This week, many communities celebrate Cinco de Mayo. At the same time, a Congressional immigration reform bill is bringing renewed attention to the issue of immigrants. No matter how you feel about the issue politically, as an entrepreneur, there’s one thing you can’t ignore: Hispanics in the US represent a huge marketing opportunity.
Serving Hispanics can be a great business move. One businessman I know had a struggling used car dealership. Then, 20 years ago, he took a chance. He started selling cars to Hispanics, including migrant farm workers, when no one else would do so. He learned Spanish, hired Spanish-speaking salespeople, and extended credit to customers when others wouldn’t. Today, he’s a millionaire.
This car dealer learned what many entrepreneurs have realized:
Hispanics in the US have a lot of money to spend.
Over 40 million people in the US are Hispanic, according to 2004 Census Bureau data. That represents 14% of all Americans. Over 25 million of these are of Mexican origin; the rest are primarily from Puerto Rico, Central and South America, and Cuba.
Those numbers are going to increase. By the year 2050, about one in every four Americans will be Hispanic, according to figures cited in Advertising Age.
Large businesses certainly recognize the importance of the Hispanic market. In 2004, nearly $3 billion was spent on advertising by big companies to reach Hispanics, according to HispanTelligence, the research arm of the magazine “Hispanic Business.”
Top brands advertising in Spanish language media include McDonald’s and Burger King, Home Depot, cell phone companies, Sears and Wal-Mart. And to work off those burgers: Bally Total Fitness. Hispanics buy a lot of food, goods, and services. Big companies want to reach them; why not you?
Generally, Hispanic consumers are young: the median age of Hispanics of Mexican descent in the US is 25.3 years. That compares to a median age of 36.2 years for the population as a whole. These younger Hispanic consumers have families and homes, thus they need groceries, clothing, hardware. They also consume a lot of entertainment and gadgets.
If your company’s customers are businesses, rather than consumers, you can’t afford to overlook Hispanics either. After all, Hispanic-owned businesses increased at three times the national average of all businesses between 1997 and 2002, according to the US Census Bureau.
Hispanic-owned businesses represent a huge business opportunity. In 2002, the nearly 1.6 million Hispanic-owned businesses generated over $222 billion in gross revenues. That’s a lot of money to be spent on business services, supplies, and equipment. Is it possible for you to be the one they buy from?
First, it helps to know what types of businesses Hispanics own. In 2004, according to the Census Bureau, here are the numbers of the leading types of Hispanic-owned companies:
* Other services 249,277
* Construction 212,496
* Waste management 208,125
* Health care and social assistance 181,677
* Retail Trade 151,501
* Professional and Scientific Services 138,345
* Transportation and Warehousing 125,750
Hispanics are a large market, but realistically, it’s a challenge for a small company to figure out how to serve that market.
Do you have to learn Spanish? Not necessarily. A majority of Hispanics – 52% -- identify themselves as bilingual and 29% say English is their primary language.
However, if you decide to make a concerted effort to reach Hispanics, it may help to learn some Spanish or hire Spanish-speaking employees.
The best way to get a piece of the Hispanic market is to go about it the same way you’d approach any other target market. Sit down and devise a marketing plan.
First, look for networking groups. Yes, you can join your local Hispanic Chamber of Commerce even if you’re not Hispanic. Sure, you may be uncomfortable the first meeting or two, but that’s true when you join any new group. Hispanic businesses need your accounting, legal, or graphic design services as much as non-Hispanic companies.
Advertise in local media reaching the Hispanic market. If you don’t speak Spanish, advertise in English. Many English-speaking Hispanics read Spanish language publications.
If you want a piece of the huge Hispanic market, you’ve got to make yourself visible to that community. Developing a plan to reach Hispanics might just be the perfect way to celebrate Cinco de Mayo.
