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Hispanic market purchasing power reaches $180 billion.

According to the U.S. Bureau of the Census' most recent count, the number of Hispanics reached 22,354,000 in 1990, which reflects a dramatic 53% increase over the past decade (roughly nine times the growth rate for whites and four times the rate for blacks). Hispanics are also steadily growing as a proportion of the total U.S. population, accounting for nearly 9% in 1990, up from 6.5% in 1980 and 2.6% in 1950. A widely held prediction is that they will comprise 11% of the U.S. population by the millennium and 13% by 2010. At that point, Hispanics will be tied with African Americans in numbers. They will also be well on their way to overtaking blacks as the largest minority group in the United States by 2015, when Hispanics are expected to represent about 15% of the U.S. population.

Aggregate Hispanic purchasing power (after-tax disposable income) reached approximately $180 billion in 1991, up 6% over 1990, according to a new study from Packaged Facts, Inc., the New York-based market research firm. Since 1980, Hispanic buying power has tripled, skyrocketing from $60 billion to its present $180-billion level, with the greatest growth occurring during the "boom years" from 1984 to 1988. With the turn of the decade and the current recession, annual growth has slowed to 6%, a still-respectable rate but a marked decline from the double-digit growth rates of the 1980s. The old Latin motto of the United States "E Pluribus Unum" (One out of Many), perhaps best expresses the paradox underlying the Hispanic market: it is at once highly diverse and unified. From a demographic point of view, the Hispanic population is not one market but a collection of several distinct market segments, clearly differentiated on the basis of several factors. These include: country of origin, regional residence, economic status, facility with English, social customs, political perspective, age, and education. Even in terms of Hispanics' shared language, dialect and pronunciation are vastly different depending on the country of origin. Indeed, the term "Hispanic" is a highly generalized ethnic designation that loosely refers to U.S. citizens or residents who are Spanish-speaking or of Spanish, Portuguese, and Latin American descent.

The rapid growth of the Hispanic population is the most important factor behind their growing purchasing power. According to the Bureau of the Census most recent count, the U.S. Hispanic population reached 22,354,000 in 1990, which reflects a dramatic 53% increase over the past decade (roughly nine times the growth rate for whites and four times the rate for blacks). Most of the increase over the past decade is attributed to immigration, which accounted for an estimated 62% of growth between 1980 and 1988. The Census Bureau goes on to predict that the Hispanic population will increase by 38% and 30% over the next two decades, respectively, reaching 30 million by the year 2000 and 40 million by 2010.

Hispanics are also steadily growing as a proportion of the total U.S. population, accounting for nearly 9% in 1990, up from 6.5% in 1980 and 2.6% in 1950. A widely held prediction is that they will comprise 11% of the U.S. population by the millennium and 13% by 2010. At that point, Hispanics will be tied with African Americans in numbers. They will also be well on their way to overtaking blacks as the largest minority group in the United States by 2015, when Hispanics are expected to represent about 15% of the U.S. population.

David A. Weiss, Packaged Facts president, is confident that Hispanics' increasing share of the U.S. population will have a major impact on the market, both in terms of marketers and consumers. He comments: "The old adage, |the more the merrier,'certainly applies here; being identified as the first or second largest minority group in the United States is, in itself, a powerful phenomenon. By 2015, the projected size of the non-European population as a whole means that soon, we will be probably thinking simply in terms of groups' instead of majorities and minorities. At that point Hispanics are likely to have a 15% share, which will make them one of the largest groups, period. At some point between now and then, this long neglected market segment will simply be too big to ignore, and it will get the attention f rom marketers it so richly deserves.

Currently, Hispanics purchase more food and other nondurable goods than any other type of product or service. Trade sources report that Hispanics spend 35% of their collective income, roughly $65 billion, on food and nondurables, a higher proportion than any other population group. Meanwhile, fully half of their income ($92 million) is spent on services, while just 15% ($28 billion) is spent on durable goods. Nearly all of the strategies used for marketing to Hispanics are determined in advance by two fundamental considerations: the intense geographic concentration of Hispanics (by region, state, city, and neighborhood), and their strong commitment to preserving and propagating the traditional values of Latin American culture in the United States. The geographic factor means that segmentation is essential in any marketing strategy, while the socio-cultural factor suggests that marketers must constantly be sensitive to Hispanics' strong adherence to |traditional values. These encompass a firm commitment to family, religion, and the Spanish language, which Hispanics see as being fundamentally important in creating unity among themselves and reinforcing strong family values. As Mr. Weiss points out, "For the most part, targeting Hispanics means targeting families, since eight out of ten Hispanic households are considered family households.' It therefore behooves marketers to go after Hispanics with products and promotions that have both child- and adult-appeal."

The Packaged Facts study, THE HISPANIC MARKET, is over 175 pages long and broken out into five sections: Demographic Overview, The Market, Marketing to Hispanics, Marketer Profiles, Advertising/Promoting to Hispanics, and The Hispanic Consumer.

Information about THE HISPANIC MARKET, which costs $1,750 is available from Packaged Facts, Inc., 581 Ave. of the Americas, New York, NY 10011.
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Publication:Frozen Food Digest
Date:Jul 1, 1992
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