Transcript Understanding the Hispanic Market

Understanding
The Hispanic Market
August, 2004
Agenda
U.S. Hispanic Facts and Figures
Assimilation vs. Acculturation
Geography
Language Preferences
Hispanic Segments
Characteristics and Core Values
Marketing Implications
Hispanic Population & Media Usage
TMN Markets
2
Hispanics in the U.S.

The Hispanic population grew by 13 million
between 1990 and 2000, to a total of 35.3 million.

Hispanics have now overtaken the AfricanAmerican population as the largest minority
group with 35.3 million Hispanics in the U.S.
Hispanic Percentage of
U.S. Population

The Median age of Hispanics is 28 vs. 37 for
non-Hispanics.
25%

92 percent of Hispanics live in metropolitan
areas, compared to 77 percent of white
non-Hispanics.

50 percent of all Latino households have
household incomes of $28,300 or more.
Source:
2000 U.S. Census
Strategy Research Corporation, 2002
20%
13%
2002
2030
2050
3
U.S. Hispanic Facts and Figures
Assimilation vs. Acculturation
Geography
Language Preferences
Hispanic Segments
Characteristics and Core Values
Marketing Implications
Hispanic Population & Media Usage
TMN Markets
Definitions

Assimilation:
1. the cultural absorption of a minority group into the main cultural body

Acculturation:
1. Cultural modification of an individual, group, or people by adapting to or
borrowing traits from another culture; also: a merging of cultures as a result
of prolonged contact
2. The process by which a human being acquires the culture of a particular
society from infancy.
5
No Need To Assimilate

Constant influx of new immigrants

Spanish media meets wide range news/entertainment needs

Keeping “in touch” is easy and inexpensive

Geographically close to home countries

Tolerance to cultural differences has increased in the U.S.
6
Hispanic “Generational” Segments Will
Continue to Grow in the Coming Decades
70
Millions
60
50
40
2nd+ Generation
1st Generation
Foreign Born
30
20
10
0
1995
Source:
2000
2005
The Urban Institute, Washington DC, 1998, in
Valdes, I., Marketing to American Latinos, 2000
2010
2015
2020
2025
7
Acculturation Segments
YEAR 2002
66%
9%
Highly Acculturated
Partially Acculturated
Unacculturated
47%
YEAR 1994
25%
19%
34%
8
Source:
Strategic Research Corporation - 1994 & 2002 U.S. Hispanic Market
“Retroacculturation”
“Do you consider yourself Hispanic or American?”
Hispanic
First
70%
American
First
11%
Equally
19%
9
Source:
Strategic Research Corporation - 2002 U.S. Hispanic Market
Hispanic “Acculturation” Diversity
Will Continue to Grow As Well
U.S. born



First, second, third generation
Brand, category “mature”
Marketing savvy
Foreign-born



Source:
Recent arrivals vs Long-term
Brand heritage/ lack thereof
Advertising, information “hungry”
Valdes, I., Marketing to American Latinos, 2000
© 2002 Santiago & Valdés Solutions
10
U.S. Hispanic Facts and Figures
Assimilation vs. Acculturation
Geography
Language Preferences
Hispanic Segments
Characteristics and Core Values
Marketing Implications
Hispanic Population & Media Usage
TMN Markets
Before the 2000 Census
HISPANICS WERE ALREADY THE LARGEST MINORITY IN THESE STATES
12
Source:
Census Bureau, 2000; USA Today
After the 2000 Census
HISPANICS BECAME LARGEST MINORITY IN SEVEN MORE STATES
13
Source:
Census Bureau, 2000; USA Today
And in the 2010 Census
HISPANICS WILL BE THE LARGEST MINORITY IN THESE STATES
14
Source:
Census Bureau, 2000; USA Today
85% of Hispanics Live In Ten States
15
Source:
Census Bureau, 2000; USA Today
In the Top 10 Hispanic States, 46%
Live in TMN Markets
16
Source:
Census Bureau, 2000; USA Today
U.S. Hispanic Facts and Figures
Assimilation vs. Acculturation
Geography
Language Preferences
Hispanic Segments
Characteristics and Core Values
Marketing Implications
Hispanic Population & Media Usage
TMN Markets
Language Frequently Spoken at Home
English
Bilingual
Spanish
16%
10%
74%
18
Source: Strategy Research Corporation, 2002
Language Most Comfortable Speaking
21%
Spanish
Bilingual
English
15%
64%
19
Strategy Research Corporation, 2002
Language Most Comfortable Speaking
6%
1%
26%
53%
17%
92%
19%
English
Bilingual
Spanish
57%
28%
Highly Acculturated
Partially Acculturated
Unacculturated
20
Source: Strategy Research Corporation, 2002
Language Most Comfortable Speaking
5%
11%
63%
84%
English
Bilingual
Spanish
22%
15%
U.S. Born
Foreign-Born
21
Source: Strategy Research Corporation, 2002
The Importance of Advertising in Spanish
71%
“I get more information
about a product when it’s
advertised in Spanish”
62%
69%
65%
64%
60%
“I am more inclined to
purchase brands
advertised in Spanish”
60%
58%
1994
1997
2000
2002
22
Source:
Yankelovitch Hispanic Monitor, 2002
Adult Language Preferences
in Advertising

