What Do We Spend Our Money On? The Buying Power Of Black Americans
Black Americans are just 13 percent of the U.S. population, and yet, we’re on trend to have a buying power of $1.4 trillion by 2019. A new Nielsen study hints that marketers may want to start developing a better consumer-producer relationship with African Americans if they want to make big bucks.
Titled “The Multicultural Edge: Rising Super Consumers,” the report finds that the Black American sweet spot, in terms of buying power, lies in ethnic hair and beauty aids (surprise, surprise). African-American dollars make up a whopping 85.8 percent of the industry.
Coming in a distant second, the next product consuming Black American money is hot sauce. Yes, hot sauce. Sriracha and its ilk enjoy a 25.4 percent share of African-American dollars. Yum. While we’re talking about food, when it comes to unprepared meat, seafood and poultry, Blacks account for nearly 18 percent of the industry’s dollar volume.
And here’s an interesting tidbit: We are the only ethnic group who take up a significant share of the molasses, table syrup, and sweetener industry — 14.4 percent.
This, Nielsen says, is reflective of Black Americans’ proclivity to the “tastes and traditions of the American South.”
Third, hygiene products and toiletries — such as soap, body wash and fresheners — win about 17 percent of our hard-earned cash.
While knowing what Black Americans are inclined to buy is valuable, it’s also important to understand what motivates us to make a purchase. According to the Nielsen, nearly 40 percent of African-Americans expect the brands they patronize to support social causes. A whopping 78 percent of Blacks also say that their cultural and ethnic heritage is a essential part of who they are, which, in turn, can affect the purchases they make.
Nielsen adds that people of color have always been influential in attracting U.S. mainstream consumers to “ethnic traditions and tastes” such as hip-hop/rap music and fashion. The study pointed to TV’s cultural relevance shift, citing FOX’s Empire and ABC’s Black-ish and their marketability. If advertisers were smart, Nielsen concludes, they will start to move away from appealing to the usual demographic cues.
“Savvy marketers who have noticed this shift are responding with marketing efforts that recognize ethnic identity as much more malleable, fluid and contextual, while content providers create media strategies to reach these consumers with cross-cultural and linguistic dexterity,” the study said.
To wrap it all up, the study says the ROI for consumers of color are greater than the majority group.
“Culture is a key element in any effort to reach today’s diverse consumer markets,” the study concluded. “You can connect with […] a growing percentage of new mainstream non-Hispanic whites who share multicultural attitudes which are reflected in their viewing and shopping behaviors.”