The Power of Culture
Finding Ethnic Consumers in Neighborhoods Where They Live and Work
One of the largest changes impacting businesses today is the rapid growth of the multicultural marketplace. In 2008, one-third of the U.S. population was Hispanic, Asian, or African-American. By 2050, that percentage is predicted to reach over 50 percent.
In fact, in June 2008, the U.S. Census Bureau chief, Steve Murdock, made the following statement: "The diversification of the population is another major factor impacting the U.S. One of the reasons that I say that Texas is a barometer of the country is that if you looked at Texas in 2000, about 53 percent of the population was non-Hispanic white or Anglo. By about 2040 that is the percentage that the Census Bureau projects to be the case for the country as whole."
The growing multicultural sector of the U.S. already generates nearly $1 trillion in spending power. And this spending is largely culturally influenced. To market to people within any cultural groups requires, of course, understanding their purchasing influencers.
Another equally critical factor is knowing where people of different cultures live and work. This is becoming a bigger challenge as the population expands and migrates to new locations. This white paper discusses the power of culture in market research. And it reveals a powerful solution that gives consumer-focused businesses the ability to track multicultural population shifts - STI: PopStats™, today's leading population-estimating product.
Identifying the Fastest Growing Ethnic Demographic
Can you identify this U.S. consumer group?
They are 10 years younger than the average U.S. resident. Fifty-seven percent are married (compared to 50 percent nationally). Their family size is 3.1 compared to 2.3 nationally. They earn an average annual income of $34,000 (compared to $48,000 nationally). Twelve percent have college educations (25 percent nationally). Sixty-seven percent are Catholic (25 percent nationally). Their buying power is growing at an annual rate of 8.2 percent (compared to 4.9 percent). By 2020, they are estimated to become almost 20 percent of the population (over 60 million) and generate over $1 trillion in consumer spending alone.
These are just some of the demographic factors available about the country's largest growing sector - Hispanics (also called Latino). Studying this consumer group has become a big business in itself as it continues to expand and become a major force in the U.S. economy. And for good reason: In the past decade (since 1996), the Latino community in the U.S. has doubled in size and become a major national influence in everything from music to food, clothes, books, and movies.
"Hispanic" or "Latino" are terms that describe people who speak Spanish in all or part of their daily interactions; participate in holidays and special events specific to Spain, Central or South America, or the Caribbean; possess cultural beliefs, behaviors, or other factors commonly attributed to people from these areas; and are descendants from countries in these regions. In the U.S., people of Mexican origin represented the largest group of Hispanic Americans (66.8 percent), followed by people from Central and South America (14 percent), Puerto Ricans (8.6 percent), Cuban Americans (3.8 percent), and other Hispanic groups (6.5 percent).
Cultural Influences in the Hispanic Population
It seems that businesses today cannot learn enough about what makes Hispanic consumers tick. A search on the Internet will call up thousands of Web sties where the Hispanic marketplace is being discussed, analyzed, and strategized. However, as anyone who has ventured into multicultural marketing knows there are few easy solutions to identifying the buying habits, attitudes, and trends of any demographic sector.
Also, stereotyping a group is never a good business strategy. After all, most Europeans think that all Americans eat at McDonald's everyday. However, while it is not wise to lump any group into a form-fitting mold, there are some general ideas that shape every culture.
What's more, the Hispanic community is experiencing a different process of acculturation than did the immigrants of the 19th century. In the past, immigrants faced an imperative to assimilate to survive. Today's immigrants, however, are not limited in their choices or their opportunities. In fact, it is no longer necessary for immigrants to sacrifice their cultures and languages to fit in. Maintaining their culture, rather than assimilating to the dominant culture, greatly impacts the purchasing habits of every cultural group.
Here are a few distinctions that shape the vast and diverse Hispanic culture:
Locating the Fastest-Growing Demographic
Even more challenging than pinpointing the demographic characteristics of this diverse group is studying the geodemographics of Hispanic consumers: In other words, researching exactly where Hispanic consumers live and work across the U.S. In the past, market researchers could more easily pinpoint ethnic neighborhoods, because they tended to be well defined and consistent from year to year.
For example, the following six cities have long been home to the largest communities of Hispanics (population counts from 2006):
Today the U.S. melting pot is becoming much more of a blended stew as demographics change and shift from neighborhood to neighborhood. As a result, unlike in the past, today the cultural mix of any neighborhood could change within the space of a few years. For example, the Latino community is rapidly increasing in size and scope in areas such as the Midwest. Further, in communities where it previously had a minimal impact it is now becoming a significant influencer in both the public and private sectors.
Here are just a few facts illustrating the growth and change of the Hispanic population:
STI: PopStats - Tracking Today's Changing Marketplace
How will consumer-focused businesses find Hispanic customers and track their growth across the U.S.? STI: PopStats data offers a powerful solution.
STI: PopStats is uniquely positioned to give businesses the power to track geodemographics at the neighborhood level - including cultural data. STI: PopStats is able to keep its finger on the pulse of neighborhood demographic changes by tracking population shifts at the zip+4 level and by tracking population changes quarterly. This gives consumer-focused businesses the ability to achieve several important business goals including:
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Nearly all U.S. companies today need to think about how the rapid growth of cultural groups will impact their businesses. Employing tools, like STI: PopStats data, to track changing demographics within fast-changing communities is one of the smartest moves they can make. STI: PopStats data is uniquely positioned to track changes at the neighborhood level as they occur. This capability gives market researchers the power of immediacy in tracking demographic changes. As a result, researchers can more clearly see changes in their trade areas as they occur - including today's rapidly shifting cultural movements.
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