BigResearch: Reaching Niche Markets Within the Growing U.S. Hispanic Population

This post was written by Edilia Ruiz, who is a student at the University of Washington from the Department of Communications and Spanish, and is interning with us during Spring Quarter.

Thinking of targeting your business to the Hispanic population? Consumer research firm BigResearch in Columbus, Ohio has discovered that tastes of Hispanics vary in regards to shopping and media preferences between U.S. born and English speakers versus their counterparts who are foreign born and speak Spanish.

English-dominant speakers and U.S. born Hispanics tend to prefer stores like Macy’s, Walmart and Kohl’s for clothing and Best Buy, Target, and Walmart for electronics.On the other hand, Spanish–dominant consumers and foreign-born Hispanics choose stores such as Macy’s, JCPenney and Walmart for women’s clothing and Best Buy and Amazon.com for electronics.

Also, BigResearch found that English-dominant and U.S. born Hispanics include top 40 in their music interests, whereas Spanish speakers include Latin artists.

Media and technology topics showed that English-dominant Hispanics are more likely to text on their cell phones and use TiVo/DVR, while Spanish-dominant Hispanics are more likely to blog and use instant messaging.

In my opinion, having this type of research helps businesses know how to target a specific audience and advertise most effectively. As a bilingual consumer, I identify with both group findings in this research because as a Spanish speaker and foreign-born consumer I choose stores like Macys, JC Penney and Walmart to shop; at the same time, as an English speaker I also listen to top 40 and I use my cell phone to text as well as blog and instant message with friends and family.

Some questions I had while reading this article include concerns about who their sample included. Did the research include participants in Columbus only? In big cities? Rural areas? Nationwide? Beyond? and what was their methodology? Was the survey conducted through focus groups, telephone interviews, intercepts or was it online? Further, the results do not reflect a big difference between the two groups and their choices of music selections or stores for shopping. Perhaps this tells us that the two groups of Latinos are more alike than different in these areas.

If you are interested in learning more about this research check out the BigResearch website.

Cinco Años

Wow. I just looked at my calendar and guess what--It's been 5 years since I opened shop.

That's right: Five years ago I purchased my domain and applied for a business license and developed the Conexión Marketing brand and, little by little, I had a business. My early menu of services included marketing communications (collateral and merchandising), public relations and overarching strategies--services based on several in-house positions I'd held over the previous 16 years.

Friends, family and colleagues all asked, "Why are you doing Hispanic marketing in Seattle? Why not Yakima, or L.A.?" Seattle is my home, it's where I want to be--and though the Hispanic market was the fastest-growing cultural minority in our region, no Hispanic marketing firms called Seattle home.

My first clients were such a celebration, and they were such an important daily reminder of the talents and skills and experience that I offer in the area of Hispanic marketing.

Since those first clients, I've been on an amazing journey with this business. We began to partner with a handful of global agencies (and their national accounts) and are still happily helping many of them with Hispanic efforts today. We've even worked with a few local ad agencies on work within Washington State and the Pacific Northwest.

We've worked in advertising as well, with one caveat to our clients: They must be able to provide a positive customer experience for the Latino consumer before advertising commences. We believe in "marketing inside out," meaning, make sure you can truly service this segment before you target it with advertising.

We then made the big move to our downtown office at Third & Union, an important move for so many reasons. Most importantly, we're accessible to many of our clients while enjoying the hustle and bustle of downtown Seattle. (Feel free to schedule a visit!)

But helping local companies understand their need to reach this fast-growing segment in the right way continued to be a barrier, so we produced our own research. Hispanic Consumers in the Puget Sound Region was a first-of-its-kind study that helped local companies visualize the important of the local Latino community. It included much more than demographics; it included primary data on such topics as media consumption, language preference, top-of-mind brands in several categories, and more. This study is still available as a free download at our website. (Note that while most of the information is likely still very pertinent nearly three years later, our local media environment has seen many changes since we published the study.)

This study was an important benchmark for Conexión Marketing and the industry; it put the local Latino community on the map in the minds of marketers doing business in our region.

