While the American economy floundered and consumers as a whole tightened their belts, the growth in Hispanic spending was twice the growth in general market spending, according to a December 2009 analysis of consumer expenditures and corporate growth strategies by the Latinum Network.
The Latinum analysis shows that non-Hispanic consumer spending from 2005 to 2008 grew only 2.9 percent, while Hispanic consumer spending increased 6.4 percent in that same period. The Latinum report is the first in-depth analysis of the latest figures from the U.S. Bureau of Labor Statistics on spending behavior as it relates to the Hispanic community.
The Latinum report reveals that significant commercial opportunities exist in major categories where Hispanic consumer spending growth far outpaced the general market. The major categories included food away from home and a range of others. For example, from 2007 to 2008, U.S. Hispanic consumers were responsible for 30 percent of the $40 billion growth in the food business.
"In this economic environment, categories such as these provide opportunities for brands to grow 'organically' by maintaining or increasing their share of an expanding pie," said Latinum principal Michael Klein. "At the same time, we're seeing companies invest in the development of categories where Hispanic spend has been relatively low but is poised to take off."
Latinum's analysis also shows that the highest spending power among U.S. Hispanics is concentrated among those who are increasingly upwardly mobile, yet still influenced heavily by traditional cultural norms.
"As companies look to accelerate growth in 2010, brands that ignore, or misread, the impact of cultural factors on purchasing behaviors may leave the lion's share of U.S. Hispanic buying power on the table," said Latinum principal David Wellisch. "This segment within the Hispanic market represents an attractive growth opportunity for many companies which have traditionally targeted their incremental investments on the unacculturated consumer. They're growing in number, they have the most money to spend, they behave more like general market customers in terms of what products they buy and how much they spend, yet they still respond well to culturally-relevant messages."
Latinum Network is a business network devoted exclusively to helping corporations penetrate the U.S. Hispanic market. It is dedicated to providing its more than 20 member brands such as Clorox, Kraft Foods, McDonald's, Nestle, Sara Lee Corp., 7-Eleven, Splenda and Subway with market insights that enables them to evaluate their opportunities, and accelerate their performance in the market.