Wealth is soaring among fast-growing Hispanics — yet 56% have no bank accounts

When National City Corp. bank decided to roll out 78 new branches in Chicago two years ago, it went in knowing its market. With Hispanics expected to account for virtually all of the city’s population growth over the next decade, the bank hired dozens of Spanish-speaking staffers and printed thousands of glossy pamphlets, hawking savings accounts to new immigrants and explaining the benefits of IRAs to more established Latinos. This year, the nation’s 10th-largest bank will double its Hispanic marketing budget, targeting middle-class Latinos with direct mail offering mortgage financing and money-market accounts, all written en español. “A simple hello in Spanish,” says Christian Sandoval, vice-president of Hispanic marketing at National City, “can open the door to a Hispanic better than a product with a 4.5% interest rate.”

From Bank of America Corp. (BAC) to Banco Popular, tapping into the growing Hispanic market is increasingly key for U.S. financial institutions. Indeed, U.S. banks may soon go on a shopping spree in search of smaller regional players with ties to Latino communities. They’d better hurry: Foreign banks such as Spain’s Banco Bilbao Vizcaya Argentaria have already snapped up banks in Texas, California, and Florida. Now, predicts Jack M. W. Phelps, senior financial analyst for the the Federal Deposit Insurance Corp., “we’ll see domestic banks buying small Hispanic-oriented banks to acquire their skills.”

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Strategic Research Institute announces
the 11th Blockbuster Marketing to U.S. Hispanics and Latin America Conference
scheduled to take place in Miami Beach on January 24-27 at the Wyndham Miami
Beach Resort. The latest addition to the program is Brigadier General
(retired) Bernado Negrete from the United States Army. This comprehensive
agenda includes leading luminaries in the field of strategic planning,
research, advertising, PR, segmentation and target marketing, media planning
and buying, creative, direct marketing and grassroots outreach. This
successful series has a track record of being the premier conference in the
industry in terms of its content, networking opportunities and high-caliber of
attendees.

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This year has been a boom one for Spanish-language media in the United States, which has seen the birth of new publications as well as mergers and purchases involving large corporations.

Even as the circulation of English-language newspapers continues to decline slightly, the Spanish print media are thriving, both in number and in dollar figures.

According to the magazine Hispanic Business, between 2000 and 2003, the number of U.S. Hispanic publications grew 14.2 percent, spurred in part by the 2000 census’ revelation that the nation’s 38 million Hispanics now constitute its largest minority.

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A North Texas food distributor that ships grocers imported products from south of the border said it plans to open several club stores in Dallas and Fort Worth.

Dallas-based La Familia Distributors plans to expand its 12-state distribution by opening six stores that will offer products and groceries such as candies, laundry detergents, pastries and drinks from Mexico. The plan will put La Familia into retailing for the first time.

A 2000 Census report by the North Central Texas Council of Governments stated that Hispanics make up 21 percent of the population in the Dallas-Fort Worth area.

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The leading 5 DMAs accounted for slightly more than 51 percent of all Hispanic advertising expenditures. The top-five DMAs have shown strong and consistent growth over the past five years. Los Angeles, Miami, New York, Houston, and Chicago have had a combined media revenue growth of 24 percent. The Chicago DMA is expected to lead the way with over the next few years with an anticipated ad spending growth rate of more than 50 percent. Los Angeles and Houston will not be far behind however, with 40-plus percentage increases expected in the coming years.

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Miami-based Bela Broadcasting, a Spanish language television programmer and independent station operator, purchased former NBC affiliate KMOH-TV last month from Gannett Communications for $5.25 million to tap the growing Hispanic market in Las Vegas as well as Phoenix.

With Hispanics comprising 26 percent of the valley’s 1.7 million people and spending about $33 million weekly on goods and services, the latest entrant to local Hispanic media further demonstrates the demographic shift in the local market. It’s a shift that has forced advertisers and their agencies to accommodate the swelling niche by servicing it.

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Marketers and advertisers will gather in sunny Miami during April 2005 (6th and 7th) to examine successful strategies being used to reach Hispanic consumers in the USA, at the third annual Innovations in Hispanic Marketing conference. The conference organiser, MFM Trade Meetings, promises addresses from experts in acculturation and market segmentation, brand management and strategic partnerships, as well as entertainment and new media. In case studies and panel presentations, conference speakers will show how many companies are currently increasing market share and deepening brand loyalty among Hispanic audiences. Speakers will come from a range of industries including food & beverage, healthcare, telecom, automotive, consumer goods, retail, cosmetics, consumer electronics, home products, financial services, media and entertainment, internet, transportation, and pharmaceuticals.

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Latinos are the nation’s fastest-growing ethnic group and are an attractive market segment for grocers because they often have larger families than other demographic groups. More mouths to feed means more groceries to buy.