Since then, we've conducted much more research, mostly through partnerships with local research firms. Learning about Seattle-area Latinos is so essential in order to effectively understand their needs. Ours is truly a different market--unlike any of your "typical" Hispanic markets, and even wildly different from that of Eastern Washington markets.

We branched out with the verticals we've served over the past five years, helping companies in a variety of industries--banking, communications (telecom, broadband, cable), healthcare, insurance, civic efforts, media, retail, and consumer packaged goods.

Another way that our firm has branched out has been to incorporate social media into plans when it makes sense. We've done this for several clients now, and while it's difficult to measure ROI on social media, we have seen that it really does nurture a sense of "community" and that consumers enjoy being able to interact with brands. And we're certain that Latinos here are embracing social media because we see them regularly posting on several sites--including at least two local social media sites developed specifically for Latinos!

So while some companies may be holding back on their marketing budgets until the recession's in the rear-view mirror, other companies are stepping up with effective strategy and messaging and becoming #1 in their category locally, even nationally. That's the power of the fastest-growing cultural segment, nationally and locally.

What will 2010 hold? Hopefully, more of the same! Especially since we're expecting this coming year's Census figures to blow away U.S. marketers. Those of you already on board with Hispanic marketing, kudos! You're getting in while competition's light and media is affordable--so your brand is benefitting in a cost-effective way. Who knows what will happen after Census data is released?

I love my business, and I work with so many wonderful and talented people--our clients, our vendors and partners. A big GRACIAS to our many loyal clients, several whom we've served 4+ years!

And here's to a 2010 full of joy and prosperity for us all.

Reaching Unbanked Latinos

In celebration of Plaza Bank President & CEO Carlos Guangorena's birthday today, I'd like to write a little about banking and Latinos. In general, immigrants to the U.S. are much less likely to be banked than American-born. In addition, certain minorities are especially unlikely to have a relationship with a banking institition.

The problem with not having that banking relationship is that then it's difficult to establish credit. And we know that, without credit, many things--like home ownership--are simply unattainable. Now sometimes we hear that employers even check credit reports of their candidates to ensure that they're "responsible." Well, not having any credit at all doesn't make a person "irresponsible," it just means they're living outside the societal norm in the United States. And if they come from a place where banks closed and they lost all their savings, you can understand their hesitation. But now, you see, they have limited opportunities.

According to a first-ever federal survey on the topic, minority groups showed to be much less likely than the overall population to have standard banking relationships. In fact, an article in yesterday's L.A. Times reports on the survey: "Nearly 22% of black households were unbanked, as well as 19.3% of Latino households and 15.6% of Native American households. Just 3.5% of Asians and 3.3% of whites did not use banking services." That's an astounding gap.

Excerpt from the article:

"Many Latinos are most comfortable operating in cash," said James Gutierrez,
chief executive of Progreso Financiero in Mountain View, Calif., which focuses
on giving small, short-term loans to Latinos. Instead of having a paycheck put
on hold for several days at a bank, many turn to expensive payday loans for
immediate liquidity. "There's a lot of distrust of banks," Gutierrez said. "But
even though it's convenient for them to operate outside the financial
mainstream, they can't build a credit history, get a small-business loan, build
wealth. You need to give people a staircase upwards."

Here in the Puget Sound region, Plaza Bank was formed, about four years ago, on this very principle. The founders and directors wanted to create an institution that would be accessible, and since many of them were Latino, they created the Pacific Northwest's first Latino bank--with bilingual/bicultural staff, services and materials. They of course welcome everyone to bank there, with business lending and administrative office is right here in downtown Seattle, and a gorgeous retail branch at the Kent Station Shopping Center in Kent. The Bank has been offering not only your typical bank products for consumers and businesses, but also opportunities for financial literacy. This is what sets Plaza Bank apart from the bigger banks. It's a community bank that is truly reaching out.

For the same reason, the organization Bank On Seattle was created a couple of years back. The mission of Bank on Seattle was to make banking accessible to the unbanked--and keep this population from losing all its money through payday loan services. They formed a cooperative of many credit unions and banks, including Plaza Bank. If anyone can provide information describing the organization's current efforts or achievements, that would be great to learn.

As a side note, in our own survey of Puget Sound Latinos two years ago, we learned that 56% of local Latinos are banked (meaning they have a savings account, checking account or both), which makes the Seattle area market very different from the national average.