Spanish is the preferred advertising language for the majority of Hispanic
parents and grandparents
 Heavily influencing under 18 segment
TOTAL
Latino
Adults
Young
Adults
(18–24)
Bebes,
Niños
Parents
(25–34)
Tweens,
Teens
Parents
(35–49)
Bebes,
Tweens,
Teens
Grand
Parents
(50–64)
ENGLISH
30 %
44 %
26 %
29 %
26 %
SPANISH
55 %
13 %
46 %
10 %
58 %
16 %
57 %
13 %
62 %
13 %
BOTH
23
Source:
Strategy Research Corporation 2002
U.S. Hispanic Facts and Figures
Assimilation vs. Acculturation
Geography
Language Preferences
Hispanic Segments
Characteristics and Core Values
Marketing Implications
Hispanic Population & Media Usage
TMN Markets
Age Cohorts Are Large Enough for
Focused Sub-targeting Opportunities
19%
LOS
BEBES
Y LOS
NIÑOS
1 in 5
19%
16%
14%
13%
Gen Ñ
1 in 5
10%
“New” LATINAS/
LATINOS
1 in 3
8%
LATIN
BOOMERS
1 in 5
LOS
GRANDES
1 in 10
HISPANIC POPULATION BY AGE BREAK
25
Population by Age Group (%)
Over a third (35%) of all U.S. Hispanics are younger than
18 years of age vs. 26% of the overall population
20%
Hispanics
15%
NonHispanics
10%
5%
0%
<6
6-12
13-17
18-24
25-34
35-44
45-54
55-64
65-74
75-84
85 +
26
Source:
2000 U.S. Census
Los Bebés - A Latino Baby Boom


Age 0–6
Presently, more than one in five (20%)
of all babies born in the U.S. will be
born to a Hispanic Mom







60% in Los Angeles,
30% in New York,
40% in Miami,
82% in El Paso,
67% in San Antonio,
22% in Chicago ….
This presents unique
challenges and opportunities
27
Source:
Valdés, I. Marketing to American Latinos, PMP, 2000
Los Bebés y los Niños
Most being raised Bilingual and Bicultural

Age 6–12

7 million in 2002

Will grow over 25% by 2010, faster than any other group

Live mostly in bilingual households, fewer in English-dominant
households

Have more in common with American youth

Experience a society where it’s “OK” to be different
28
Source:
Valdés, I. Marketing to American Latinos, PMP, 2000
Generation Ñ Culture

“Best of Both Worlds”

Tweens 10–14

Teens, 15–19

Bilingual and Bicultural

Have more in common with
American Teens

Proud to be “Latino”

Hip and consumption-oriented
Source:
Valdés, I. Marketing to American Latinos, PMP, 2000
© 2002 Santiago & Valdés Solutions
29
Hispanic Youth (Age 0–19)
“Generational” Segments
100%

14% born outside the U.S.
90%
33%
80%

54% first U.S. born
generation to at least one
immigrant Hispanic Parent
70%
US Born 2nd Gen
US Born 1st Gen
Foreign Born
60%
50%
40%
54%
30%
20%
10%
14%
0%
30
Source:
Strategic Research Corporation, 2002
Hispanic Youth Purchase Power $$

Hispanic Teens account for about $20 billion of the $140 billion teen
market purchases

Spending their allowance and own earned money

Allowance money received by Hispanic Youth

Tweens
$13/wk $2.4 Billion

Niños
$8.60/wk $3.6 Billion

Total Hispanic Youth Direct Purchase Power = $26 Billion

Spend their money on music, entertainment, food & snacks
31
Sources:
Nielsen Media Research, Visa’s Annual Back To School Survey
The “New” Latina/Latino


Bilingual and Bicultural
(47% are foreign born)
Age 18 – 39

Fastest growing among first-time
employed persons (women more so)

Increasingly in managerial positions
(women more so)
32
Source: I.Valdes, “Marketing to American Latinos”, PMP, 2000
The “New” Latina

Fastest growing small business
owners in the U.S.

