Telemundo: Latino Buying Power to Soar5/04/2003 8:00 PM Eastern
Significant gains in population and spending power will shape the Latino marketplace for years to come — and influence those trying to reach the nation's largest minority group.
Those were among the conclusions gleaned from Telemundo's Snapshots of the U.S. Hispanic Market, the first comprehensive study of the Latino population and its buying power undertaken by the network since NBC acquired it a year ago.
The recently released report, prepared by Global Insight, estimates that by 2020, there will be 63 million Hispanic U.S. citizens, versus the total of 35 million to 39 million last year, depending on the source.
In addition to maintaining its status as the nation's largest minority group, the Latino population by then will spend an annual $2.3 trillion on goods and services, versus $531 billion at present. That translates to an annual increase of 9.1%.
"This study is a significant work," Telemundo executive vice president Steven Mandala told some 100 advertising and media executives at a breakfast meeting at The W Hotel here last month. "It shows the ultimate value of Spanish-language TV advertising is in the hands of the Latino consumer."
Spending by U.S. Hispanics will be triggered by rises in employment, an increase in Latino-owned businesses and household income, the study concluded. Over the last two years, 450,000 Hispanics joined the workforce, as the general employment base declined by 980,000.
The number of Latino workers will jump dramatically over the next 13 years, as will the number of companies they manage. Latinos last year owned more than 1.6 million U.S. companies and ventures, compared to 1.2 million in 1997 and 772,000 in 1992.
Breaking Latino spending forecasts into individual categories, Snapshots
opted to limit the long-term projections to 2012, rather than 2020. Nevertheless, the outcomes loom large across the board.
For example, Latino spending at home-improvement and home center stores will more than double within the next decade, from the present $9 billion to $23.3 billion in 2012.
Hispanic spending on consumer electronics — a category that includes cable TV and such advanced services as video-on-demand and HDTV — will increase by about $3 billion to $7.9 billion in 2007, then reach $12.9 billion per year in 2012. At the juncture and level, Latinos would account for some 12% of all consumer-electronics spending.