Hispanics Value Of Trust.

Today’s U.S Marketplace consists of approximately 43.5 million Hispanics, who by 2009 are estimated to reach $923 billion of annual buying power . This statistic alone illustrates the importance of the Hispanic market in both the U.S and global marketplaces. This diverse, ever growing and evolving population poses several complex issues when conducting business and marketing. Being aware of issues such as levels of acculturation, language preference and translation, and the understanding of cultural archetypes, could determine the difference between success and failure. Marketers and business people must take these issues into account when dealing with the Hispanic population.

In order to gain further insight into some of the issues that companies face when dealing with Hispanics, I spoke with Mr. Henry Martinez, Executive Vice President and Managing Director of Discovery Networks-Latin America/Iberia. During our conversation he was able to share some of his experiences. According to Mr. Martinez, Discovery does business with just about every Spanish speaking country, but the majority of his time is spent dealing with Mexico, Argentina, Spain, and with U.S Hispanics. He emphasized the fact that Hispanics tended to place greater value on relationship building and trust, rather than a legal document or even at times, price sensitivity. Trust is a very important issue. When asked about the legal and economic environment in Hispanic countries, gaining client trust is one of the main concerns. Although it is hard to generalize, there is a certain level of risk involved when doing business with certain Hispanic countries.

One can conclude that inconsistencies among Hispanic countries’ legal and economic systems, creates a more volatile marketplace compared to a country like the United States. Marketers and businesses must understand the legal and economic history of the Hispanic population; especially the lesser acculturated population. Many Hispanics are not accustomed to trusting their countries legal and economic systems. In fact, many of them come to the U.S in order to protect their family wealth and/or business. Mr. Adolfo Franco, Assistant Administrator for Latin America and the Caribbean at the U.S. Agency for International Development, says that Latin America’s crime rate is double the world average. Mr. Franco indicated that this high incidence of crime is taking a toll on the region’s economic development and public faith in democracy. It is thus easy to make the assumption that trust and relationship building is valued highly by Hispanics, especially when coming from such volatile circumstances. During a recent presentation at Florida State University, Ray Celaya, V.P of Procurement for All State Insurance, mentioned how many of his agents were godfathers and godmothers to their clients children, as a result of the trust and relationship that they had established. Rahul Gedupudi, COO of ITELS (www.itels.com), a leading information technology and business process outsourcing firm based in Chicago, with operations centers in India, says that “when it comes to meeting times and punctuality, Hispanics in my experience are more lenient. Establishing trust is very important in doing business, and attention should be given to gaining and maintaining trust. They are also very personable.”

Marketers and business people must emphasize the development of trust with Hispanics. It is important not only to understand their culture, but also to research the legal and economic history of their Hispanic target market, regardless of socioeconomic status.

Jorge Soto
Florida State University

References:
1a. .http://juantornoe.blogs.com/hispanictrending/2004/10/hispanic_buying.html

1. http://usinfo.state.gov/dhr/Archive/2005/Apr/21-965427.html
2. Synovate, 2004 Hispanic Market Research Report.
3. Celaya, Ray. “Successful Multicultural Marketing” Florida State University , Tallahassee, FL. 30 Nov. 2005.
4. Martinez Henry. Interview with Jorge Soto. International Hispanic Marketing and Business. Dec. 2005.
5. Gedupudi, Rahul. Interview with Jorge Soto. Doing Business with Hispanics. Dec 2005.