understanding the hispanic market august, 2004. 2 agenda u.s. hispanic facts and figures...

UnderstandingThe Hispanic Market

August, 2004

2

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

3

Hispanic Percentage of U.S. Population

25%

20%

13%

2002 2030 2050

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 African-American population as the largest minority group with 35.3 million Hispanics in the U.S.

The Median age of Hispanics is 28 vs. 37 for non-Hispanics.

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



Geography


Hispanic Segments




TMN Markets

5

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.

6

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.

7Source: The Urban Institute, Washington DC, 1998, in Valdes, I., Marketing to American Latinos, 2000

0

10

20

30

40

50

60

70

1995 2000 2005 2010 2015 2020 2025

2nd+ Generation

1st Generation

Foreign Born

Hispanic “Generational” Segments Will Continue to Grow in the Coming Decades

Mil

lio

ns

8Source: Strategic Research Corporation - 1994 & 2002 U.S. Hispanic Market

9%

25%

66%

Highly Acculturated

Partially Acculturated

Unacculturated

YEAR 2002

47%

34%

19%

YEAR 1994

Acculturation Segments

9

Equally19%

American First11%

Hispanic First70%

Source: Strategic Research Corporation - 2002 U.S. Hispanic Market

“Retroacculturation” “Do you consider yourself Hispanic or American?”

10Source: Valdes, I., Marketing to American Latinos, 2000 © 2002 Santiago & Valdés Solutions

Hispanic “Acculturation” Diversity Will Continue to Grow As Well

U.S. born First, second, third generation Brand, category “mature” Marketing savvy

Foreign-born Recent arrivals vs Long-term Brand heritage/ lack thereof Advertising, information “hungry”



Geography


Hispanic Segments




TMN Markets

12

HISPANICS WERE ALREADY THE LARGEST MINORITY IN THESE STATES

Source: Census Bureau, 2000; USA Today

Before the 2000 Census

13

HISPANICS BECAME LARGEST MINORITY IN SEVEN MORE STATES


After the 2000 Census

14

HISPANICS WILL BE THE LARGEST MINORITY IN THESE STATES


And in the 2010 Census

15Source: Census Bureau, 2000; USA Today

85% of Hispanics Live In Ten States

16Source: Census Bureau, 2000; USA Today

In the Top 10 Hispanic States, 46% Live in TMN Markets



Geography


Hispanic Segments




TMN Markets

18

Source: Strategy Research Corporation, 2002

Language Frequently Spoken at Home

74%

10%

16%

Spanish

Bilingual

English

19

Strategy Research Corporation, 2002

Language Most Comfortable Speaking

64%

15%

21%

Spanish

Bilingual

English

20Source: Strategy Research Corporation, 2002


28%

57%

92%

19%

17%

53%

26%

6%1%

Highly Acculturated Partially Acculturated Unacculturated

English

Bilingual

Spanish

21

Source: Strategy Research Corporation, 2002


15%

84%

22%

11%

63%

5%

U.S. Born Foreign-Born

English

Bilingual

Spanish

22

60%

60%

65%69%

58%

62% 64%

71%

1994 1997 2000 2002

“I am more inclined to purchase brands advertised in Spanish”

Source: Yankelovitch Hispanic Monitor, 2002

“I get more information about a product when it’s advertised in Spanish”

The Importance of Advertising in Spanish

23Source: Strategy Research Corporation 2002

Spanish is the preferred advertising language for the majority of Hispanic parents and grandparents

Heavily influencing under 18 segment

Adult Language Preferences in Advertising

ENGLISH 30% 44% 26% 29% 26%

SPANISH 55% 46% 58% 57% 62%BOTH 13% 10% 16% 13% 13%

TOTALLatinoAdults

YoungAdults(18–24)

Bebes,Niños

Parents(25–34)

Tweens,Teens

Parents(35–49)

Bebes, Tweens,TeensGrand

Parents(50–64)



Geography


Hispanic Segments




TMN Markets

25

19%19%

14%

16%

13%

8%

10%

HISPANIC POPULATION BY AGE BREAK

“New” LATINAS/LATINOS

1 in 3

Gen Ñ1 in 5

LOS BEBESY LOS NIÑOS1 in 5

LOS GRANDES

1 in 10

LATINBOOMERS

1 in 5

Age Cohorts Are Large Enough for Focused Sub-targeting Opportunities

26

0%

5%

10%

15%

20%

< 6 6-12 13-17 18-24 25-34 35-44 45-54 55-64 65-74 75-84 85 +

Hispanics

Non-Hispanics

Source: 2000 U.S. Census

Over a third (35%) of all U.S. Hispanics are younger than 18 years of age vs. 26% of the overall population

Population by Age Group (%)

27Source: Valdés, I. Marketing to American Latinos, PMP, 2000

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

28Source: Valdés, I. Marketing to American Latinos, PMP, 2000

Most being raised Bilingual and Bicultural

Los Bebés y los Niños

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

29Source: Valdés, I. Marketing to American Latinos, PMP, 2000 © 2002 Santiago & Valdés Solutions

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

30

Hispanic Youth (Age 0–19)“Generational” Segments

14% born outside the U.S.

