Hispanic Market Trends
By Roger Selbert, PhD Vice President, Strategic Planning LatinWorks Marketing

As the American economy emerges from recession, so does a clearer picture of which industries, regions, products, services and markets were most severely affected. The Hispanic market was not among them. Spending by Hispanic consumers, and spending by savvy advertisers reaching out to them, continued to grow through the recent downturn (although not at the same explosive rates of recent years).

The Hispanic population is large, young, and growing. It now commands $630 billion worth of annual buying power, growing to $1 trillion by 2010. Advertisers, for their part, must continue to connect with one of the few growth opportunities that exists in good economic times and bad. Hispanic advertising expenditures topped $2.5 billion last year, from $2.22 billion in 2001; spending was up in every medium, particularly in television.

During a recession, Hispanic households have relatively low unemployment compared to the population at large. Hispanic households are also larger, on average, and younger. This means more kids and teens, markets that drive spending under all economic conditions. Of the 37 million U.S. Hispanics, a third are under age 18. In the next 20 years, the U.S. Hispanic teen population will grow by 62%, compared to 10% for teens overall.

Additionally, Hispanics are expected to exert their influence in a number of key U.S. markets. Hispanics make up over half of the Miami and San Antonio populations, nearly half of Los Angeles, a third of Houston and one quarter in New York. Chicago Hispanics numbered 1.4 million in 2000, up 68% since 1990.

Hispanic Middle Class Growth- The expansion of the Hispanic middle class is one of the dominant forces shaping economic life in the United States. Between 1979 and 1999, the Hispanic middle class grew 71.2% to 9.5 million, according to Census data. Hispanics also achieved impressive gin household income, educational attainment, and homownership. In 2000, for example, 64% of middle-class Hispanic households either owned or were buying a home, and 20% of all heads of household had bachelor's or advanced degrees.

According to Hispanic Business magazine, Hispanic households earning between $40,000 and $140,000 annually reached 2.5 million in 1999, or about one-third of all Hispanic households nationwide. Such homes tend to consist of primary families (husband and wife) with higher levels of educational attainment, and more wage earners per household (2.26 - on average, one wage earner more than low-income households). >

Members of the Hispanic middle class are quite diverse in their occupational backgrounds: about half are blue-collar, one-fourth are white-collar mid-level professionals, and another quarter are administrators and professionals.

As more U.S. Hispanics achieve financial success, the Hispanic middle class will almost certainly continue to grow in the coming decades. The U.S. Census Bureau projects that the number of Hispanic households will grow 36% over the 10-year period ending in 2010. Assuming annual growth of 3.6%, this projection actually is quite conservative; annual average growth the last 10 years has been 4.5%, and the Census Bureau underestimated the U.S. Hispanic population in 1990 and 2000.

Hispanic Consumers Are Responsive to Media, Ads, Brands- Thirty million Americans speak Spanish at home, and the U.S. Hispanic population is expected to top 43 million by 2010. No wonder that when other TV audiences are shrinking, Hispanic viewership keeps growing. Each week last year, according to Nielsen Research, an average of 3.7 million viewers watched Spanish-language movies or telenovelas on either Telemundo or Univision, an 8.7% increase over the year before. Both networks recorded double-digit ad-sales growth, even as the slowing economy has slashed TV ad sales elsewhere. Hispanic homes tend to watch more TV, on average, than other viewers. Their average prime time viewing per week (17 hours) is a full 30% more than the average of all U.S. households (13 hours).

According to the Hispanics Opinion Tracker study by People en Espa–ol, 38% of respondents would buy a brand advertised in both English and Spanish over one that utilized only one language. Hispanics are also more likely to look to magazine ads for ideas than the general population (38% vs. 22%). They also say their purchasing decisions are equally influenced by friends, neighbors and celebrities, while the broader audience tends to be less swayed by a famous face.

Hispanics exhibit impressive brand loyalty: 52% of those polled swear they are loyal to a particular brand, and 39% said they look for quality in a product before checking its price. A third regard shopping as relaxing, compared to just 8% of the general consumer population. According to the study findings, Hispanics are very Òaspirational,Ó and shopping for brands correlates strongly with externally-motivated behavior.