The U.S. Hispanic market has evolved into one of the most significant and dynamic consumer segments for American businesses. With over 63.5 million Hispanics comprising 19.1% of the U.S. population, the demographic is both large and influential. Beyond sheer numbers, the unique cultural values, preferences, and trends within this group offer businesses immense growth potential. ThinkNow's "Hispanic Market Today" report explores how the Hispanic community is reshaping the demographic landscape and creating new opportunities for companies across industries.
Download the report here.
One of the defining characteristics of the Hispanic population is its youth. The median age of Hispanics in the U.S. is 30, considerably younger than the 44.5 median age of the non-Hispanic white population. This makes them one of the youngest ethnic groups in the U.S. and positions them as a critical audience for brands targeting long-term consumer loyalty.
In addition to its youthfulness, the Hispanic population is growing at an extraordinary rate. Approximately one million Hispanics are added to the population annually, driven by both immigration and higher-than-average birth rates. In contrast, the non-Hispanic white population is shrinking by around 500,000 individuals each year. As the white population declines, businesses must pivot toward multicultural audiences like the Hispanic market, which represents nearly one-fifth of the U.S. population and is growing.
The substantial size of the Hispanic population in the U.S. correlates with its growing economic influence. In 2024, Hispanic buying power is expected to reach $2.3 trillion, up from $1.95 trillion in 2020. By 2026, this figure is projected to grow to $2.76 trillion, accounting for 12.1% of total U.S. buying power. Hispanic spending growth is outpacing the U.S. market, with an annual growth rate of 8.6% compared to the national average of 5.5%.
This increasing economic clout presents a wealth of opportunities for businesses looking to tap into a consumer base that is larger than the entire Canadian economy. Hispanic consumers are highly optimistic about their financial future, with nearly half expecting their financial situation to improve in the coming year. This optimism translates into greater consumer confidence, driving demand across various sectors, including housing, education, technology, and entertainment.
To successfully engage Hispanic consumers, businesses must understand the cultural drivers influencing their behavior. Family, community, and education are deeply rooted values that guide decision-making for many Hispanics. For instance, the emphasis on family unity can be seen in larger household sizes—an average of 3.8 people per Hispanic household, compared to the U.S. average of 3.2.
Education is another key value that resonates with Hispanic consumers. Although only 18.8% of Hispanics hold a college degree, pursuing education is highly prioritized. For marketers, messaging around educational opportunities and products that support learning and personal development can resonate deeply with this audience.
A blend of traditional values and contemporary aspirations also influences Hispanic identity. The report highlights that Hispanic Millennials, particularly, embrace themes commonly associated with American pop culture, such as freedom and equality. This generation is more likely to value the ability to pursue their dreams and believe they have control over their futures, reflecting a strong alignment with broader American values while maintaining a distinct cultural identity.
Language plays a central role in shaping the Hispanic identity in the U.S. While 75% of Hispanics report being able to hold conversations in Spanish, 84% are also fluent in English. This bilingualism within the Hispanic market reflects the unique bicultural experience of many Hispanics, who seamlessly navigate between two cultural worlds. Many identify more with their country of origin (e.g., Cuban, Mexican) when interacting with other Hispanics rather than broad terms like Hispanic or Latino.
For marketers, this biculturalism presents both challenges and opportunities. Brands that can authentically communicate in English and Spanish while respecting the cultural nuances of the Hispanic community are more likely to be viewed favorably. Catering to both Spanish-dominant and English-dominant consumers will help businesses capture the diverse segments within this market.
As the U.S. population becomes more multicultural, businesses should be adjusting their strategies to reflect this new reality. ThinkNow’s report reveals that 41% of the U.S. population is now multicultural, and among those under age 20, this figure jumps to 50%. Hispanics make up a significant portion of this younger, diverse population.
This demographic shift is leading to increased investment in multicultural marketing. Two-thirds of companies plan to maintain or increase their multicultural marketing budgets in 2024, with 40% of those increasing their spend citing the economic power of multicultural consumers as a key factor. While the Hispanic market has historically been a priority for marketers, many companies are expanding their focus to include other multicultural segments, such as African Americans and Asian Americans.
