It’s time to switch gears on your thoughts about marketing to Hispanics. The Hispanic population in the U.S. is growing at a rapid pace. Based on the latest Nielsen report, they represented 56% of U.S. population growth from 2000 to 2010. That number is expected to grow 60% within the next 5 years.
Hispanics are a young and vibrant community that is changing the country in many ways. For any automaker selling cars in America, Hispanics are the future. They’re the fastest growing ethnic group and, already, they buy one of every four cars sold in the U.S.
Based on a report from RL Polk & Co., a marketing firm that specializes in automotive research, it is estimated that car sales to Hispanics have increased 27% in 2012 alone. The annual volume of new automotive sales to Hispanics for the first half of 2012 totaled $13.8 billion, as measured from January through June. That figure represents approximately $28 billion on an estimated projected annual basis.
If we compared the population growth with percentage of cars sold to Hispanics (1 out of 4) the gap will be even closer in the upcoming years. Automakers and car dealers have the opportunity to gain more business and increase sales if they are willing to understand, embrace, and respect the Hispanic culture. It’s a mindset change that needs to happen—now—in order to really capitalize on this flourishing market.
Hispanics also return to buy a new car 5 months sooner than the total population. The biggest segments for this market are compacts, midsize, compact crossovers, and pickups. However, midsize cars are the #1 choice among Hispanics, making up nearly 20% of their purchases in 2010.
There are currently different car manufacturers that are doing a great job by reaching out to this, the 2nd largest, consumer market. Toyota holds the top spot with almost 18% of the Hispanic car market. Honda and Nissan rank second and third. Meanwhile in the domestic brands, Chevrolet ranks fourth with about half the market share of Toyota.
According to the Polk report, Hispanics are as likely to buy Japanese midsize sedans as they are to purchase small, fuel-efficient American cars. They are as attracted to Ford F-series pickups as they are to Chevrolet Silverados and Ram trucks. Trucks and SUVs are still the vehicle of preference for families living in the West Coast, the Southwest, and the Midwest, and also those settled in rural areas across the country. However, almost 90% of Hispanics live in metro areas, so they basically look for family-size vehicles or small cars.
There are different factors that Hispanics have in mind when they purchase a vehicle. The car has to make a statement. Image, manufacturer, exterior styling, and technology are important factors at time of purchase. Also, the car has to fit their family’s needs. So usage plays a bigger role rather than price and style. It is important for car dealers and automakers to understand these behaviors and habits if they really want to engage with Hispanics.
In import luxury vehicles and “green” car segments, acculturation and income level play an important role. High-income Latinos are buying luxury cars at a faster rate than the general market, and those makes include Land Rover, Mercedes Benz, Ford Shelby Mustangs, and Lexus.
As they become more immersed in the American way of life, Hispanics are also acquiring a taste for cars that not only are reliable and fuel-efficient but also offer the best features and comfort. It is important to understand that even though this target group may prefer to speak English, Anglo campaigns are NOT the way to engage and capture this target audience. Hispanics are acculturated but will never be fully assimilated. So, assuming that the English language will convey the message and relate to this intricate group, it is the biggest mistake that a brand can make. Cultural nuances and message approach are key elements that will determine the success of a campaign. Engage with this audience the right way and you will rev up sales now and build a loyal customer base for the future.
