COVID-19 taught us the importance of proper planning, market research and, most importantly, having a deeper understanding of the consumers we serve.
Franchise Your Business
Schedule a FREE one-on-one session with one of our Franchise Advisors today and we’ll help you start building your franchise organization.
5 min read
Opinions expressed by Entrepreneur contributors are their own.
America is going through a transitional period in the midst of a demographic revolution. Our future is no longer as predictable as we once imagined, especially considering what we went through in 2020 and the current changes we face as we begin 2021. A new government administration is ready to settle in. The emergence of a Covid-19 vaccine is intended to give hope to millions of Americans during the pandemic. Plus, the demographic transformations in our society are now heavily influencing our economy. The U.S Hispanic community has become a key contributor to our economic growth, labor force, and electorate impact, more so than any other population segment. As we move forward, their influence will continue to strengthen.
Covid-19 taught us the importance of proper planning, market research, and, most importantly, having a deeper understanding of the consumers we serve. This goes beyond generating a sale today. True success now relies heavily on building better relationships with your consumers. The key to this is creating a better brand experience — from introduction to purchase and beyond. You must learn how to engage and motivate consumers to the point where they are genuinely excited about your products and services. Then they will become your brand ambassadors. That level of loyalty will bring you repetitive purchases and continued word-of-mouth referrals.
Technology has created a demand for cultural connectivity. Throughout life, we tend to make life and business decisions based on past experiences and the feelings they evoke. In many cases, we are driven by personal bias and opinions that are not in tune with market data or aligned with our customers’ wants, needs, and desires. From a business stand-point, we oftentimes are obsessed with making a sale today without regard for tomorrow.
Even after all corporate America went through in 2020, I still encounter executives who are so skeptical about making adjustments to their strategies for 2021. Not only have they reduced their marketing budgets, they remain reluctant to engage with a new audience that could transform their business, as they have our mainstream society: U.S. Hispanic consumers.
The question is: How are you planning to financially recuperate post-pandemic if you are cutting your advertising budget and neglecting an audience that is now driving sales and market growth? How can you justify that the same approach you have been executing for years will develop enough sales through this demographic transformation?
If you had a profitable year during the pandemic, how will you keep the momentum going? How will you assure sustainable growth if you neglect the fact that the mainstream is becoming multicultural? The same tactics and messages you have been using will not resonate culturally with your new audiences.
Here are some important facts that will help get you on track for a stronger 2021 and beyond:
- Minority is becoming the majority: The results of the 2020 census will prove it. According to the report from Nielsen, “Cultural connectivity transformed. How Latinos are connecting while social distancing”, there are over 62.3 million Hispanics living in the USA, representing 19% of the U.S. population. Their median age is 28, so they are swiftly approaching their peak earning years. From 2010 to 2019, Hispanics’ buying power increased 69% compared with 41% of non-Hispanics. Over the past 6 years in the USA, Hispanics accounted for 75% of all U.S. labor force growth. Their purchasing power is expected to reach $1.9 trillion by 2023, which is higher than the GDP of countries such as Australia, Spain, and Mexico.
- U.S. Born and foreign-born Hispanics are not exactly the same: Just as British and American people are not the same, even though both nationalities share one language. It doesn’t mean that their cultures and reactions are alike. The same happens within the Hispanic community. Even though we share one language, Spanish, there are still certain preferences in the way different generations consume media and interact with brands. This is so important to address during your strategy development and marketing approach. It is also important to highlight that Hispanics are largely bilingual and bicultural, with 75% speaking Spanish at Home. The fact they were born in the USA doesn’t mean they think and act like Americans from a cultural or purchasing standpoint.
- Higher payoffs come from more loyal consumers: The Hispanic community has a high ROI. It takes time to earn their loyalty and trust, but they will help you secure greater sales. How much? That depends on how committed and consistent you are in your marketing approach. Let’s put it this way, would you develop a strong and reliable friendship with someone who only contacts you once every 6 months or so, but only to ask you for a favor?
Hispanics are highly passionate and social. They share what they love and don’t love with their friends, family, and community. The actual purchase is just one step in the process. They will share their satisfaction or dissatisfaction with their circle of influence, providing the fuel for others to engage or not engage with specific brands. It is estimated that Hispanics are 40% more likely to live in multigenerational households. Imagine how many people your brand could influence by simply making one person happy within that household.
2021 will be a year of reflection and growth. According to Nielsen, Hispanics will contribute more growth than any other population segment. It is estimated that for the next 40 years, Hispanics will be the primary contributors to the total U.S. population growth, comprising 53% of growth in just the next five years and 68% of the growth for 2060. Start adjusting your strategy today to assure a profitable and sustainable future, whatever it may look like.
Entrepreneur: Latest Articles