The report also notes that 1 in 4 marketers have changed their approach to multicultural marketing in response to shifting demographics, revised advertising campaigns, and updates to diversity, equity, and inclusion (DEI) initiatives. As the Hispanic community grows in size and influence, businesses prioritizing culturally relevant marketing strategies will be better positioned to connect with this important audience.
The Hispanic market in the U.S. is not only large and growing but also increasingly influential in shaping the U.S. economic and cultural landscape. Businesses must invest in the knowledge to understand this demographic in order to tap into the market’s potential. By investing in multicultural insights, marketers can create culturally resonant strategies that help companies build lasting relationships with Hispanic consumers and thrive in an increasingly diverse marketplace.
Download the report here.
In this episode of The New Mainstream podcast, Mario Carrasco and Michael Roca, who currently spearheads the Cross-Cultural Center of Excellence at Omnicom Media Group, delve into the evolving landscape of multicultural marketing and media.
Multicultural has shifted from a niche segment to a central focus for many brands and agencies. This change reflects a growing recognition that diverse audiences are not just a part of the market but key drivers of growth and innovation. Understanding and engaging with these audiences can lead to more effective marketing strategies and expand market share.
Historically, companies housed multicultural marketing expertise in separate units. Over time, these teams were often folded into Total Market efforts. Doing so, however, diluted the specific focus needed to genuinely connect with diverse audiences.
As the U.S. moves towards becoming a multicultural majority, a nuanced understanding of the complex and multifaceted identities of diverse audiences becomes critical. However, many sectors underinvest in multicultural marketing and media despite the clear benefits. Brands must move beyond analysis paralysis and take actionable steps toward inclusivity. By incorporating these perspectives from the beginning, brands can create more authentic and impactful connections.
Tune in to the full episode of The New Mainstream podcast to gain valuable insights into the future of multicultural marketing and media.
The past year has been a roller coaster ride for multicultural marketing practitioners. From the recent Supreme Court ruling on affirmative action to increased scrutiny of diversity, equity and inclusion (DEI) initiatives, companies are carefully assessing how these factors will impact their multicultural marketing budgets. ThinkNow shares this curiosity and has recently surveyed corporate decision-makers in multicultural marketing and multicultural consumer research, aiming to understand how they are strategically navigating the current landscape.
Download the report here.
Multicultural marketing budgets are on the rise. Two-thirds of respondents plan to maintain or increase their multicultural marketing budgets in 2024. The driving force? Opportunity. Recognizing the economic power of diverse consumers and demographic shifts, companies see multicultural marketing as a key growth strategy.
Among the reasons cited by the 31% of respondents who plan to increase their budgets are identifying new business opportunities, acknowledging cultural influence on their business, and a desire to better represent and impact diverse audiences.
Additionally, respondents highlighted the importance of staying ahead of cultural trends and consumer behaviors to remain relevant and effective in their marketing efforts. This includes understanding the nuances of different cultural identities and tailoring messaging and campaigns accordingly. Companies recognize that cultural relevance is not only a matter of inclusivity but also a strategic imperative for engaging and retaining diverse consumer segments.
Interestingly, nearly 40% of respondents intend to maintain their 2023 budgets, indicating a continued commitment to multicultural marketing. This demonstrates a continued recognition of the economic significance of multicultural consumers and the importance of targeting this segment effectively.
However, amidst the optimism surrounding budget increases, there are challenges and instances of caution. Eighteen percent of multicultural marketing decision-makers plan to decrease budgets, citing general cost-cutting measures and clients shifting towards broader "general population" strategies. Among the reasons given by the minority who stated they’re reducing their budgets were:
Moreover, there is a growing emphasis on accountability and measurement in multicultural marketing efforts. Companies are increasingly leveraging data and analytics to evaluate the effectiveness of their campaigns and ensure they are resonating with diverse audiences. This includes monitoring key performance indicators such as brand awareness, consumer engagement, and sales lift among multicultural segments.
Still, 1 in 4 companies are adapting their approach. The cost of “getting it wrong” has increased in recent years. No one wants to be in the position Budweiser was in after boycotts erupted in response to their partnership with a trans influencer. In response, some companies are taking a more cautious approach, while others are conducting more research before launching new campaigns.
