Buying power makes Hispanics key market

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Research shows that Hispanic buying power equaled $580 billion in 2004, making the demographic a difficult one for businesses to ignore. In 2005, the buying power of the U.S. Hispanic market was larger than the gross domestic product of Mexico.
Businesses that want to attract the Hispanic population should keep two things in mind, said Alecia Jones, president-elect of the Hispanic Chamber of Commerce in Colorado Springs.
“The most important thing is to always have a bilingual person on staff,” she said. “Many Hispanic people now speak English as well, but they are more comfortable speaking in their native tongue. It is always a good idea to have someone who can speak Spanish, especially for the people who have trouble with English.”
The second: Don’t assume that all Latinos will respond to advertisements and marketing in Spanish.
“I’m a fourth generation American,” Jones said. “And I identify myself as an American first – not as an immigrant. If you are trying to reach people who are Hispanic-Americans, it’s a good idea to keep that in mind. We’re watching the same television programs every one else does, reading the same papers.”
Newly arrived immigrants watch Spanish language television, she said, but those who have been here for generations do not. Marketers should carefully target who they want to reach, she said.
Although Hispanics quickly become acclimated to life in the United States, they still retain their cultural identity, Jones said. Marketers can use English, but need to keep in mind that Latinos still maintain traditions and practices from their home countries.
“I was born here,” she said. “But I still relate to the culture my great-grandparents came from,” she said. “We tend to keep those traditions and cultures.”
The Hispanic market is lucrative, and businesses are scrambling to create ads to reach them. According to an Advertising Age survey, more than 81 percent of respondents expected their budgets for Hispanic advertising to increase. And the ads are moving online, with 65 percent saying they will increase online spending.
The influence of the Hispanic population is growing. National chains, such as Home Depot, work with the U.S. Department of Labor and Hispanic groups to provide jobs for Spanish speakers – and noted when they did, sales to Latinos went up as well. McDonald’s routinely runs a Spanish advertising campaign, with English subtitles.
In Colorado Springs, the number of Hispanic businesses is growing. The Hispanic chamber has 200 active members.
“We’re a pretty close knit community,” said Jones, who owns Auto Clinic of the Rockies with her husband. “If we need advice, we can get it from each other. Each business is different – they just need to decide what the target market is, then how to advertise to that market.”
The growth in Hispanic-owned businesses could translate into growth for service sectors, the businesses that help other businesses succeed – financial services, insurance and health care.
That market is largely unexplored in Colorado Springs. When she decided to set up her own business, Jones relied on nonprofit help from the Mi Casa Resource Center for Women. She also took classes at the Small Business Development Center.
Jones acknowledges the difficulty of setting up her own business.
“It was hard,” she said. “It took a lot of research, and a lot of help to make sure that we were getting started the right way.”
Jones said her business doesn’t market solely to the Hispanic demographic, but she said that speaking Spanish helps her with that market. In many ways, reaching the Hispanic demographic is no different than reaching other demographics, Jones said.
“You have to know your customers,” she said. “You have to recognize those needs and wants.”