Sources: Hispanic Consumers in the Puget Sound Region study available FREE at www.conexion-marketing.com; http://www.linkedin.com/redirect?url=http%3A%2F%2Fwww%2Eeveryoneiswelcome%2Eorg%2F&urlhash=JqF9 ; http://www.linkedin.com/redirect?url=http%3A%2F%2Fwww%2Elatimes%2Ecom%2Fbusiness%2Fla-fi-fdic-unbanked3-2009dec03%2C0%2C487549%2Estory&urlhash=Al9R

Do Hispanics rate products higher because they're Hispanic?

This is a question that multicultural researchers deal with in our work: Are our research participants responding frankly, or are they being polite? Because based on their culture, they may just be responding in a way they think is "appropriate."

Hispanics in particular tend to not want to show disrespect to authority (which can include the focus group moderator). This means that, when you are seeking true reactions to your marketing communications, your product, your new policy--you might have to take this cultural nuance into account in your summary.

Something I do when I'm moderating Hispanic groups that has been very helpful in encouraging their truthful opinions is that I use humor and humility at the outset, before we even get started. I also make it abundantly clear that I am in no way attached to the product or communications we're discussing. This seems to break the ice in a way that encourages more honest responses throughout the session.

This topic was brought to mind thanks to this month's newsletter from Quirk's Marketing Research Review. I've pasted in the piece below, for your consideration:

A trend has emerged in multicultural research showing that Hispanics rate certain products higher than non-Hispanics simply because they are Hispanic. The phenomenon is known as cultural lift, and it can be taken into account to improve the accuracy of results when conducting preference testing.

According to Savitz Research Companies, Dallas, Hispanics gave 5.9 percent higher average ratings than non-Hispanics in the U.S. on a zero-to-100-point scale, even though high product ratings often didn't translate to a rise in sales and usage. It has been thought that cultural influences may make Hispanics more reluctant to provide negative or impolite feedback.

When evaluating soft drinks, for example, Hispanics rated Pepsi 80.8, while non-Hispanics rated it 74.8, making it appear that Hispanics like Pepsi more and would be a better target. Ratings for 7-Up were essentially the same, at 73 for Hispanics and 73.7 for non-Hispanics. When asked to rate Fanta, a drink which Hispanics are known to prefer, Hispanics gave a rating of 80, compared to a 57.6 rating by non-Hispanics. After the 5.9-point adjustment of the Hispanic ratings to remove the cultural bias, Hispanics and the general population actually feel about the same about Pepsi, non-Hispanics prefer 7-Up and Hispanics still definitely like Fanta more than non-Hispanics.

What do you think? What have your experiences been, and how have you handled differences in communication? Please feel free to share here.

LATINO DECISIONS

Do you know about this ongoing political-based research? It's conducted regularly by Pacific Market Research (our go-to for quantitative bilingual data collection).

Here's the latest results from a poll regarding the first 100 days of the Obama administration:

Action on immigration this year is identified as “extremely important” by 51% of Latino registered voters polled on the occasion of the President’s 100th day in office. This compares with only 40% just last November, when Latino voters supported the president by more than 2-1 against his Republican rival. Another 23% now describe it as “very” important. At that time, Hispanic registered voters appeared willing to give the new administration some time to deliver on the promised changes but, perhaps sensing an unusual opportunity and the president’s own recent statements on the matter, Latino voters appear to see action on immigration as increasingly urgent.

When presented with a comprehensive reform plan that included both tougher border enforcement as well as an adjustment of status for undocumented workers already here accompanied by penalties and a waiting period, a full 75% supported this approach, with 49% strongly supporting it.

They also mention that economy is the most important issue (even over immigration) and also the fact that approximately 81% of Latino registered voters approve of the job the President is doing, and 57% of that is strong approval. By contrast, disapproval at any level totals only 16%.

• To reference this type of information, check in with Latino Decisions for the latest results.
• For a great value in quantitative data collection with full bilingual capabilities, visit Pacific Market Research or call (425) 271-2300 and ask for Andrew or Mark!

