Hispanic Income Trends: Implications for Marketing

The median income of Hispanic households has lagged behind the overall population of the United States for a long time and does not seem to be getting better. The largest difference since 1980 was in 1996 when the disparity was of $14,465 dollars (in 2008 dollars), according to the U.S. Census Bureau, Current Population Survey, Annual Social and Economic Supplements. Since 1980 the smallest gap occurred in 1981 with a difference of $8,573. The latest figures available are for 2008 show a difference of $12,390, a gap similar to gaps in the 1990's. See the historical trends table on the left.

The current gap probably reflects some of the social and economic issues that resulted from the downturn of the economy between 2007 and 2009. But there are uplifting news. My analysis of the American Community Survey data of 2008 shows that income differences are not evenly distributed in the population as shown below:

It is interesting to observe that the gaps between the overall population median income and that of Hispanics is largest at the higher income levels, and interestingly there are more Hispanics in the middle income categories than in the overall population. This is very revealing because for the majority of consumer products income levels between $25,000 and $60,000 are ideal, and that is the range in which there are more Hispanics proportional to their population. This alone is a very important reason for marketers to pay attention to Latinos.

Clearly, the fact that proportionally Hispanics have some more households in the lower end of the distribution and fewer in the upper end is not desirable. Nevertheless, where the sweet spot of most marketers resides, that is in the middle, Hispanics have higher representation. This is surprising and uplifting, and helps understand that Hispanics are not generally poorer but they are better represented where it counts for marketers.

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Magnet States for Hispanics in 2008: Marketing Implications

My analysis of the American Community Survey of the US Census Bureau for 2008 reveals that there are key states that experienced net in-migration of Hispanics from other States in the prior year. This is the most up-to-date information of what States Hispanics are moving to, and what States Hispanics are leaving behind. At the top of the gaining list are Texas, Colorado, Utah, North Carolina, Washington State, New Mexico, Oklahoma, South Carolina, Mississippi, Pennsylvania, Louisiana, Virginia, Arizona, Missouri, Indiana, Iowa, Massachusetts, Kentucky, Maine, and Maryland, in that order.

The States with the largest out-migration of Hispanics, in order of loss to other States, were: California, New York, Florida, New Jersey, Alaska, Illinois, Michigan, Rhode Island, Connecticut, District of Columbia, Nevada, Georgia, Ohio, Delaware, Nebraska, and New Hampshire.

These trends appear to confirm the continued dispersion of Hispanics throughout the United States to places that were not typically attractive to Hispanics in the recent past. Growth in States like Utah, North Carolina, Oklahoma, South Carolina, Mississippi, and Louisiana seems to uphold the trend that Hispanics are moving to States that offer job opportunities and a reasonable cost of living, even if these States were not atop of the Hispanic agenda in the past.

Those States losing Hispanics to other States are those who have experienced severe economic difficulties in the recent recession and/or are also expensive to live in, for example: California, New York, Florida, New Jersey, Nevada, Alaska, Illinois, and Michigan.

This analysis, however, does not include in-migration from other countries. Thus, one can not conclude from these data that there is no actual Hispanic growth in some States that are losing Hispanics to other States. The problem in conducting this type of analysis is that the American Community Survey does measure people coming in from other countries but not people leaving the country. That is because the US Census Bureau only interviews or administers questionnaires to people in the United States.

The list of States with largest in-migration, and that with the highest out-migration, with their respective net gains and losses are found below.

These tables can be reproduced and circulated but the analysis must be credited to this author.

Top Hispanic Gaining States from Other States

Top States Losing Hispanics to Other States

The implications for marketers are that marketing efforts dedicated to Hispanics will continue to be more at a National level instead of in just a few major markets. While those major markets are still large and worthy of much attention, smaller emerging Hispanic enclaves need to be considered and planned for. Further, as Hispanics continue to disperse in the United States their tastes and preferences will further contribute to the Latinization of the US. At the same time, however, more of these important consumers will be establishing contact with members of non-Hispanic communities and being exposed to touch-points that they did not attend to before.

Also, it should be noticed that States that welcome Hispanics will continue to benefit from their hard labor and work ethic. Those States who have ostracized them under the pretext of undocumented immigration are likely to continue to lose their attractiveness and the benefits that Hispanic presence brings.

While the culture and in many cases the language of Hispanics will continue to be of great importance to connect with these consumers, marketers will also need to understand the dynamics of evolution and change in the Hispanic community.

The Importance of Hispanic Heritage Month: Marketing and Self-Esteem

When we arrive in the United States we share in the experience of being Latin Americans in a new cultural environment. That is a shared experience, the experience of being different from the receiving culture, and the experience of slowly becoming different from the culture we came from. That means that we are not from here and not from there "ni soy de aqui ni soy de alla." We become part of a third culture, a concept I have discussed in an earlier blog.

What I mean is that part of our common identity is the shared experience of being of Latin American origin living in the United States. That shared experience contributes to a way of being, thinking, and feeling that differentiate us Latinos/Hispanics from everyone else.

Hispanic Heritage Month is meaningful to us, Hispanics or Latinos (depending on label preference), because it represents the celebration of that experience. The experience of being unique in this great country.

This celebration also has side benefits that are related to marketing. It enhances our self-esteem because it tells us we are legitimate while being different. Also, savvy marketers help by emphasizing the achievements and contributions of Hispanics in this Country. Those who understand the opportunity and talk to us honestly and and with candor can enhance their brands. It is because they are linking their brand with the celebration of our identity.

