US Economy at Risk if Corporations Ignore the Impact of Hispanics in America
Hispanics in America influence the future of the US economy yet this conversation remains quiet as corporations grow more uncomfortable with this time-sensitive issue. The numbers speak for themselves. The lack of commitment in giving rise to the Hispanic community is so obvious that it is becoming irresponsible as the risk profile increases. Corporations know that Hispanics represent the fastest growing population (+$50MM) and workforce community in America. They are also aware that Hispanic-owned small businesses are growing at over twice the rate of the national average (est. +$350B revenue annually). On top of that, Latino purchasing power ($1.5T by 2015) is no mystery as there is growing tension in the boardroom with indecision about how to unlock this market segment. Regardless of the escalating “Latino factor” – corporations are not being proactive enough to engage with this valuable demographic that will represent 30% of America by 2050. As such, the US economy is weakening due to the lack of investment in the Hispanic Community that will soon dictate new business models and the ground rules for Wall Street analysts.
The following is intended to bring awareness to some of the tension points corporations can’t shake and that carry tremendous economic and societal implications if not solved immediately. The goal is to highlight a few trends that identify the opportunities that are being missed if US Hispanics continue to be viewed as a recurring expense rather than a strategic investment.
I. Hispanics Must Make Banking & Financial Planning a Priority
More than half of Hispanics expect to improve their financial situation over the next year, while little over a third of all Americans can say the same. Yet, when it comes to financial planning, or even every day banking and insurance needs, Hispanics are still in the minority.
For banks and other financial institutions, they must begin to recognize that conventional banking as we know it may not be part of the traditional Hispanic upbringing. This has led to a general mistrust of banks and, when coupled with a natural skepticism, would account for the $53 billion attributed to "unbanked" Latino households according to a study by a research arm of the University of Virginia's Darden School of Business (download report: PERDIDO EN LA TRADUCCIÓN: The Opportunity in Financial Services for Latinos). Read More About This Topic Here
II. Hispanics Lead the Recovery by Occupying Walmart, not Wall Street
Hispanic growth is fueling an increase in buying power in this country that is yet to be seen in other economies. According to Nielsen’s recent study, The Hispanic Market Imperative – it revealed that if US Hispanics were a standalone country, their market buying power would be one of the top twenty economies in the world.
Given this knowledge, it's surprising that so few retailers have put much effort into learning about the Hispanic consumer and how to serve their needs. One very prominent exception is Walmart, which has been attracting increasing numbers of Hispanics to their stores by integrating them into all facets of its business, including merchandising, marketing, operations, and community outreach programs. One campaign called "The Best Heritage is a Good Education" addressed the need for higher learning while acknowledging the importance of culture - displaying a genuine understanding of what's important to the Hispanic community. Read More About This Topic Here
III. Media and Entertainment Through the Hispanic Lens Brings a Paradigm Shift
In the world of media and entertainment, we are finally starting to see a positive shift in the portrayal of Hispanics. Cultural stereotypes are giving way to cultural authenticity. The attention usually given to Spanish-speaking Hispanics is turning to the English-speaking majority born in the United States. New Generation Latinos (NGLs) are making waves and changing the conversation. Not only are NGLs influencing traditional media, they are making Hispanics the biggest and fastest growing users of online and interactive technology, mobile devices, and social media.
Hispanics represent a huge opportunity for the news media, entertainment programmers, advertisers, online content creators - you name it. But captivating this trendsetting and game changing audience will take a different approach, one the industry is just waking up to. Unlike previous generations, largely here through immigration, NGLs are not looking to quietly assimilate. They expect mainstream media and entertainment to embrace and reflect their authentic voice and culture. Read More About This Topic Here
Note: On May 7th, ABC News announced its plans to join forces with Univision News to create a multiplatform news, lifestyle and information programming aimed at U.S. Hispanics.
IV. Hispanics Buy Brands that Empower Their Cultural Relevancy
There is a growing necessity for brand marketers to provide culturally relevant content and messaging that specifically targets US Hispanics. In fact, Hispanics are the largest immigrant group to exhibit significant sustainability of their culture and are not disappearing into the American melting pot. Now that we have confirmed that cultural sustainability matters to US Hispanics, companies must become more educated about the Latino community not just as consumers – but more importantly, as people and the identity we represent as a diverse community. They must recognize that Hispanics buy brands that empower their cultural relevancy.
Hispanics in America are growing tired of being the target of new marketing campaigns by brands that are not creating cultural connectivity. In fact, Latinos are more likely to turn away from brands that are only interested in selling to them, rather than empowering their cultural relevancy. Hispanics are more inclined to build trustworthy relationships with people and companies that take the time to understand who we are and what we represent morally, ethically and culturally. Read More About This Topic Here
The United States economy is at risk if corporations ignore the impact of Hispanics in America. If not addressed immediately, severe economic and societal recovery woes will prevail. The rest of America must mature from being uncomfortable about a topic that has direct implications to their financial well-being and the future of their children. The US economy demands that we all become more educated about Hispanics as they will soon represent the core of our country. We must stop being in denial.
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