Hispanic Focus Groups

Since we're busy with focus groups these days, it occurred to me that it might be helpful to share some tips for successful Hispanic focus groups. Please note that these tips are based on seeking more recent immigrants versus American-born or acculturated Latinos. There are definitely some differences in how you manage this group.

For example, when you're recruiting for the group, the screener should identify the qualified participant as Spanish-dominant. Many Latinos are bilingual, but immigrant Latinos will likely say they're more comfortable conversing in their native Spanish. These are likely your target (versus the more acculturated Latino who may be better integrated with the general market group or at the least involved in separate research).

We recommend that Hispanic focus groups are kept small--6-8 participants is usually ideal. Why? The Latino participants are generally more likely than the general market participants to "follow the leader" and allow one participant to dominate and influence the rest of the group. By keeping the group small, there's more opportunity for each to speak his/her mind.

Once your participants pass the screener and confirm attendance, you'll be wise to mention that they should make arrangements for their kids (as appropriate). So many times, I've moderated groups in which the participants show up with kids in tow. It's a shame, because they're perfectly qualified for the research, and yet now they're turned away because there are no accommodations for their kids. Better just say it up front.

This goes for guests, too. Oftentimes their spouse or friend who may have driven shows up and expects to stay. This is not recommended, and it's wise to make it clear as you confirm their appointment.

Sometimes it's been helpful to offer an additional cash bonus to the first to arrive, or to those who arrive before the actual start time, when possible. It's a definite incentive and compensates for any cultural differences in terms of how time is viewed!

Keep writing exercises to a minimum if possible. We just learned this one recently. Writing assignments can be difficult for people who are not accustomed to writing and impossible for those who may not have learned to read. The immigrant population can include both groups, so it's best to keep the conversation going. We found in our last experience that it works to provide participants with sheets to rank their favorites (to avoid the influence of others), but to limit it to check marks and numbers versus explanations, for efficiency's sake.
>>Please note that in no way am I making the assumption that foreign-born Latinos can't read/write! But when you're planning your research, it's helpful to understand that education isn't always accessible for those from other countries; they may have had to work at an early age, or help their parents, etc. Just a different culture than what most of us in the U.S. are familiar with.

Let me know if you have other suggestions for our readers (or for us!). We're always learning!

Busy Bees, Off to Sacramento

Hola - we've been uber-busy around here the last few days, hence my lack of posts. We love our clients, but why is it that their requests seem to converge?!

Hope your work is keeping you busy and challenged, too!

I am still excited because at the American Marketing Association luncheon this past Wednesday my guest and I each won $50 gas cards--how cool is THAT? And gas prices are decreasing, so they're worth even MORE. ;-)

Speaking of fuel--we've got multiple travel dates coming up next week and into December: Hispanic focus group work in Yakima, Tri-Cities, possibly Spokane and--what do you know--even Seattle (travel there only involves the Metro).

But today I'm thinking about my trip to Sacramento, which will commence in just hours and last through Monday. Visiting my little sis and her family (younger son is turning 5!) and looking forward to that time with them. I've turned the boys on to V-Me, the Spanish-language public programming that is a great resource for parents who don't want their kids watching (sometimes unexpected trash), and they're hooked. Great programming for kids and adults, available in our market as well.

That's all I've got today. Enjoy the weekend!

The People Speak

The University of Washington worked with State Farm Insurance and tú Decides Newspaper to conduct a Hispanic market study at a recent event.

Here are some highlights:

• When local Latinos were asked about the most important issues when it comes to choosing a president, they listed economy and jobs at the top.
• As issues with greatest importance, the nation's economy, the state's economy and education led.
• When asked about whether the situation for Hispanics in Washington State was better, worse, or about the same, males and females responded significantly differently. The majority of women found it about the same (56.5%) or worse (30.4%), whereas men responded that it was about the same (38.3%) or better (30%). In general, we could say that Hispanics feel their situation here is about the same. Note that there was no significant difference in how U.S. born versus foreign-born Hispanics responded.
• Men were found to be generally much more confident about their financial situation than women, but in general Hispanics are only somewhat confident.

For more details on the study, visit the newspaper's bilingual site and look up the October 31, 2008 edition:
http://www.tudecidesmedia.com/