Good spenders


More “banked” than previous
generation
Modern, yet many times caught
between old/new ways of life
33
Source: 2002 Santiago & Valdés Solutions
Latino Boomers:
“Sandwich” Generation!


The Latino Boomers segment
has over 7 million Hispanics
between the ages of 40 and 59,
or every 1 in 6 Hispanics.
They are a “Sandwich
Generation” between the old
and the new Latino culture
(60% are foreign-born)
34
Source: I.Valdes, “Marketing to American Latinos”, PMP, 2000
Latino Boomers:
“Sandwich” Generation!

“Foreign-borns” have resided about half their adult life in the U.S. …
becoming U.S. citizens

Slowly acculturating, motivated by children and labor opportunities

But a large segment of Latino Boomers is still traditional

Many more fully bilingual but not necessarily “bi-cultural”

Many are young grandparents

Most have credit cards and are “banked”

Many own brand new cars; more own homes than ever before
(selected markets)

Almost universal ownership of durable goods (cameras, several TVs,
microwave ovens, DVDs)
35
Source:
I.Valdes, “Marketing to American Latinos”, PMP, 2000
Los Grandes:
An Emerging Mature Market

About 1 in 7 Hispanics or 6 million
are 50+.

Hispanics represent 7% of 50+ U.S.
population.

Hispanic 50+ population is expected
to nearly triple by 2020, from 4.5
million in 1998 to 12.2 million.
36
Source:
I.Valdes, “Marketing to American Latinos”, PMP, 2000
Los Grandes:
An Emerging Mature Market




“Learning the ropes” of being seniors
in a very different culture
(64% are foreign-born)
Many live with their children or other
family members
Involved in “rearing” grandchildren
Social activities center around the
family
37
Source:
I.Valdes, “Marketing to American Latinos”, (forthcoming, PMP, 2002)
Los Grandes:
An Emerging Mature Market

Many prefer Spanish language

Quality of life varies drastically based
on socio-economic status

Interested in insurance services,
advocacy, voter registration, health
and wellness, religion
38
Source:
I.Valdes, “Marketing to American Latinos”, (PMP, 2002)
U.S. Hispanic Facts and Figures
Assimilation vs. Acculturation
Geography
Language Preferences
Hispanic Segments
Characteristics and Core Values
Marketing Implications
Hispanic Population & Media Usage
TMN Markets
Communicating with Latinos requires
Deeper Knowledge than ever

Growing Complexity of Target Market

Fundamental changes in media structure



Customization
Fragmentation
Technology


Permission marketing
One person at a time
SRI U.S. Hispanic Boom Conference. June 10-11, 2004
40
Latinos continue to Love Being Latino

Fundamental culturally based behaviors
continue

Deeper consumer knowledge is required
to effectively communicate

Advertisers need market experts
SRI U.S. Hispanic Boom Conference. June 10-11, 2004
41
Latino
Characteristics and Core Values
Values
Language

Latinos speak Spanish with
distinct national idioms
Food


Our Food is Us! Bonding Latino
emotional mainstay
Flavor Please! The cuisines
differ slightly, but the requisite
is the same

Communal, interdependent orientation
centered on “La Familia Unida”

Legacy of human values, centered
on loyalty, cooperation and
helping one another

Respect, particularly for those
of a higher social status, their
elders and the mother

Hospitality –“Mi casa es tu casa”
– in which food is key element
Class Structure


Religion
Latinos naturally accept a social
pecking order
American egalitarianism can be
unnerving, depending on their
social status

