Hispanic American Households will Outspend White Households in Their Lifetimes, Making $2.5 Million
Marketing company Claritas, has released the third report in its New American Mainstream series, The Hispanic American Market Report. The report offers marketers unique insights into how to appeal to Hispanic American consumers, one of the nation’s fastest-growing multicultural subsets.
Now the second-largest demographic group in the United States, Hispanic Americans represent 19.5 percent of the U.S. population. With more than 64 million members, Hispanic Americans are also the country’s second fastest-growing population segment, with 83 percent growth since 2000.
Currently there are more than 133.2 million multicultural Americans, and Hispanics account for 37.5 percent of the total multicultural population.
“Only a few decades ago, the Hispanic population was an emerging niche made up primarily of migrant workers in agriculture, factories and in lower-level service occupations. Today, they make up one-fifth of the American population, and Hispanic households are expected to outspend their white majority counterparts during their lifetimes,” said Karthik Iyer, COO at Claritas. “That kind of growth, combined with strong lifetime purchasing power, makes Hispanic Americans one of the most attractive targets for marketers today.”
According to the Claritas Hispanic American Market Report, the cumulative lifetime spend of the average Hispanic American household is $2,535,959. That’s $538,636 more than the lifetime spend of the average white American household. With larger families and increasing spending habits, these consumers represent untapped revenue potential for a multitude of products and services from food, automotive, apparel to insurance, technology and banking.
How are they spending their money? Claritas answers that question in The Hispanic American Market Report, which provides specific details on the buying, cultural and media usage preferences of America’s Hispanic population. For example, according to the report:
Hispanics spend roughly $2,300 annually on apparel – 5 percent more than the average U.S. household. But they spend even more in specific apparel subcategories. They spend 28 percent more than average U.S. households on apparel for children under age 2; 28 percent more on footwear for men, boys, women and girls; and 25 percent more on men’s active sportswear.
Hispanic households also spend $4,740 annually on food at home – about 1.4 percent more than the average U.S. household. They’re particularly large spenders on meat and eggs (spending 15 percent more than the average U.S. household) and on fruits and vegetables (spending 9 percent more).
They also spend 17 percent more than other U.S. households on soaps, detergents and other laundry and cleaning products, making them a potentially attractive target for consumer packaged goods (CPG) companies.
Hispanic Americans also appear to be do-it-yourselfers, particularly when it comes to their automobiles. Compared to the average U.S. household, Hispanic households spend 18 percent on motor oil and 9 percent more on coolant, additives, brake and transmission fluids.
But they spend 15 percent less on vehicle services (lube, oil change) and 13 percent less on tune-ups. This indicates that Hispanics are purchasing these products directly and servicing their own vehicles, rather than paying a garage or dealer to perform maintenance on their vehicles. This makes Hispanics an excellent target group for automotive aftermarket retailers and vehicle parts and fluid manufacturers.
When it comes to social media, Hispanics show a preference for Instagram and Snapchat – and they spend the least time on LinkedIn. This is in sharp contrast to Asian Americans, who prefer LinkedIn over other social media channels, according to The Asian American Market Report, which Claritas released last February. Specifically, Hispanics are more than two times LESS likely than the average Asian household to have used LinkedIn in the past 30 days.