Arizona’s Hispanic households spend an average $5,648 annually on groceries, while non-Hispanic households average $5,288, according to Phoenix-based Behavior Research Center.

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Managers at Cary Towne Center say a growing number of shoppers speak Spanish so it’s critical Santa can connect with all the children.

“It makes a big difference to see a child wandering…standing there, wishing to be close to Santa and before you know it he’s sitting on Santa’s lap and Santa is speaking Spanish to him,” Santa added. “That’s his language [and] he does not question it.”

Whether it’s in English, Spanish or French, Santa listens carefully to each request. While Barbie and Spiderman top the list of most young children, Santa says most of the older children ask for something bigger.

“This year, more than any other year, I’ve got more requests for peace on earth,” he said.

It’s a gift all of us could ask for this Christmas, no matter what language you speak.

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Note: In the words of former South African president Nelson Mandela, “If you talk to someone in a language he understands, that goes to his head. If you talk to him in his language, that goes to his heart.”

[Spanish-speaking] travelers now enjoy a better, faster and friendlier airport experience with Delta Air Lines’ new Spanish-language automated gate announcements and select information on Delta’s Gate Information Display Screens (GIDS).

Starting Dec. 14, Delta gates in 34 U.S. airports will have the ability to play automated gate announcements in English and Spanish. Automated gate announcements will always be played in both English and Spanish in select cities and for all Delta-operated SkyTeam and Avianca codeshare domestic flights. Beginning in January 2005, display screens in Delta gate areas will also provide select information in Spanish, such as showing proper stowage instructions for carry-on baggage.

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Lexicon Marketing, developer and marketer of Inglés sin Barreras, a video-based English learning program, has increased its advertising investment from $12.56 to $75.00 million in little over a year, and is now challenging the venerable Procter & Gamble for the top [advertiser in the Hispanic market] position.

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Total monies spent by the top-50 advertisers to reach the U.S. Hispanic market have grown more impressively than the overall market itself despite slowing in growth in recent years. From 2000-2004, dollars spent by the top-50 advertisers grew from $658.37 million to $1.23 billion, an 87 percent increase. The dramatic increase in advertising expenses serves as an indirect indicator of advertising investment satisfaction by existing advertisers.

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The Internet Advertising Bureau’s Hispanic Committee, comprising executives from companies such as Univision and Yahoo!, estimates that U.S. online advertising to Hispanics will reach $75 million this year, up 67 percent from 2003. Advertisers spent just $10 million in 2002, the bureau estimates.

Committee Chairman Peter Blacker, vice-president of multicultural and international advertising for AOL Media Networks, sees strong growth in 2005 as well. “I think the market is trending to well above $100 million for next year,” he says. “We’re seeing in our space right now sort of the go-go years of the ’90s.”

A strong selling point is the number of Hispanics who are going online at home. According to the 2004 AOL/RoperASW U.S. Hispanic Cyberstudy, 20 percent of U.S. Hispanic Internet users have been online at home for less than six months, compared with just 6 percent of general at-home Internet users. A separate report by Synovate predicts that by 2010, 62 percent of U.S. Hispanics will have access to the Internet at home – up from 45 percent this year.

Besides being a fast-growing Internet market, Hispanics also are spending slightly more time online than the general market. A 2003 study by the UCLA Center for Communication Policy determined that Hispanics spend 11.6 hours per week online, compared with 11.0 hours among non-Hispanics. The difference is greater at home, where Hispanics spend 9.8 hours per week online while non-Hispanics spend just 8.1 hours on the Internet, the study found.

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Double-digit gains in Hispanic advertising expenditures were made in all media, but television continues to garner the majority of all ad dollars. Television ad spending accounted for more than 64 percent of all expenditures in 2004. Nearly all media examined are predicted to exhibit double digit growth through at least 2007.

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Spending power of the nation’s largest ethnic group is growing at thrice the general population’s.

Marketing geared toward Hispanics has reached $3 billion so far in 2004, up 11 percent from last year.

That number is expected to rise to $3.6 billion by 2007, according to Hispanic Business Inc., which released “U.S. Hispanic Media Markets Report, 2000-2007” earlier this week.

“The Hispanic market is growing faster than the (general) market,” said Juan Solana, chief economist of HispanTelligence, the research division of Hispanic Business Inc.

Solana said that the spending power of the general population of the U.S. has risen 2.8 percent annually over the past decade, while Hispanic spending power has risen 7.5 percent.

In 2004, Solana said that the spending power of Hispanics in the U.S. is $700 billion and that it’s expected to reach $1 trillion by 2010.

The 2000 census is a major contributor in the surge of Hispanic marketing. Advertisers realized they had “a largely underserved” market of 35 million, Solana said.

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The U.S. Hispanic population has since risen to 39 million, according to census estimates.

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