According to U.S. Census Bureau population estimates from July 1 last year, there are approximately 54 million Hispanics living in the United States, roughly 17 percent of the U.S. population.
This means Hispanics are the largest ethnic or race minority in America. But in truth, "minority" is the wrong term to use. In fact, in the 2014/15 school year, it is non-Hispanic white children that are a minority for the first time.
According to research firm Nielsen, Hispanics in the U.S. have a current spending power of $1.4 trillion.
These facts were forcefully brought home to me when I saw a presentation at the Hispanic PR Association’s recent Power of Integration event by Tom Maney, EVP of ad sales at Fox Hispanic Media, which owns Fox Deportes, MundoFox, Nat Geo Mundo, and Fox Life.
Of course, this is not one homogeneous group: the Hispanic population is made up of numerous subgroups, all with different characteristics and consumer behaviors.
U.S.-born Hispanics are the most significant group, making up 64 percent of the total and generally younger than their foreign-born Hispanic counterparts. Their median age is 18, compared to 40 for foreign-born Hispanics and 42 for non-Hispanics. Their household size is smaller and they earn more: Nielsen notes that 52 percent of U.S.-born Hispanics earn at least $50,000 a year.
This is a burgeoning middle class and an attractive target audience for brands. They’re buying cars for the first time, moving into new homes, furnishing those homes, and spending on consumer goods.
The Hispanic market is the most important segment for sales growth in the new vehicle sector: people buying a car for the first time. Other categories ripe for growth among Hispanics include credit cards, financial services, travel, technology, and online retail.
The Hispanic media landscape has grown exponentially, fueled by TV stations such as Telemundo, Univision and Fox. It’s also a very connected market: 79 percent of Hispanics own a smartphone, 10 percent more than non-Hispanics. They are more likely to spend time on their devices before they make purchase decisions as well as during shopping.
But many brands seem to have been slow to realize the opportunities in this fast-growing sector. Fox’s Maney noted that the top 500 advertisers in the US account for 80% of ad dollar spend, but only 216 of those companies advertise in Spanish language media.
There are 557 advertisers in the Spanish-language market, representing 1,515 brands, compared to 4,700 advertisers in the general market, and 11,000 brands. So there is a vast swathe of brands that are not currently engaging with this opportunity.
It’s not just about language either. Nielsen says Latinos shift seamlessly between Spanish and English: Thirty-five percent of Hispanic homes now speak both languages in the home, up 87 percent from 2013 – only 22 percent speak one language. So marketers need to communicate to this audience in both languages.
Maney says communication needs to be nuanced. It is no longer acceptable to dub an English language ad into Spanish – communication has to be sensitive to overall Hispanic sensibilities and the individual sensibilities of sub-groups within it. He identifies Ford, Kraft, and Procter & Gamble among the brands that really get it and customize their creative accordingly.
He also says that relying on a total market strategy to engage Hispanics is not going to work either, due to the lack of real insight into the Hispanic market. Hispanic marketing has to be fully integrated in the holistic overall strategy.
Maney is mainly talking about advertising, and of course he would love to grow the size of the advertising market to make more money for Fox. But his observations resonate just as much with PR and social media.
Anecdotally, and astonishingly, he still comes across marketers who think "these people" are not their consumers. But they clearly are. The highest percentage of 24-year-olds in the US is Hispanic – this is the future middle class of the US.
In markets such as Los Angeles, the general market is the Hispanic market. In New York City, one in three people are Hispanic. At some point, general market strategies will become Hispanic market strategies.
Latinos are no longer a subset of the market: they are a significant player in their own right. Connecting with Hispanic audiences is critical for all brands if they want to grow over the next decade.
This article first appeared on prweek.com.