Comprehending the deep implications of how a brand can acquire emotional significance is related to understanding the way consumers feel about themselves. Hispanic Heritage Month is good for both Hispanics and sincere marketers.

Clearly, one celebration is not enough to create a link between the consumer and a brand, but it definitely is a step in the right direction.

I like seeing television shows in English television talking about the importance of Hispanics in the United States. I like seeing celebrations all over the country.

While we have many differences among those of us coming from the different Spanish speaking Latin American countries and Spain, we become united by the shared experience of language, history, relationship to the supernatural, and being unique in this great Country. It is the shared experience associated with our values and beliefs that we celebrate.

Why it is so difficult to do cultural advertising well?

Advertising, almost by definition is cultural. Advertising influences our culture. The culture influences advertising. Now, in a country with so many different cultures producing advertising that is meaningful to these diverse cultures is a challenge. While it is true that in some cases a single message may do well across cultures, many times the message would be more effective if it is customized to the target culture.

Many culturally directed ads are simply a manifestation of stereotypes and relatively trite. That is because the difference between objective and subjective culture is not generally known. That Hispanics have large families and that they are family oriented is true, but definitely overused, and almost stereotypically used in advertising. That Hispanics have an affinity for social gatherings is true, but also overused. These are all manifestations of objective culture. These are the cultural manifestations that we can observe. And because we can observe them we think these are the culture itself. But culture is much more than objective culture.

Subjective culture, however, is what we carry in our heads. These are our values and beliefs, for example, believing that our children will transcend us. That they are more important than us because they represent a step towards infinite eternity. That is subjective culture. When those values and beliefs are inserted in advertising they have a high probability of connecting with the consumer. That is, assuming that the rest of the message is actually honest and the product or service is valuable in itself. Thus making a product or service the one that embodies a feeling of pride, a sense of transcendence, the emotion of celebrating being alive, for example, can be much more powerful than the simple use of objective culture symbols.

So, why there is so much advertising that is sadly empty and simply innocuous? Because many in the advertising industry have not yet understood these issues. Many appear to think that simply convoluting a story and doing something to stand out in the clutter will do the job. Standing out is useful when what stands out is a central part of the message. Making the the story complex for the sake of creativity is not.

Clarity, honesty, directness, and having a good product or service to sell are key to good advertising. Creativity resides in parsimony. Simple elegance that as part of the message makes it emotionally powerful.

After all these years of doing research I have learned that Hispanic consumers are eager to connect with and believe honest advertising messages. So, it is our job to make that connection and believability available. We need to find the insights that make for the cultural occasion, for the cultural emotion that can surround our ideas, products, and services. This requires in-depth research. Research that digs deep into how people feel and think.

The process of account planning is precisely to make the voice of the consumer heard in the advertising context. But it is not necessarily the overt expression of what consumers say, but those subtle beliefs and perceptions that have been ingrained as part of the enculturation process. That which we bring from our childhood. As marketers and advertisers, our duty is to comprehend where the consumer is coming from so we can show we understand him/her. So we can better be of service.

Attitudes of Consumers in the Multicutlural Marketplace

As part of our ongoing series of reports supported by DMS Research, the Center for Hispanic Marketing Communication at Florida State University has released in March 2009 a new study of attitudes of consumers in the Multicultural marketplace.  The full report can be obtained at:  http://hmc.comm.fsu.edu.

The data in this report includes 39 attitudes and multiple demographics to provide a sense of how members of different cultural groups feel about select aspects of life and commerce. The list of specific attitude items is in the section dealing with overall trends below.

The data revealed a six factor structure that resulted in six factor score coefficient weighted indexes:

• Network Oriented or an inclination to use social media and being sociable
  
• Gay Favorable or a positive predisposition to GLT issues and people
  
• Sports Oriented or a favorable disposition towards sports
  
• Brand Lifestyle or strong positive feelings about brands
  
• Social Cultural Sensitive or empathy and openness to other cultures
  
• Marriage Oriented or strong feelings about the importance of marriage
  

The results indicate that Hispanics who answered the online questionnaire in Spanish (HS) are more likely than anyone else to be Network Oriented, and interestingly, that Non Hispanic Whites (NHW) are least likely to be Network Oriented. Hispanics who answered the questionnaire in English (HE) and Asians (A) are most likely to be Gay Favorable, while HS were most negative. Also HE and A are most Sports Oriented, while NHW are least sports involved. Brand Lifestyle is more prevalent among African Americans (AA) and least among HS. The most Socio Culturally Sensitive are HS, while the least are NHW. A are the most Marriage Oriented while HS and AA are the least.

Alternative explanations were explored with the data, by looking at gender and age groups, and

conclusions and implications were derived for marketing to these diverse groups. These findings

highlight the importance of considering attitudinal orientations when positioning products and servicesnin these diverse cultural communities. The results make it evident that not all members of the different major cultures in the US can be reached with homogeneous messages and ideas.  Find the report at: http://hmc.comm.fsu.edu

Start Planning for the Online Hispanic Marketing Course for this Fall 2009

While the Summer 2009 course on Hispanic Marketing has started and is closed you can plan for this Fall 2009.  Classes begin August and it is never too early to apply to secure your place.  Visit http://hmc.comm.fsu.edu for details on the online course.  

 

For application information, contact Jennifer Boss at inquiries@campus.fsu.edu.

 

THOSE INTERESTED ARE ENCOURAGED TO APPLY IMMEDIATELY AS REGISTRATION IS LIMITED.

BE SURE TO REGISTER SOON!