By Pete Rizzo, Editor (@pete_rizzo_)
Hispanic consumers are projected to comprise 30 percent of the population by 2060, but new research has revealed it will be Hispanic women, not Hispanic men, who will drive the purchasing decisions in these households.
Released on August 1, Nielsen’s “Latina Power Shift” report found that Latinas will be the primary influencers of consumption among all demographics across a number of key categories: banking, cosmetics, household products, media and real estate, and provided data to support the notion that this shift is well underway.
Eighty-six percent of Latinas told Nielsen they believe they are the primary shopper in their household, meaning they command Hispanic shoppers’ $1.2 trillion in buying power. Likewise, they are catching up to Hispanic males in big-ticket purchases, driving more home and automobile purchases than before.
“They are a growing force at school, the office, the supermarket, the shopping mall and the Internet,” the report authors wrote. “Their desire to succeed is second only to their passion to connect with friends, family and others in their community.”
In this PYMNTS.com Data Point, we break down the study’s findings to highlight the major takeaways for businesses, marketers and startups that are looking to foster loyalty among this coveted demographic.
Latinas Are Driving Purchases Today
Drawing from three reports conducted from 2011 to 2013, Nielsen showed that Latinas are already the sole decision-makers in their households across key categories like food, clothing, pharmaceutical and beverage consumption.
Also notable is that Latino males were not the sole drivers in any decision-making category. In the categories of family finance, social activity and pharmaceuticals, less than 10 percent of Latina women indicated that the Latino males in their family were making purchasing decisions alone.
Latina Spending May Be Slowed In The Short-Term
While the study illustrated how Latinas could become the leading demographic in terms of spending power, its evidence suggested that the change is likely to be incremental.
Over the next five years, the majority of Latinas – 73 percent – are expected to spend their extra money paying off debt. Sixty-three percent and 38 percent said they would allocate extra funds toward general and retirement savings, respectively, during this time. Twenty-one percent will spend money on their education or a new home.
Home electronics and personal electronics were the largest discretionary spending categories, with 20 percent and 19 percent of respondents saying they would spend extra money on these purchases through 2018.
How Online Consumption Affects Decision-Making
In part because of their increasing use of technology and social media, Latinas will also drive eCommerce spending in these households. Eighty-one percent of Latinas agree strongly or somewhat that they have purchased a product online based on online information.
Sixty-nine percent have purchased a product at a physical store based on this info, and 62 percent are engaged with brands online.
What’s Fueling This Growth?
Nielsen indicated that this power shift is taking place because Latinas are increasingly the primary wage earners in the Hispanic household. More than 70 percent of Latina high school graduates are going on to college, compared to 61 percent of Latino males. Likewise, 21 percent of Latinas now earn more than $75,000 annually, up from 16 percent in 2003, the report said.
Technology is also playing a role, according to Azim Tejani, the co-founder of YaSabe, a mobile and local search destination for Hispanics.
“Latinas have historically had greater responsibility for running and managing the household, but technology has empowered them even more to take the lead on purchases and financial decisions of all kinds,” Tejani told PYMNTS.com in an interview. “Technology has given them access to information at their fingertips. Hispanic women over index in every poll we see when it comes to search and purchases both online and mobile.”
However, the study only polled Latinas for their insights. Would Latinos report similar findings if they were the focus of a Nielsen study?
“It would be interesting to read what Latino men would say if asked the same question, however, I think that this is a case of reality and not just perception,” Nadia Jones, founder of multicultural blogger support group, The Niche Mommy Network, told PYMNTS.com in an interview. “We have the benefit of economic studies, consumer reports and job reports that support the findings that Latina women are earning more income, spending more and influencing more.”
For more insights and data on the rise of the Latina shopper, download a copy of the full Nielsen report here.