54% first U.S. born generation to at least one immigrant Hispanic Parent

54%

33%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

US Born 2nd GenUS Born 1st GenForeign Born

14%

Source: Strategic Research Corporation, 2002

31

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

Sources: Nielsen Media Research, Visa’s Annual Back To School Survey

32Source: I.Valdes, “Marketing to American Latinos”, PMP, 2000

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)

33Source: 2002 Santiago & Valdés Solutions

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


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)


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)

36

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.

Source: I.Valdes, “Marketing to American Latinos”, PMP, 2000

37Source: I.Valdes, “Marketing to American Latinos”, (forthcoming, PMP, 2002)


“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

38Source: I.Valdes, “Marketing to American Latinos”, (PMP, 2002)


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



Geography


Hispanic Segments




TMN Markets

40

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

41

Latinos continue to Love Being Latino

Fundamental culturally based behaviors continue

Deeper consumer knowledge is required to effectively communicate

Advertisers need market experts


42

Values Communal, interdependent orientation Communal, interdependent orientation

centered on “La Familia Unida”centered on “La Familia Unida”

Legacy of human values, centered Legacy of human values, centered on loyalty, cooperation and on loyalty, cooperation and helping one anotherhelping one another

Respect, particularly for those Respect, particularly for those of a higher social status, their of a higher social status, their elders and the motherelders and the mother

Hospitality –“Mi casa es tu casa” Hospitality –“Mi casa es tu casa” – in which food is key element– in which food is key element

Religion Predominantly CatholicPredominantly Catholic

Cultural Identification Latinos identify with their country of originLatinos identify with their country of origin

Language Latinos speak Spanish with Latinos speak Spanish with

distinct national idiomsdistinct national idioms

Food Our Food is Us!Our Food is Us! Bonding Latino Bonding Latino

emotional mainstayemotional mainstay

Flavor Please!Flavor Please! The cuisines The cuisines differ slightly, but the requisite differ slightly, but the requisite is the sameis the same

Class Structure Latinos naturally accept a social Latinos naturally accept a social

pecking orderpecking order

American egalitarianism can be American egalitarianism can be unnerving, depending on their unnerving, depending on their social statussocial status

Source: Project “Corazon” 2001 - Kraft proprietary study

LatinoCharacteristics and Core Values

43

Source: Cultural Access Group

Non-Hispanic Hispanic

How do we relate to people?

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"

Differences in Values & Beliefs


44

Family Unity continues to be Imperative

Machismo(Man’s role)

LeadsProvides

Marianismo(Woman’s role)

Keeps family together

Chicoismo(Children’s role)

Family legacy

Acculturation:

• Surrender some power over the household

Acculturation:

• Awaken to the self

• Gain more freedom

Familismo(Family)

Source: Marketing to American Latinos, Isabel Valdes 1999

Acculturation:

• Gain more freedom

• Become self-reliant

Four Imperatives of Latino Culture



Geography


Hispanic Segments



Hispanic Population

46

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



Geography


Hispanic Segments



Hispanic Population& Media Usage

TMN Markets

48

Hispanic Population Have Larger Households

2.8

3.3

3.73.73.9

Chicago LosAngeles

Houston New York Miami

Average Persons Per Household(Top 5 Most Populous Hispanic Markets)

Source: 2002 Strategy Research Corporation.

49Source: 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

Hispanic Diversity of the Total U.S. and TMN Markets

Other10%

Puerto Rico11%

Guatemala4%

Total U.S. Market(38,628,652 people)

Chicago Market(1,603,761 people)

Mexico75% Mexico

66%


Other12%

Puerto Rico1%

Guatemala3%

El Salvador9%

L.A. Market(7,000,800 people)

Mexico75%

Other29%

Mexico14%

Cuba7%

Orlando Market(383,540 people)

Puerto Rico50%

Other25%

Honduras5%

Columbia12%

Mexico4%

Puerto Rico9%

Miami Market(1,719,474 people)

Cuba45%

N.Y. Market(3,971,345 people)

Puerto Rico34%

51Source: 2002 Strategy Research Corporation.

Acculturation Levels Into U.S. CultureBy Market

9%

71%

20%

5%

64%

32%

9%

68%

24%

5%

66%

29%

Highly Acculturated Partially Acculturated Unacculturated

Chicago

Los Angeles

New York

Miami

Acculturationby DMA

(% of adults)



Geography


Hispanic Segments



Hispanic Population& Media Usage

53

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

54%

156%

Total Adults Hispanic Adults

% Increasein Los AngelesPopulation (1980 – 2002)

L.A.’s HispanicPopulation 2002

7,000,818

understanding the hispanic market august, 2004. 2 agenda u.s. hispanic facts and figures...

Documents

hispanic facts

hispanic states

census bureau

hispanic market year

percent of hispanics

hispanics live

hispanic generational

largest minority group