April 29, 2016
Target sings a Latin musical marketing tune
There’s nothing new about Target’s sponsorship of the 2016 Billboard Latin Music Awards show. The big news is that beyond last night’s broadcast, Target has significantly increased its marketing budget intended to attract and retain Hispanic customers.
Target has boosted its Hispanic marketing budget by 20 percent this year, according to Advertising Age. Last night, the retailer ran four commercials during the Billboard awards show as part of its Lúcete A Tu Manera” (“Show off your way”) campaign.
The value of the Hispanic consumer market continues to grow. According to an analysis of U.S. Census Bureau data by Pew Research Center, about a third (17.9 million) of the Hispanic population in the U.S. is younger than 18 and roughly one-quarter (14.6 million) is between the ages of 18 and 34 (Millennials).
The vast majority of these young Hispanics are born in the U.S., including 94 percent of those under 18. Sixty-five percent of Hispanic Millennials were born in America.
While the Spanish language has been seen as the best way for marketers to communicate with Hispanics, that is changing. Today, more than a quarter of Hispanic Millennials only speak English in the home and 76 percent speak the language well. Among those under 18, 88 percent are proficient in English, with 37 percent living in households where only English is spoken.
Rick Gomez, senior VP-marketing at Target, told Ad Age that his company’s customers are “increasingly millennial and increasingly multicultural.” Those customers (guests, in Target parlance) are “also increasingly Hispanic.”
Discussion Questions
DISCUSSION QUESTIONS:
How have changing demographics within Hispanic communities affected consumer marketing in recent years? How will these changes affect how marketers such as Target speak to these consumers in the years ahead?
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BrainTrust
Carlos Arámbula
Principal, Growth Genie Partners
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One thing I notice when working with Hispanic supermarket retailers is that their websites are primarily in English now. The newest generation speaks English. In the 1990s and early 2000s, the children were the family translators. Now they are adults. I recall working in rural Louisiana in the 1980s and hearing Cajun French spoken. Now only the elderly speak the language. The languages die off but the culture lives on. Marketers speak to minority groups by understanding their culture. Outsiders trying to use “Spanglish” will come across as demeaning and insincere.
Three quarters of Hispanic Millennials are perfectly bilingual. The rest of Hispanics — Millennials and others — understand English and or speak a functional level of English which means they understand simple conversations and communications but not complex conversations such as medical, financial, or technical English.
The best way to reach Hispanic consumers in contemporary times is with relevant messages, not language. This becomes more important in categories that are known only in the context of living in the U.S. like computers and electronics, financial, insurance, health therapies, and other. Sure, there is still a need to market in-language, but it all depends on the category.
Additionally, marketers need to recognize that Hispanic consumers are changing the “mainstream” consumer not just in ethnic composition but in mindset. Like all other immigrant group before them, Hispanic values, preferences, taste profiles, fashion, and other variables have been adopted by the mainstream (other immigrant groups have also affected mainstream, not just Hispanic). So maybe it’s time to re-evaluate who is the core-consumer and their preferences and lifestyles.
Marketers need to learn the demographics and psychographics of their consumers before assuming that ethnic background or language of country-of-origin determine the best way to reach consumers.
Target, and all savvy retailers, have to recognize that their audience is becoming more global in its’ view, regardless of their location. Differentiating target marketing through target market segmentation will be the mantra as retailers become more aligned with their markets.
While it’s true that an increasing percentage of Hispanics in the U.S. are perfectly fluent in English, the more than 30 million Spanish-speaking people in the U.S. remains a huge and poorly served market.
This opportunity is illustrated by the continued success of Spanish language e-commerce sites like:
– http://es-us.puma.com/
– http://es.cvs.com/
– https://espanol.dollartree.com/
– http://es.childrensplace.com/
– http://es.verizonwireless.com/
– http://hola.jetblue.com
– http://espanol.soccer.com/
– http://www.sears.com/es/us/
… and many more.
Communicating in Spanish with those that simply cannot communicate comfortably in English remains a great way to cater to a large consumer segment.