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The 48 million Latinos in the United States now wield buying power in excess of $1 trillion and represent an increasingly important consumer segment for marketers in a post-recession economy. While overall spending by non-Hispanic consumers declined during the recession, Latino consumers as a whole spent more. Compared to other Americans, Latinos continue to exhibit more confidence about the future of the American economy and show more optimism that their own personal financial situation will improve in the days ahead.
This new Packaged Facts report provides an in-depth look at the shopping habits and spending patterns of Hispanic consumers today. It also provides a glimpse into Latino shoppers of the future. As more acculturated Latinos become an ever-larger share of the population, marketers may need to address the potential for a significant change in the profile of the Latino consumer. This Packaged Facts report provides important insights into the way acculturation may affect the shopping behavior and buying decisions of Latinos in the years to come.
The report begins by identifying trends shaping the Hispanic market and highlights opportunities created by the spending patterns of Latino consumers. The next chapters in the report assess the size and growth of Hispanic buying power through 2015, provide a demographic profile of Latinos and analyze trends in immigration and acculturation within the Hispanic population. The report continues with an analysis of the financial status of Latino consumers and overviews of their shopping and spending patterns. The next chapters of the report provide in-depth analyses of the spending habits of Latino shoppers in the areas of home furnishings and home electronics and fashion. The report concludes with a chapter on Latino shopping and spending patterns in supermarkets.
Market Insights: A Selection From The Report
Buying Power Used to Measure Market Size
This Packaged Facts report uses “buying power” to measure the size of the Hispanic market. Buying power is another term for “disposable personal income,” which is defined as the total after-tax income available to an individual to spend on personal consumption, personal interest payments and savings. Hispanics Show Increasing Economic Clout As a result of above-average population growth and improved earning power over the past three decades, Latinos have been responsible for an ever-growing share of consumer buying power in the United States. Packaged Facts estimates that in 2009 Latinos accounted for 9.1% of total buying power, compared to only 3.8% in 1980. [Figure 3-1]
Hispanic Consumer Units Profiled
Latino consumer units differ from non-Hispanic consumer units in a number of ways. Hispanic consumer units are larger, include more children, and are more likely to include multiple earners. They are more likely to be renters and less likely to have a college education. [Table 8-2]
Spending Patterns Differ
The spending habits of Latino households differ from those of non-Hispanic households. Food at home is one of the most prominent categories in which Latino consumers spend relatively more than other consumers. Latinos spend 9% of their household budgets on buying food to prepare at home, compared to the 7.5% spent by other consumer units.In the News
Economically Potent and Increasingly Acculturated Latino Consumers Spend More, Display Strong Financial Optimism
New York, December 21, 2010 — The United States population of Hispanic consumers wields a formidable combination of fiscal optimism and buying power in excess of $1 trillion, making progressively more acculturated Latinos a demographic capable of shaping the nation’s future economic and marketing trajectory, according to Latino Shoppers: Demographic Patterns and Spending Trends among Hispanic Americans, 8th Edition by market research publisher Packaged Facts. Hispanic buying power is projected to reach $1.3 trillion in 2015, a cumulative increase of around 25%.
"Although suffering their full share of job losses and foreclosures, Hispanic consumers are more optimistic than non-Hispanic white consumers about their own personal financial situation and about the future of the American economy," says Don Montuori, publisher of Packaged Facts. "Between 2008 and 2009 above-average growth in the Hispanic population caused aggregate spending by Latino households to increase slightly even as spending declined in non-Hispanic households. Considering that one in six Americans are now of Hispanic heritage, Latino consumers will remain influential over the ensuing years, especially because there are a significant number of high-income Latino households."
Marketers must be aware of how increasing acculturation will affect the decisions of Latino shopping behaviors. Compared to their low-acculturation counterparts, high-acculturation Latinos are much more likely to own credit cards, take out loans and have health and life insurance, according to the report. They are also less influenced by advertising and product placements but are much more alert to in-store promotions. Additionally, they are far more likely to shop and buy online and from catalogs. Packaged Facts further reveals that more education leads to better paying jobs and increasing influence among high-acculturation Latinos, who are more likely than their low-acculturation counterparts to work as managers and professionals, are more likely to own their own homes, and are twice as likely to have a household income of $75,000 or more.
Although advertising campaigns have increasingly featured Hispanics and Hispanic themes, marketers targeting Hispanic consumers must recognize substantial regional differences in the composition of the Hispanic population. For instance, Latinos living in western and southwestern states tend to be of Mexican heritage, while Latinos in the Northeast have a much more varied country-of-origin background. With an estimated buying power of $616 billion, Latinos of Mexican heritage represent the single most influential segment of the Hispanic market. Mexicans in the U.S. account for 59% of all Hispanic buying power. On a per capita basis, however, Cubans are the most affluent of the major Hispanic population segments.
Latino Shoppers: Demographic Patterns and Spending Trends among Hispanic Americans, 8th Edition provides an in-depth look at the shopping habits and spending patterns of Hispanic consumers today. It also provides a glimpse into Latino shoppers of the future. As more acculturated Latinos become an ever-larger share of the population, marketers may need to address the potential for a significant change in the profile of the Latino consumer. This Packaged Facts report provides important insights into the way acculturation may affect the shopping behavior and buying decisions of Latinos in the years to come.
About Packaged Facts—Packaged Facts, a division of MarketResearch.com, publishes market intelligence on a wide range of consumer market topics, including consumer goods and retailing, foods and beverages, demographics, pet products and services, and financial products. Packaged Facts also offers a full range of custom research services.
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