Key Takeaways:
What does this mean for the future? While challenges exist, the prevailing sentiment among many practitioners is that multicultural marketing represents a pivotal avenue for growth. Companies adept at strategically maneuvering through these changes and placing a premium on comprehending diverse consumer demographics will undoubtedly find themselves poised for success.
The 2023 holiday shopping season kicked off strong, with Adobe Analytics reporting a record $9.8 billion in Black Friday online sales, up 7.5% from 2022.Cyber Monday numbers were even stronger, with consumers spending $12.4 billion, a 9.6% increase over last year. So, what does this mean for December sales and the rest of the holiday shopping season? ThinkNow recently conducted a nationally representative quantitative survey of 1,500 consumers revealing insights into what Americans buy and spend for the holidays. From shopping habits to spending patterns, let's delve into the top five trends shaping the 2023 holiday shopping season.
Download the report here.
The changing consumer landscape presents challenges and opportunities during the holiday season. Our findings suggest that businesses should focus on the following strategies to engage multicultural consumers during this time to build goodwill that could spill over to other peak spending seasons:
The 2023 holiday shopping season is starting strong, with several key trends emerging. Early birds are taking advantage of extra discounts and promotions, while spending sentiments are mixed due to economic uncertainties. Online shopping continues to dominate the landscape, with over half of consumers planning to purchase online. This presents a unique opportunity for businesses catering to multicultural consumers who are expected to drive significant growth during the holiday season.
Download the full report here for a deep dive into the findings and more cultural insights.
Programmatic media buyers know that multicultural audiences are a rapidly growing and vital market segment. However, advertisers also know that targeting these audiences can be challenging, especially for those lacking cultural competence. Cultural competence is essential for programmatic media buyers aiming to reach multicultural audiences effectively while avoiding costly mistakes.
Cultural competence is the ability to understand, appreciate, and interact with people from cultural backgrounds, values, and beliefs different from one’s own. While necessary for companies and brands aspiring to reach and engage multicultural audiences meaningfully, cultural competence is essential for programmatic media buyers who rely on data-driven strategies to target their ads.
The absence of cultural competence in the multicultural data era can have negative consequences for marketers, so it’s important to remember the following:
Advertisers unaware of these biases could end up targeting ads to the wrong people or using offensive language in ads, risking the company’s brand reputation and alienating the target audience.
Wondering how to employ cultural competence when using programmatic media to reach multicultural audiences? Here are a few valuable tips:
By following these tips, advertisers can use programmatic media to reach and engage multicultural audiences respectfully and effectively.
The beauty industry has transformed in recent years driven by consumer demands for products that align with their cultural values and personal beliefs. While the top cosmetic brands continue to be L’Oreal and Estee Lauder, they are being challenged by younger, edgier brands like Selena Gomez’s Rare Beauty, Rihanna’s Fenty and e.l.f. Cosmetics. Consumer opinion, however, is not homogeneous. There are significant differences in preferences based on ethnicity, age, income and gender. ThinkNow uncovered some of those differences in our recent Inclusive Beauty Report based on a nationally representative online survey of 2,800 respondents.
Download the full results of the survey here.
The era of conscious consumerism has brought about a major shift in the beauty industry. Increasingly, consumers seek products that align with their values, whether minimizing harm to animals, supporting sustainable practices, or promoting inclusivity. This has led to a growing demand for cosmetics and beauty products that are cruelty-free, meaning they are not tested on animals and that are considered inclusive.
Interestingly, while nearly half of cosmetic consumers want cruelty-free brands, 88% of them are still not cruelty-free. However, the fastest growing brands like e.l.f. and Rare Beauty are both cruelty-free and vegan. Legacy companies that want to compete in today’s market are being pushed to adopt these practices in their formulations and testing processes.
While the market as-a-whole is trending towards conscious consumerism, there are significant multicultural differences. For example, the demand for all-vegan cosmetics appears to be driven by non-Hispanic White consumers.
Additionally, since non-Hispanic Whites are, on average, ten years older than multicultural Americans, 42% of them choose brands based on how they address age-related needs vs. 30% of Hispanics who value age-related needs. Asians value products that offer solutions for different skin tones (37%) vs products that are endorsed by celebrities (15%) while Black and non-Hispanic White consumers are more likely to value brands that have a variety of price points. Understanding and addressing these specific preferences, as supported by cultural consumer insights, is crucial for building a loyal customer base.
