 60% in the next
five years – twice t...
What Others Say…What Others Say…
 “ Corporate America cannot continue to wait on
investing in the Hispanic Market. The si...
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Profile of the U.S. Hispanic Consumer 2

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Profile of the U.S. Hispanic Consumer 2

  1. 1. Hispanic Purchasing PowerHispanic Purchasing Power Marketing to HispanicsMarketing to Hispanics andand Growing Your BusinessGrowing Your Business Dennis Caicedo / Director Sales Research & Development Spanish Broadcasting System
  2. 2. IntroductionIntroduction * Source: Terry College of Business / The Mulitcultural Economy ( 2002 ) The immense buying power of 39 million Hispanic consumers is energizing the U.S. consumer market as never before. This major group, which represents nearly 14% of the country’s population, has a disposable income of an estimated $580 billion for 2002. - “ Over a seventeen-year period, 1990-2007, the nation’s Hispanic buying power will grow at a compound annual rate of 8.7 %. The comparable rate of growth for non-Hispanics is 4.8 %. In sheer dollar power, Hispanic economic clout will rise from 223 Billion in 1990 to 926 Billion in 2007…a 315 % increase over 1990 ” The nation’s fastest growing minority group is increasingly becoming the focus of corporations eager to develop new markets for their products and services.
  3. 3. Reason and LogicReason and Logic  Estimates of Hispanic buying power in U.S metro areas and counties suggest that marketing to Hispanic consumers will contribute to the bottom line of most companies or enterprises.  Already, the Hispanic market is attracting greater attention from businesses large and small.  The explosion of Hispanic media— whether radio, television, magazines or on the Internet— reflects the increasing number of advertising dollars targeted towards U.S. Hispanics.
  4. 4. The OpportunityThe Opportunity  The buying power estimates presented here suggest that one ‘general advertisement’ or generic product geared for all consumers increasingly misses many potentially profitable market opportunities.  As the consumer market becomes more diverse, advertising, products, and media must be tailored to each market segment.
  5. 5. The American PieThe American Pie U.S. Population byU.S. Population by Race/EthnicityRace/Ethnicity Source: U.S. Census Bureau, 2000 La Agencia de Orcí & Asociados
  6. 6. US Hispanic Population Soars 74%US Hispanic Population Soars 74% Outpacing Rest ofOutpacing Rest of PopulationPopulation Hispanics Asians 22.422.4 38.938.9 30 35.8 + 74% + 19% 287.9 248.7 Total + 16% 7.3 11.5 + 58% African Americans 1990 2002 1990 2002 ( Millions )( Millions ) •Source: 1) US Census 2000 2) Terry College of Business / Buying Power at the Beginning of a New Century ( 2000 – 2001 )
  7. 7. In Just -5- Years the US HispanicIn Just -5- Years the US Hispanic Population Will Grow AnotherPopulation Will Grow Another 29%29% Hispanics 38.938.9 50.250.2 248.9 255.9+ 29% +2.8% Total ( Millions )( Millions ) Non-Hispanic 1990 2000 306.2 287.9 +6.3% 2002 2007 2002 2007 2002 2007 Source: Selig Center for Economic Growth, The University of Georgia 2002 - Buying Power) 1990 2007
  8. 8. Hispanics Asians $7.6 Trillion $4.3 Total + 7 7% Billion$ African Americans Hispanic Buying Power GrewHispanic Buying Power Grew 160% Over the Past 12 years160% Over the Past 12 years Non- Hispanic Whites $6.3 Trillion+ 62 % $223$223 $580$580 + 160% $646 Billion + 110 % $118 + 15 1% Source: Selig Center for Economic Growth, The University of Georgia 2002 - Buying Power) $296 Billion 1990 2002 1990 2002 $3.9 $317
  9. 9. The Impact on Your BusinessThe Impact on Your Business Hispanic vs. Non-Hispanic PopulationHispanic vs. Non-Hispanic Population and Buying Power Trends 1990 – 2002and Buying Power Trends 1990 – 2002 PopulationPopulation Buying PowerBuying Power (Millions) (Billions) 1990 2002 % Chg. 1990 2002 % Chg. Hispanic 22,600 38,900 74% $ 223 $ 580 160% Non- Hispanic 226,300 248,900 10.0% $ 4,054 $ 7,052 74% U.S. Total 248,700 287,800 15.6% $ 4,277 $ 7,632 78% •Source: 1) US Census 2000 2) Terry College of Business / Buying Power at the Beginning of a New Century ( 2000 – 2001 )
