Latins: the most attractive market for your business
During the last decades, the panorama of consumers has changed drastically in the United States, this is because of demographic changes and the incorporation of new technologies which have forced businesses to look for new strategies in order to create products, prices, availability and market. One of the principal demographic changes is caused by the immigrants, especially Latins, which have a different behavior than traditional consumers of this country.
Nowadays, the Latin influence is very relevant, up to the point in which they should not be seen as a population change but as an economic opportunity for the development of businesses, as César Conde, president of NBCUniversal International Group and NBCTelemundo Enterprises, mentioned in 2016. For this reason, it’s very important to consider them as a prominent part of the market, especially for three main factors: quantity, economic power and education.
Amount of Latinos in the United States
The communities with more relevance in the United States are Latins and Asians, they compound 1 of every 5 habitants, whether born outside the U.S. or second/third generation in the country. In 2013, the population born abroad compounded the 13.1% of the total population, I n other words, 41.3 million immigrants, of which 28% came from Mexico, 9.6% from the Caribbean, 7.7% from Central America and 6.7% from South America, according to the study “Bringing vitality to Main Street: How Immigrant Small businesses help local economies grow” by the Council of the Americas and the Fiscal Policy Institute.
Latins living in the United State are 28 years old in average, and the states with the highest amount of Latins residents are California, Texas and Florida, followed by New York, Illinois, Arizona, Colorado and New Mexico. At the present time, Latins embrace 18% of the total population, which equals to 57 million of habitants. The forecast for 2040 is Latins reaching the 24% of the population and 105 million in 2050, which means one quarter of the total population according to the census data.
According to the report “Understanding the Hispanic Market” published by NewBrunswickToday, Latins have a high purchasing power and tend to be loyal to brands, especially when marketing efforts are aimed for them. According to information provided by the Council of Americas and the Fiscal Policy Institute, considering Main Street Business, referring to stores located on the main streets of small cities, 20% of foreigners owning this type of businesses are Latins, and 5% are owned by US borne Latins.
As consumers they have a purchasing power of $2 trillion dollars annually. Their enterprises generated 857 billion dollars in 2016 and they employed 4.7 million workers, according to the same study.
On the other hand, the poverty rate among Latins is reducing faster than in the rest of the population. It fell 2.2 points from 2014 to 2015, while the national average was 1.3, and they are the only ethnic group with less poverty now than in 2007, according with NERA Economic Consulting.
In the same study reported by NERA Economic Consulting, Latins average education is increasing. In 1980, 56% of Latins did not have a high school degree, this indicator reduced 34% from 1980 to 2015, and the dissertation rate went down by 75%. In the same period, the proportion of Latins with College degree rose from 22 to 39%, and the college enrollment increased by 25% between 2013 and 2014 according to the National Center for Education Statistics. Despite being Spanish their native language, 94% of them speak English and 69% are competitive in this language.
In our days, the panorama of consumers is more multicultural than ever, which is why companies cannot settle by producing only one product for all the markets. Latins are turning around the US’s market not only with their economic power and number of habitants, but also with their influenc in music, politics and business.
It’s very important to adjust and make the pertinent changes to take advantage of this new growth opportunity. Can you use this information in your business? Are you willing to expand to the Latin market? Which strategies can you apply to reach this market?