One might assume that younger consumers would be most interested in conscious consumerism. Gen Z however, is much less likely to seek out vegan cosmetic brands (19%) than Millennials (33%) or Gen X (31%). Gen X is more likely to seek out organic/natural ingredients (41%) than the 36% average for other age groups.
Income, however, is one of the factors that most affect cosmetic product preferences. For example, those earning more than $80K a year are significantly more likely to choose brands that are cruelty-free (53%) and vegan (42%) than those earning less than $40K annually (39%) and 21%), respectively. This insight-driven approach doesn't just enhance product offerings; it also builds trust and loyalty among diverse consumer groups.
The beauty industry's shift towards cruelty-free, vegan, and inclusive beauty products aligns with trends observed in multicultural consumer insights. Younger generations are the most statistically diverse in history and wield the power to affect change. They are communicating their expectations to brands or starting their own and challenging heteronormative stereotypes of “beauty.” Companies willing to adapt to these culture shifts will stay relevant as consumer tastes change and contribute to a more compassionate and diverse world.
As digital marketing continues to evolve, creating personalized marketing experiences for consumers has become critical to successful marketing strategy. In the past, marketers relied on tools like third-party cookies to personalize the customer journey. But with cookies going away in 2024, it’s more important than ever to collect zero-party data to create those personalized marketing experiences while respecting consumer privacy.
Equally as important, however, is the use of multicultural data. The U.S. is becoming increasingly diverse, with much of that growth driven by young consumers. Using multicultural insights helps to personalize their experiences, thus creating stronger bonds that ultimately improve business outcomes.
According to the U.S. Census Bureau, multicultural consumers currently represent approximately 40% of the U.S. population and are projected to account for 55% of population growth over the next five years. Therefore, brands looking to succeed in the U.S. market must understand the needs and preferences of these consumers. It’s important to remember that people change, societies evolve, and cultures shift. Brands that stay attuned to national population trends and behavioral pivots and make efforts to understand the cultural drivers influencing them are in the best position to engage this consumer market successfully.
Personalized marketing experiences are no longer a ‘nice to have’ but a necessity. Consumers today expect to receive messages relevant to their interests and needs, and marketers who fail to deliver such experiences will be left behind. One of the keys to creating personalized marketing experiences is the use of zero-party data. Zero-party data is data that consumers intentionally and proactively share with companies. This type of data is valuable because it provides insights into what consumers want. As third-party tracking tools retire, zero-party data is becoming one of the most sought-after permission-based tools for engaging consumers more effectively.
Zero-party data, however, is just one piece of the puzzle. Another key component of personalized marketing is the use of multicultural data. ThinkNow research shows that multicultural consumers have unique needs and preferences, and understanding these nuances is crucial for creating effective marketing campaigns. For example, diverse cultures may have different values, beliefs, and traditions that can influence their purchasing decisions. By understanding these differences, marketers can tailor their messaging to resonate more strongly with multicultural audiences.
Multicultural data can also help brands avoid cultural missteps that could damage their reputation. ThinkNow research has shown that multicultural consumers are more likely to engage with brands that prioritize diversity and inclusion in their marketing efforts and are willing to stop frequenting a store that does not. From campaign strategy to execution, multicultural data can help brands build a deeper connection with multicultural consumers by helping them market in-culture, avoiding common mistakes that could prove very costly.
To effectively use multicultural data, it's important to ensure that it is collected and analyzed ethically and responsibly. Brands must take care to avoid stereotypes and assumptions when analyzing multicultural data and should work to understand the nuances and complexities of diverse cultures. Additionally, brands should be transparent about their data collection practices and ensure that consumers know how their data is being used.
Using zero-party and multicultural data to personalize marketing experiences has become a business imperative. Multicultural consumers are a diverse and rapidly growing segment of the population, and brands that don't consider their needs and preferences risk alienating a significant portion of their potential customer base. Cookies are on their way out, so the demand for zero-party data will only increase.
By using these types of data in an ethical and responsible manner, brands can create more authentic and meaningful connections with their audiences and drive business success.