  10. 10. Hispanics Asians $9.9 Trillion Total + 30 % African Americans By 2007 Hispanic Buying PowerBy 2007 Hispanic Buying Power Is Expected To Grow AnotherIs Expected To Grow Another 60%60% Non-Hispanic Whites $7.9 Trillion + 25% $580 $926 + 60 % $646 Billion $853 Billion + 3 2 % $296 Billion $455 Billion + 54% Source: Selig Center for Economic Growth, The University of Georgia 2002 - Buying Power) …and outpace that of All Non-Hispanics $7.6Trillion $6.3Trillion 2002 2007 Billion$
  11. 11.  In order, the 10 most Hispanic populated states are: California, Texas, New York, Florida, Illinois, New Jersey, New Mexico, Colorado, Washington and Georgia.  In order, the 10 states…with the greatest Hispanic buying power: California, Texas, Florida, New York, Illinois, New Jersey Arizona, Colorado, Georgia and New Mexico.  The five most Hispanic populated states account for 67% of Hispanic buying power in the U.S. Where to LocateWhere to Locate Your Share?Your Share? * Source: Terry College of Business / Buying Power at the Beginning of a New Century ( 2000 – 2001 )
  12. 12. Hispanics are Going NationalHispanics are Going National Percentage Growth per StatePercentage Growth per State Source: U.S. Census Bureau, 2000
  13. 13. Cities with Highest PercentCities with Highest Percent Composition of HispanicsComposition of Hispanics
  14. 14. TOP 5 14,863,300TOP 5 14,863,300 ( 42% of U.S. Hispanic Pop. )( 42% of U.S. Hispanic Pop. ) Majority of U.S. Hispanics ResideMajority of U.S. Hispanics Reside in the Top 10 Hispanic Markets…in the Top 10 Hispanic Markets… Market Hispanic Pop. 1) Los Angeles 6,599,500 2) New York 3,852,200 3) Miami 1,564,400 4) Chicago 1,498,600 5) Houston 1,348,600 Market Hispanic Pop. 6) San Fran 1,384,700 7) Dallas 1,120,350 8) S. Antonio 818,000 9) Phoenix 817,000 10) McAllen-Brownsville 786,700 TOP 10 19,789,350TOP 10 19,789,350 ( 57% of U.S. Hispanic Pop. )( 57% of U.S. Hispanic Pop. )
  15. 15. Source: US Census 2000 Total Hispanic Non-Hisp. Black Non-Hisp. Asian Non-Hisp. White 36.636.6 26.626.6 30.8 32.5 38.8 Hispanics’ Median Age is Lowest in the Nation: Hispanics are Younger and RepresentHispanics are Younger and Represent Growing Number of Consumer ProspectsGrowing Number of Consumer Prospects
  16. 16. Larger Households MeanLarger Households Mean More Consumer Prospects…More Consumer Prospects… 2.6 2.75 3.5 2.62 TotalTotal HispanicHispanic Non-Non- Hisp.Hisp. WhiteWhite Non-Hisp.Non-Hisp. BlackBlack Source: US Census Bureau, March 2000 CPS, Households Size 1967-1999) Larger Hispanic Households – Higher Birth Rate and Extended Nuclear Family  Average No. People/Household
  17. 17. More Hispanic ChildrenMore Hispanic Children per Householdper Household HispanicHispanic Non-HispanicNon-Hispanic WhiteWhite Non-Hisp.Non-Hisp. BlackBlack Source: US Census Bureau 2000, Race – Age & Sex for the U.S. Percent (%) Composition of Household Under 18 Years Old 35% 22.6% 32.5% Market to young, growing and influential U.S. population
  18. 18. Hispanics Show Biggest GainHispanics Show Biggest Gain in College Graduates…in College Graduates… Hispanics 2.84 6.07 +114% Source: Census 2000, Educational Attainment 70.35 Total +44 % African Americans 101.58 +29.6 % 5.74 +73% 9.89 1987 1997 Non-Hispanic Whites ( Millions ) 80.04 61.78 61.78
  19. 19. Rising # of Hispanic OwnedRising # of Hispanic Owned Businesses and Revenue GrowthBusinesses and Revenue Growth Hispanic Business African American Business Number of Businesses 422,373 +184% 1.2 Million 424,165 +94% 823,499 1987 1997 Sales and Receipts (000) $24.7 Billion $186.3 Billion 3.5 X higher $71.2 Billion 7.5 X higher $19.8 Billion Source: 1992 & 1997 Economic Census 13.7 Million +52% 20.8 Million $1,955 Billion $18,553 Billion Hispanics African AmericansTotal Total 9.3 X higher
  20. 20. Average Spending for All Consumers and Hispanic Consumers Share Share of Total of Total Unit ($) ( % ) Unit ($) ( % ) TOTAL ANNUAL 38,045 100 32,735 100 EXPENDI TURES FOOD AT HOME 3,021 7.9 3,496 10.7 FOOD AWAY FROM HOME 2,137 5.6 1,865 5.7 ALCOHOLIC BEVERAGES 372 1.0 285 0.9 HOUSI NG 12,319 32 10,850 33.1 APPAREL & SERVICES 1,856 4.9 2,076 6.3 TRANSPORTATI ON 7,417 19.5 6,719 20.5 HEALTH CARE 2,066 5.4 1,243 3.8 ENTERTAINMENT 1,863 4.9 1,186 3.6 PERSONAL CARE PRODUCTS 564 1.5 564 1.7 & SERVICES PERSONAL INSURANCE & PENSIONS 3,365 8.8 2,608 8.0 MISCELLANEOUS 3,065 8.1 2,406 5.7 ALL Consumers Avg Spending Per Consumer Hispanic Consumers Avg Spending Per Consumer U.S. Average Annual ExpendituresU.S. Average Annual Expenditures and Item Share - 2000and Item Share - 2000 Source: Shares calculated by the Selig Center, based on data from the Consumer Expenditure Survey, 2000.
