The spending power of the American Hispanic community has been consistently on the rise. According to Nielsen, their spending power currently stands at over $1.4 Trillion; an impressive figure that can be attributed to their high population growth and rigorous work ethic. The factors that influence their spending habits are varied, but the one that distinctly stands out is Hispanic culture and education. Companies that wish to establish a foothold in this market will have to examine how it influences buying decisions before formulating their strategies.
Commitment to Family
One way in which Hispanic culture and education influences buying decisions can be seen in the Hispanic commitment to family. Despite how diverse the Latino population is, the love, appreciation, and respect for family cuts across all communities.
Latino communities take family bonds very seriously; an attribute that has quickly become one of the defining features of their culture. Moreover, educated Hispanics with high earnings spend most of their money on their nuclear as well as extended families. The result of this has been a preference for products aimed at fulfilling the needs of all family members.
Increased spending power
Increased high school and university admissions for Hispanic children, coupled with reduced drop-out rates have all led to a new generation of highly educated Latinos which increased spending power. According to Nielsen, 74% of young Latino women who graduated from high school between 2012 and 2014 successfully enrolled in college.
This figure was higher than both those registered by African-Americans and non-Hispanic whites. The high spending power has resulted in increased expenditures characterized by more purchases of expensive goods and services.
Hispanic culture and education also influence buying decisions through cultural sustainability. This is a unique characteristic that cuts across all Hispanic communities. Despite the exposure to the diverse cultures that reside in the United States, many Latino communities have remained loyal to the traditions, customs and way of life that characterize their culture. These traditions influence their spending habits by giving preference to certain goods and services. The benefit of this is that it gives companies a certain degree of predictability when formulating their marketing strategies.
Hispanic culture and education are responsible for influencing a considerable number of purchases made by the majority of Hispanics in this lucrative market. Marketers who wish to appeal to the majority of Latinos can begin viewing their prospective strategies through this prism.