A few days ago, I was invited to speak to business students in my marketing class about the current state of opportunity in the Hispanic segment. During the Q&A session, a question was asked about how brands should approach Hispanic marketing in a polarized election year.
Student questions marketing and business leaders will be asking themselves this year given the challenges facing programs related to environmental, social, and governance (ESG) and diversity, equity, and inclusion (DE&I). I think it may reflect similar concerns.
This is what I answered. Firstly, while I greatly respect his ESG and DE&I work, we need to distinguish between these and multicultural marketing (he wrote about this topic in Forbes a while back. Go to that article link here).
For decades, companies have used segmentation to drive revenue and profits by identifying cohorts of consumers with commonalities (age, gender, geography, income, education, life stage, common hobbies, etc.) I've been doing it. With the growth of diverse ethnic segments, primarily the Hispanic consumer segment, it is no surprise that brands are showing greater interest and increasing investment in this segment. Selecting Hispanic consumers as a growth priority segment is one segmentation approach that marketers can use to maximize profits.
The Hispanic consumer segment has changed over the decades, but even though the majority of U.S. Hispanics are now U.S.-born, most of its members still have a significant level of affinity for Latin American culture. is maintained. As several studies have shown in the past decade, the idea that most Hispanics will naturally assimilate and behave like “the rest of the world” (also known as the failed total market) concept) does not occur in reality.
This can be illustrated by a compelling study commissioned a few months ago by the We Are All Human Foundation in partnership with Nielsen. One of the questions asked in the study was how well brands reflect the values of Hispanic consumers. Surprisingly, only 45% of respondents said their brands reflected these values, a decrease of 9 percentage points compared to the previous version of the same survey conducted in 2018. did.
These results are even more concerning when looking at the responses from Gen Z Hispanic respondents. Just 41% believe that brands reflect Hispanic values, down from 59% in 2018 and a 19-point drop in just five years.
It may also reflect a disconnect between what Hispanic consumers expect from brands when they perceive them as part of broader society and as individuals with a rich and proud culture. there is. A common mistake in some marketing plans is that just because most Hispanic consumers were born in this country, speak English well, and are connected to British culture, they do not necessarily make connections to Hispanic heritage. It is to assume that you have given up on it.
I interviewed Claudia Romo Edelman, founder and CEO of the We Are All Human Foundation, and asked her about the study's conclusions.
“The 2023 Hispanic Sentiment Survey shows a significant increase in unity and pride among Latinos, five years after we conducted our first field survey in the community. of Latinos embrace our Latinidad. We are committed to our values, traditions, optimism, resilience, love of family, and language. And to our diversity. Yet, we have come to think of ourselves as a united community: we share our culture, we tell our stories, we understand economic and political power, we I'm learning how to take advantage of it.
With so many positive opinions, the disconnect with major brands is surprising. Latinos want diversity. We are paying more attention to Spanish media. We all want to see ourselves authentically expressed, but I don't think we're there yet. But the most important brand insight is that brands that engage directly with their communities and support the advancement of Hispanics in ways that are community-relevant and true to brand will often earn lifelong loyalty. I think. Grassroots marketing is extremely important and represents a huge opportunity for brands. ”
Leveraging Hispanic heritage and culture is a great way for brands and advertisers to reach out to the Hispanic consumer base and further enhance the appeal of a brand's message through a nuanced look at existing plans known in the industry as “winks.” It provides an important opportunity to provide elements that can be used. Increases awareness, consideration, and purchase likelihood. Furthermore, culture can also influence the way consumers buy products and services, and brands can tap into cultural and traditional backgrounds that would otherwise be difficult to capture. Can bring out waxy growth.
For brands, marketing plans and businesses that recognize the gaps observed above and combine the idea of including Hispanics and other minorities in their plans, rather than simply treating them as part of a monolithic group. It is more important than ever to commit to developing a plan. A one-size-fits-all approach. Brands that ignore the need for a specific Hispanic marketing plan are at risk of disengaging a demographic that accounts for 51% of the country's population growth over the years, according to the latest census results.
And that risk brings us back to the question we asked at the beginning of this article. The idea of investing in Hispanic marketing goes beyond politics. It's first and foremost a business decision.
Both major political parties understand this, which is why politicians on both sides of the aisle are actively engaging in specific linguistic and cultural marketing efforts to connect with Hispanic voters. Brands and companies that ignore this fact may risk limiting their growth prospects now and in the years to come.
