By now, many marketers have heard of the tremendous opportunities the United States. Hispanic consumer represents in terms of numbers and purchasing power. However, in the age of hypersegmentation and targeting, Millennials and bi-cultural Hispanics have risen to the top of marketer’s go-to Hispanic sub-segments. While most companies focus on this target, there is an untapped consumer segment that has serious growth potential, Hispanic business owners.
Many consumer marketers dismiss this segment as a B2B target. What they fail to remember, however, is that there are people behind businesses; business owners are people too, making them a unique B2C marketing opportunity.
Per a recent study by the Stanford Latino Entrepreneurship Initiative (SLEI); Latino firms continue to be created at faster rates than the national average. While new business creation slowed through the recession overall, Latinos continued to create firms at similarly high rates as before. The 2012 Census counted 3.3 million Latino firms, making up 12% of all U.S. firms. When you factor in Hispanic firms owned by two or more Latinos and family owned and operated businesses, that translates into almost 1 in 10 U.S. Hispanics being business owners.
Coupled with another statistic from the SLEI study, Latino firms are located all over the United States, with 75% in majority non-Latino neighborhoods serving mostly non-Latino customers, the halo effect of targeting Hispanic business owners is tremendous and has implications for potentially reaching non-Hispanics.
The opportunity for marketers is clear; targeting Hispanics via a Hispanic business owner perspective is a unique way to connect with a segment that almost every brand and company wants to reach. The Hispanic mother, the Hispanic family, and Hispanic food are cultural connections that have been used often by advertisers, the Hispanic business owner is one that is not often highlighted and helps marketers cut through the traditional Hispanic tropes we see.
In the past few years, Honda and Acura have positively showcased U.S. Hispanic business owners and entrepreneurs. In 2012, an ad called “Father and Son” utilized that relationship and a Hispanic-owned architecture firm for the launch of the Honda Accord redesign. And in 2015, Acura’s RDX was supported with an ad called “Cervantes”, depicting a humble and successful young businessman who never forgot where he came from. According to Luiz Salles, head of strategy at Orci, the agency behind the creative, “We wanted to show that Latinos play an important role in the business environment in the United States. A role beyond stereotypical Hispanic-heavy occupations. They are also, increasingly, professionals, business owners, and entrepreneurs. There are more than 4 million Hispanic-owned businesses in America with revenues of over $660 billion. In fact, Hispanic entrepreneurs have been starting businesses at a pace 15 times the national average over the last decade. That’s an astonishing contribution to our economy that deserves recognition — and we’re proud that Honda and Acura have done just that, recognized them.”
The Hispanic business creation rate is unique in the United States because the five-year average growth rate in the number of Latino firms has remained at double or triple that of the national average for the past fifteen years, per the SLEI report. This trend isn’t slowing down anytime soon. Targeting Hispanic business owners can not only position your brand uniquely in the minds of this growing entrepreneurial pool of consumers, it can also reach the diverse customer base that Hispanic business owners cater to, making the ROI of your Hispanic advertising dollars go far beyond Hispanic consumers.