Predominantly Catholic
Cultural Identification

Latinos identify with their country of origin
42
Source:
Project “Corazon” 2001 - Kraft proprietary study
Differences in Values & Beliefs
Non-Hispanic
Hispanic
Minimize differences
Everybody is the same
Stress differences
Show respect
What do we stress in
relationships?
Balance, Harmony,
Competition, Informality
Respect, Cooperation,
Formality
What do we value in
people?
A person's achievements
through special skills
A person's background
On whom do we rely
for help?
Ourselves and
institutions
Family, friends,
community,
"our social security"
How do we relate to
people?
Source: Cultural Access Group
SRI U.S. Hispanic Boom Conference. June 10-11, 2004
43
Four Imperatives of Latino Culture
Familismo
(Family)
Family Unity continues to be Imperative
Machismo
Marianismo
Chicoismo
(Man’s role)
(Woman’s role)
(Children’s role)
Leads
Provides
Keeps family
together
Family legacy
Acculturation:
Acculturation:
Acculturation:
• Surrender some
power over the
household
• Awaken to
the self
• Gain more
freedom
• Gain more
freedom
• Become
self-reliant
44
Source:
Marketing to American Latinos, Isabel Valdes 1999
U.S. Hispanic Facts and Figures
Assimilation vs. Acculturation
Geography
Language Preferences
Hispanic Segments
Characteristics and Core Values
Marketing Implications
Hispanic Population
Marketing Implications:
Be Flexible; Communicate Differently

Consider re-positioning, re-labeling, re-introducing product for
greater ROI

Highlight new products



Assume many existing products are new to a large percentage of adult Hispanics

“Show Me” vs “Tell Me”

Provide practical advice
To gain “Share of Pocket”

First gain “Share of Mind” (Awareness/Familiarity/Trust)

But more importantly, “Share of Heart” (emotional & cultural Hot Buttons)
To “Gain Share of Heart”

Leverage distinct value orientation vs anglos, impacting communications
46
U.S. Hispanic Facts and Figures
Assimilation vs. Acculturation
Geography
Language Preferences
Hispanic Segments
Characteristics and Core Values
Marketing Implications
Hispanic Population
& Media Usage
TMN Markets
Hispanic Population
Have Larger Households
Average Persons Per Household
(Top 5 Most Populous Hispanic Markets)
3.9
3.7
3.7
3.3
2.8
Chicago
Los
Angeles
Houston
New York
Miami
48
Source:
2002 Strategy Research Corporation.
Hispanics Have an Increasing
Economic Impact on the U.S.
Hispanic Buying Power: $428 Billion
Total Hispanic Retail Sales: $240 Billion
Mean Household Income: $45,701
Source:
2002 Strategy Research Corporation;
49
Hispanic Diversity of the Total U.S. and
TMN Markets
Puerto Rico
8%
Other
25%
Puerto Rico
11%
Mexico
75%
Other
10%
Other
14%
Mexico
66%
Columbia
12%
Mexico
4%
Puerto Rico
9%
Guatemala
2%
Guatemala
4%
Cuba
45%
El Salvador
5%
Cuba
5%
Chicago Market
(1,603,761 people)
Honduras
5%
Miami Market
Total U.S. Market
(1,719,474 people)
(38,628,652 people)
Puerto Rico
1%
Ecuador
12%
Other
22%
Other
29%
Other
12%
Colombia
10%
Guatemala
3%
Mexico
75%
El Salvador
9%
Dominican
Rep
13%
Puerto Rico
34%
L.A. Market
(7,000,800 people)
Source:
Mexico
14%
2002 Strategy Research Corporation.
N.Y. Market
(3,971,345 people)
Mexico
9%
Puerto Rico
50%
Orlando Market
(383,540 people)
Cuba
7%
Acculturation Levels Into U.S. Culture
By Market
Chicago
71%
Acculturation
by DMA
64%
68% 66%
Los Angeles
New York
(% of adults)
Miami
32%
20%
9%
5%
9%
24%
29%
5%
Highly Acculturated
Partially Acculturated
Unacculturated
51
Source:
2002 Strategy Research Corporation.
U.S. Hispanic Facts and Figures
Assimilation vs. Acculturation
Geography
Language Preferences
Hispanic Segments
Characteristics and Core Values
Marketing Implications
Hispanic Population
& Media Usage
The Changing Face of Los Angeles
Nationally, L.A. is the largest Hispanic market
with 4 out of every 10 of the Los Angeles
population being of Hispanic descent
% Increase
in Los Angeles
Population
156%
(1980 – 2002)
54%
L.A.’s Hispanic
Population 2002
7,000,818
Total Adults
Hispanic Adults
53
Source:
2002 Strategy Research Corporation.