Latino and Hispanic individuals make up one of the fastest-growing consumer bases in the United States, currently totaling nearly 17% of the country’s population. Yet, most marketers continue to totally ignore this demographic, or limit their efforts to occasional Spanish-language ads and product labels. In this article, we’ll talk about why advertisers who don’t focus on Latino and Hispanic populations will quickly fall behind those who do, and why your company needs to take this hugely important demographic into account.
The Hispanic and Latino market is often referred to as a “minority” interest group, but realistically, that’s a pretty incredible falsehood, and that kind of perspective means losing out on a huge sales opportunity. As I mentioned, almost 17% of the population of the United States consider themselves to be of Hispanic or Latino descent – and that number is only growing. In the past ten years, that population has almost doubled, with the market growing over 40% in that time frame, and promising to increase further over the next few decades.
A recent Forbes article highlighted a few more demographic trends: the Hispanic and Latino market has a purchasing power that’s expected to grow to $1.5 trillion in the next two years. By 2050, the Hispanic and Latino population is expected to make up almost 1 in 3 residents in the entire United States, further expanding that purchasing power.
And, the Hispanic and Latino market has a fairly young median age, a full decade younger than the average of consumers in the entire American market. Add to this the fact that one in three babies born in the US after 2015 is expected to be a member of this population, and this leads to a steady boom in a population that is likely to be tech-savvy and eager to purchase.
Where We Stand Now
The marketing and advertising industry simply isn’t investing in the Hispanic and Latino demographic category right now, even though this population clearly represents a huge opportunity for giant ROI when it comes to targeted campaigns. There’s no real way to collect data on how a population isn’t being reached, but just look around you. How many ads do you see each day featuring Hispanic or Latino individuals?
The reasons for this invisibility vary. Part of it is likely an insidious form of racism – the “average” American is still seen as a member of a white, decently affluent, nuclear family, and that tends to be who ads feature and are targeted to. With Hispanic and Latino individuals caught in the crossfire of debates about immigration, I find it entirely probable that advertisers, consciously or no, are loathe to contribute to increased visibility for the growing Hispanic and Latino population in the United States.
Beyond that, there’s simply bad data about how much Hispanic and Latino people are spending. According to a recent AdAge article, consumer data on race- and ethnicity-based demographic information tends to be fairly flawed and inaccurate. Sales data relating to this group often misses important information from independent stores in largely Hispanic and Latino neighborhoods, and tends to under represent non-English speaking individuals.
And apparently, due to that lack of data, companies try to fill in the gaps by translating data from one purchase area to another, or by mixing data from different studies and surveys. All together, these discrepancies wind up showing that Latino and Hispanic individuals spend 40% to 60% less than they actually do. So according to market research, you’d never know that Hispanic and Latino consumers make up such a potentially profitable market segment.
This is compounded and worsened by the fact that the Latino and Hispanic population is totally under represented in the marketing industry itself – on a recent “Who to Watch in Adland” list, zero Latino or Hispanic marketing professionals were represented. Of course, this may have more to do with the proclivities of those who compiled the list (there weren’t any women on it, either), but the list definitely sparked a conversation about why there are so few members of this all-important population leading the marketing world.
Where to Go From Here
The Latino and Hispanic market is hugely important to your business. And it’s not just important now – laying the groundwork for future targeting campaigns will only help your business as this population continues to grow and increase its buying power. A recent Forbes article likened the outcome of businesses who don’t market to the Latino and Hispanic demographic to the outcome of the Mitt Romney campaign, which also failed to do so: not going anywhere positive fast. (Hint: Mitt Romney’s Univision appearance is a great example of how not to appeal to potential Hispanic and Latino customers.)
The key, of course, is marketing to Hispanic and Latino individuals in a way that is relevant to their purchasing decisions. Much like I talked about in my article about women and “pink advertising,” slapping together a Spanish-language version of an ad isn’t going to cut it. Aggregating better market data might be a good place to start, since it’s hugely lacking right now. Encouraging more employment of Latino and Hispanic marketing professionals in leadership positions is a great way to get going, too.
Beyond that, it’s about building relationships with a new customer base, and developing a cultural intelligence that goes beyond quick fixes to up your sales. The Latino and Hispanic demographic is only going to become a larger consumer base in coming years, so, marketers, put your heads together now to come up with a way to do culturally relevant, targeted marketing right.
Is your company currently targeting the Hispanic and Latino market? What kind of techniques are you using?
More Business articles from Business 2 Community: