Economic Opportunities for the Growing U.S. Hispanic Market

Background
The Hispanic population in America, according the US Census, constitutes 15.5% of the total population, or about 47.8 million people. This number is projected to grow to 59.7 million by 2020 and to 73 million by 2030, when it is estimated one out of every five residents of the United States will be Hispanic. Mexico is the largest point of origin for Hispanic migration to the United States. In fact it is the largest point of origin for both legal and illegal immigration in general to the United States. Even when considering just the legal immigration to the United States, between 1971 and 1990, 23.1% was comprised of those of Mexican origin.

Many have recognized the many opportunities of a growing Hispanic market, both by continued immigration as well among the domestic population already in the United Sates. As a result, marketers have sought to greater understand the numerous cultural, economic, and language factors that influence consumer decision making in the US Hispanic Market. More specifically, much attention is paid to the role of Acculturation in consumer decision making within this market and whether different marketing strategies are called for in addressing the needs of both new and well-acculturated immigrants.

Theoretical Foundation

In studying the role of acculturation and its role in consumer decision making among Hispanic immigrants, it has been hypothesized that a number of factors contribute to how well someone is acculturated, namely how well they speak the language, how long they have been in the country, and their social ties to people in the community who emigrated prior to them. (Penaloza, 1994) It has also been argued that the more someone is acculturated to American culture, the greater their consumer decision making will reflect that of the domestic consumer.

Findings
In understanding the role of acculturation in consumer decision making in the US Hispanic market, it is helpful to consider consumer decision making in markets of the immigrant people’s home countries, as well as other factors such as differences in availability and price of various goods in both markets. Also important in assessing the degree of acculturation of individuals based on where they lived in their home country. (Penaloza, 1994) Those from urban areas were quicker to acculturate to the United States than those from more rural areas. Also, the length of time an individual has been in the country in addition to how well they speak the English language is an important factor as well.

With regards to food shopping, studies have shown that Hispanics from more rural areas are used to shopping at small corner stores and from door-to-door salespeople. Food shopping in the small villages takes place frequently because many do not have refrigerators and a lot grew some of their own food. Oftentimes, merchants drive trucks to various areas in order to sell vegetables, packaged food, and various household items to people right where they live. This is contrasted somewhat by Hispanics from more urban areas who shop less frequently at large supermarkets in the central business districts and have a greater ability to compare prices between brands. (Penaloza, 1994)

Upon entering the United States, which has a lot of supermarkets in rural as well as urban areas, Hispanics from both rural and urban areas typically shop at supermarkets. This is because of the cheaper prices in supermarkets but, at the same time, they also shop at smaller corner stores because they are convenient and usually offer specialty products from their home country. In terms of the domestic products they purchase, Hispanic households are less inclined to shop on price and more so on brand name and prestige. (Deshpande, Hoyer, & Donthu, 1986) Also, as far as advertising is concerned, brands have been successful in advertising products utilizing images and language that Hispanic consumers can relate to, and not simply translating existing ads to Spanish. A buyer is even more able to empathize with the advertisement and feel comfortable purchasing the product if the advertisement features Hispanic actors. (Herbig, & Yelkur, 1997)

It has been found that language is among the most important factors in the degree someone is acculturated. Whether an individual speaks Spanish only, is Bilingual, or speaks Spanish primarily and knows some English, most want to advance their language skills because they perceive it will benefit them in the workforce. Even for parents that speak limited English, their children are typically much more proficient in English from having learned it at school. (Penaloza, 1994) For this reason many families, especially older, less acculturated members, rely on younger family members for helping to understand American culture and purchase decisions.

Parents are generally encouraging with regards to their children learning English to fit in with their peers. Younger Hispanics, aside from being more likely to have proficiency in English than their older counterparts, are more likely to imitate American forms of dress
and be more interested in using this clothing for self expression among their peers. (Chattalas, & Harper, 2007) For example, it is a lot less popular and socially acceptable for a woman in Mexico to wear pants. Many older women from Mexico that immigrate to the United States keep up with this belief and typically wear dresses and skirts instead. Younger, more accultured women have less qualms about wearing pants and embracing American forms of dress. (Penaloza, 1994)

Younger Hispanics born in the United States or who were primarily brought up here are usually more acculturated than their parents and develop a sort of hybrid Hispanic-American outlook, with their consumption patterns more closely resembling their peers. (Chattalas, & Harper, 2007) More recent immigrants are quick to identify differences between American culture and that of their home country, and they often recognize changes in their own attitudes regarding work and their behavior as consumers. When they lived in their native country, people typically had less money but more free time to spend with their families and peers. It is common for Hispanic immigrants, as time goes on, to recognize them becoming more materialistic, having more discretionary income, and being more attracted to making purchases that convey status.

Conclusion
Although there are many variables that affect consumer decision making for any consumer, it is important for marketers to take into account cultural differences when targeting the US Hispanic Market. (Penaloza, 1994) One must have an understanding of the traditions, preferences and norms of a particular culture and how this culture fits in America. Also important is the process of acculturation and the way in which those
new to the country navigate its market and make purchase decisions. The US Hispanic market represents a huge opportunity for marketers to serve a growing segment of the population with the understanding that the group’s demographics are neither homogenous nor are their preferences unchanging.

Sources Cited
Chattalas, M, & Harper, H. (2007). Navigating a hybrid cultural identity: hispanic teenagers' fashion consumption influences. Journal of Consumer Marketing, 24(6)
Deshpande, R, Hoyer, W, & Donthu, N. (1986). The Intensity of ethnic affiliation: a study of the sociology of hispanic consumption. The Journal of Consumer Research,, 13(2)
Herbig, P, & Yelkur, R. (1997). Differences between hispanic and anglo consumer expectations. Management Decision, 35(2)
Penaloza, P. (1994). Border crossings: a critical ethnographic exploration of the consumer acculturation of mexican immigrants. The Journal of Consumer Research, 21(1)