The New Latino Consumer: The impact of Afro-Latinos in the Hispanic/Latino consumer market

By Derrick Raphael Pacheco – Department of Educational Leadership and Policy Studies, Florida State University

As one begins to explore the Hispanic identity, one realizes that there have been debates throughout history as to whether we should consider this group of individuals as a racial or ethnic group, when many members of this community identify as both. When it comes to Afro-Latinos, this unique subgroup of individuals holds a unique place in the Hispanic community for many reasons, one being the unique positioning they hold in being considered Black and Hispanic. Although we can conclude that not all individuals that identify as Afro-Latino may identify as Black, and vice versa, this unique subgroup of the Hispanic/Latino identity is one of the many “new” Latinos in the market. As highlighted in Korzenny et al., the makeup of the U.S. Hispanic market is everchanging, especially in comparison to the markets that are found domestically within Latin American countries. Although studies and environmental analysis’ have concluded that Afro-Caribbeans are the “most established foreign black group” in the United States, it is important to note that not all Afro-Latinos come from the Caribbean (Johnson, 2008, p. 78)

According to the Pew Research Center, there were roughly six million adults in the United States that identified as Afro-Latino, or two percent of the overall U.S. population and twelve percent of the overall population of U.S. Latinos (Gonzalez-Barrera, 2022). The Hispanic market in the U.S. is one that many marketers have tried to understand from a homogenous lens when it turns, to understand this homogenous market, there needs to be a clearer understanding and expectation of heterogeneous subgroups within the market (Korzenny et al., 2017). To better understand who our new Latino consumer is, we need to assure that we better understand the Afro-Latino community, while also acknowledging the specific countries and regions these Afro-Latinos come from. As mentioned in Korzenny et al., “Mexicans and Cubans are as different as Hispanics can be among themselves given their history” (2017, p. 57). Although there is a good representative number of Afro-Latinos having heritage in both Mexico (29% of all Afro-Latino adults in the U.S.) and Cuba (7% of all Afro-Latino adults in the U.S.), as well as other countries in Latin America (Gonzalez-Barrera, 2022), this shows the need to better understand the unique heterogeneous subgroups with the Hispanic/Latino market to better predict consumer behavior.

The Afro-Latino buying power is one that is understudied and under-analyzed by consumer databases. Although Gonzalez-Barrera (2022) explains that only one in seven Afro-Latinos identify as Hispanic or Latino, it is important to situate the Afro-Latino community within the larger Hispanic/Latino market, and one way of doing this is applying the percentages previously discussed to data points about the broader Latino market. According to a 2022 report from the Bureau of Labor Statistics, fourteen different categories of expenditures were analyzed to better understand consumer spending. These fourteen different categories were then analyzed using three racial/ethnic categories: Hispanic or Latino, White (non-Hispanic or Latino), and Black (non-Hispanic or Latino). Although it found that most consumers across all three groups spent the most money on housing, transportation, food, personal insurance and pensions, and healthcare, respectively (Bureau of Labor Statistics, 2022), some changes may be present due to the lived experiences of this heterogeneous group of consumers. Although an additional analysis of Black (Hispanic or Latino) would have been a better group to analyze as it relates to the consumer behavior of Afro-Latino individuals. To better understand how to market the same major product categories across groups, we need to understand these unique heterogeneous subgroups within the market.

The buying power of minorities has increased in the United States, with estimates of the buying power of the Latino and Hispanic market ranging from $1.72 trillion – $1.9 trillion dollars in 2020 (Melancon, 2021; Johnson, 2023). In contrast, the Black buying power in the United States rose to $1.6 trillion dollars in 2020 (Melancon, 2021) and is expected to continue rising exponentially as the U.S. market becomes more and more diverse. Although there are many different types of Latinos in the U.S. market, one of the most crucial subgroups that marketers need to understand to ensure that the Hispanic market is targetable holistically are the Afro-Latinos. As we can see, the number of Hispanic/Latinos who now identify as multiracial has increased from roughly three million people in 2010 to over twenty-seven million people in 2021 (Krogstad et al., 2022). Because of these steeply increasing numbers, we can tell that not only is the U.S. market becoming more diverse, but so is the Hispanic/Latino market. To ensure that marketers are equipped with tools to promote products and services to these diverse markets, they need to better understand the heterogeneous subgroups found within the larger market groups. Due to the ever-changing factors in society, defining what is the “new Latino consumer” is one that requires context and further exploration, but there are two things that are certain: (1) the new Latino consumer is becoming more and more diverse and (2) to better understand this homogeneous Hispanic market, marketers need to understand this heterogeneous subgroup made up of Afro-Latinos.

References

• Bureau of Labor Statistics. (2022, September 8). Average consumer expenditure in the United States in 2021, by Hispanic or Latino origin (in U.S. dollars) [Graph]. Statista. https://www.statista.com/statistics/694771/consumer-expenditure-by-hispanic-ethnicity-us/
• Gonzalez-Barrera, A. (2022, May 2). About 6 million U.S. adults identify as Afro-Latino. Pew Research Center.
  https://www.pewresearch.org/short-reads/2022/05/02/about-6-million-u-s-adults-identify-as-afro-latino/
• Johnson, O., Cho, H., & Patwary, F. (2023). Online shopping orientations of Latino millennial generational cohorts. Journal of Consumer Behavior 22(1). 14-26. https://www.doi.org/10.1002/cb.210714
• Johnson, V. M. S. (2008). “What then, is the African American?”: African and Afro-Caribbean identities in Black America. Journal of American Ethnic History 28(1). 77-103. link.gale.com/apps/doc/A397136435/AONE?u=tall85761&sid=bookmark-AONE&xid=63ed24e3
• Korzenny, F., Chapa, S., & Korzenny, B. A. (2017). Hispanic marketing: The power of the new latino consumer. Routledge.
• Krogstad, J. M., Passel, J. S., & Noe-Bustamante, L. (2022, September 23). Key facts about U.S. Latinos for national Hispanic heritage month. Pew Research Center.
  https://www.pewresearch.org/short-reads/2022/09/23/key-facts-about-u-s-latinos-for-national-hispanic-heritage-month/
• Melancon, J. M., (2021, August 11). Consumer buying power is more diverse than ever. UGAToday.
  https://news.uga.edu/selig-multicultural-economy-report-2021/