Discover: Hispanics

by Stephen Palacios / Added Value

The term ‘Hispanic’ broadly refers to the culture, peoples or nations with a historical link to Spain. Commonly in the United States ‘Hispanics’ or ‘Latinos’ are referred to as being people who trace their origin or descent to Mexico, Puerto Rico, Cuba, Central & South America and of course Spain and other Spanish cultures.

According to the U.S. Census Bureau there were roughly 54 million Hispanics living in the United States in 2013, which represented approximately 17% of their total population and made them the largest ethnic subgroup in the country. The U.S. Hispanic population for 2060 is estimated to reach 128.8 million, constituting a staggering 31% of the U.S. population by that date.

As Hispanics grow in number and thrive in the U.S., it is useful for marketers to think about how they are reconciling their ethnic heritage with their U.S. identity; shifting and transforming the broader cultural norms in the U.S. across a wide variety of categories. The most familiar signifiers of Hispanic heritage are the fairly obvious ones, for instance language and food. Hispanics are often bilingual and they should be given a choice as to what they view or read – simply translating ads and websites into Spanish won’t cut it. Toy manufacture Mattel successfully targeted Hispanic children by creating a bilingual campaign for its ‘Toy Feliz’.

Many Hispanics consider fresh foods to be an indicator of quality and health. And preferring to cook from scratch they place high value on fresh foods, spending more than the national average on fresh produce and grocery products. Retailers will benefit greatly by acknowledging these shopper preferences, particularly in the grocery retail market.

But there are deeper elements of culture that relate to Hispanic values which are not as overt, but are still relevant for marketers to recognise. These include hierarchy, authority and collectivism. As well as having more defined gender roles (machismo and marianismo), stronger religious beliefs and clear family values they consider immediate, and extended family as a collective, rather than as individuals.

Most in-acculturated, the older generation of Hispanics moved to the U.S. to pursue a better life. The majority of Hispanics, in contrast to the same economic segment in Latin America, are financially better off and can afford things that they would have never been able to buy in their home countries. Hispanics are expected to spend an astonishing 1.5 trillion U.S. dollars this year, a 50% increase from 2010. This new purchasing power is precisely what makes Hispanics an attractive large segment in the U.S. for brands to hone in on.

Tech and mobile brands especially have a strong potential gain. “U.S. Hispanics are ahead of the curve when it comes to digital. They lead in adoption of new devices, and are the power users of mobile and over-index in video consumption” says Lisa Gevelber, Google’s Vice President of Americas Marketing. The average Hispanic spends more than eight hours watching online videos each month, 15% more than other consumer groups in the U.S, and YouTube views of Hispanic channels are on the up. Taking this into consideration, as well as understanding that over 65% of U.S. Hispanics are Gen Y, it’s no wonder that global media and entertainment company Universal has a dedicated Latino channel on YouTube, just one clip generated more than 6 million views.

U.S. Hispanics are often perceived as one big group, but researchers should be aware that it’s important to differentiate. Country of origin shouldn’t be overlooked and research should be assigned in different cities; there are more Mexicans in Los Angeles, Cubans in Miami and Puerto Ricans in New York. It’s also important to note that U.S. Hispanics and Latin American natives are very different, and shouldn’t be treated as the same demographic when targeting products.
Brands must be culturally relevant to enable growth. The rise and popularity of Hispanics and their cultures will only increase. It should be on the radar of every CMO wanting to succeed in the American market and be at the top of future marketing agendas.

Stephen Palacios, is Added Value’s research expert within the Hispanic market and has a column in Huffington Post.