  21. 21. SBS Markets –SBS Markets – Consumer ProfilesConsumer Profiles L.AL.A N.YN.Y.. P.RicoP.Rico MiamiMiami ChicagoChicago S.S. AntonioAntonio Average # 4.2 3.4 3.7 3 4 3.2 Persons / HH Buying Power ($ Billions ) 66.8 39 31 39 12.8 11.5 Mean HH $51,912 $48,399 $27,017 $57,472 $52,303 $37,077 Source: Strategy Research Corp 2002
  22. 22. LA NY Miami Chicago SA White Collar Occupat ion 1,222 707 436 239 204 37 35 46 32 48 Professional / Executive 495 284 179 96 81 Mangerial / Administ rative 15 14 19 13 19 Employed Full-Time (35+ Hr) 2,091 1,146 580 526 269 64 57 61 70 63 Tw o or More Persons 1,847 979 563 408 223 Employed in Household 56 49 59 54 62 Self Employed / 432 184 136 69 39 Small Business Ow ner 13 9 14 9 9 Household I ncome 35K + 1,932 1,227 610 455 242 59 61 64 60 57 (000) (%) No. and % of Hispanics per MarketNo. and % of Hispanics per Market That BelongThat Belong to Specified Groupto Specified Group Below:Below: Hispanic Persons 25-Hispanic Persons 25- 6464 Scarborough: Release2 – Aug.‘01 – July ‘02 / SBS - U.S. Hispanic Markets
  23. 23. LA NY Miami Chicago SA HHLD Has Home Mort gage 480 335 188 152 64 15 17 20 20 15 HHLD Has Home Equit y Loan 122 97 57 65 22 4 5 6 8 5 HHLD Has Savings Account 1,692 1,157 535 446 305 52 58 56 59 72 HHLD Has Checking Account 1,741 1,205 701 409 297 53 60 74 54 70 HHLD Has CD or MM Acct s 179 267 151 105 63 6 13 16 14 15 (000) (%) No. and % of Hispanics per MarketNo. and % of Hispanics per Market That BelongThat Belong to Specified Groupto Specified Group Below:Below: Hispanic Persons 25-Hispanic Persons 25- 6464 Scarborough: Release2 – Aug.‘01 – July ‘02 / SBS - U.S. Hispanic Markets
  24. 24. LA NY Miami Chicago SA HHLD Has 401K or I RA 631 446 179 213 102 19 22 19 28 24 HHLD Has Mutual Funds 916 573 315 254 165 St ocks or Securit y I nvest mt 28 29 33 34 39 HHLD Has Any I nvestment 1,027 703 371 307 1,027 31 35 31 41 31 HHLD Used Any Credit Card 2,020 1,302 743 438 107 Past - 3 - Mont hs 61 65 78 58 25 (000) (%) No. and % of Hispanics per MarketNo. and % of Hispanics per Market That BelongThat Belong to Specified Groupto Specified Group Below:Below: Hispanic Persons 25-Hispanic Persons 25- 6464 Scarborough: Release2 – Aug.‘01 – July ‘02 / SBS - U.S. Hispanic Markets
  25. 25. Summary & OutlookSummary & Outlook  Hispanic Consumer Buying Power will rise another 60% in the next five years – twice that of Non-Hispanic buying power.  Given the high growth rate of the Hispanic Market advertisers & marketers can not afford to miss the mark.  Due to both higher rates of natural increase and immigration, the Hispanic population is growing more rapidly than the total population, a trend that is not expected to change.  Census data indicates that the number of U.S. Hispanics earning more than $50,000 annually grew by over 128% between 1994 and 2000  Hispanic Buying Power in the next decade will be further enhanced due to the numbers of young Hispanics who are either entering the workforce for the first time or moving from entry-level jobs to the next step on their career ladders.
  26. 26. What Others Say…What Others Say…  “ Corporate America cannot continue to wait on investing in the Hispanic Market. The size of the Hispanic market has repeatedly caught Census forecasters by surprise. The corporations that have been successful in reaching the Hispanic market did not wait for the Census to develop multicultural marketing strategies. They realize the Hispanic market’s full purchase-dollar potential and have seized the opportunity. ” Carlos Santiago ( Santiago & Valdes )

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