Hispanics Do More Online

After initially trailing in Internet adoption, U.S. Hispanics are flocking to the Web and spending more time online than the general population, according to a new report released by the online unit of AOL Time Warner.

The U.S. Hispanic Cyberstudy, done by AOL in conjunction with pollster RoperASW, documents why many marketers have recently stepped up their online marketing initiatives aimed as Hispanics.

According to the study, nearly half of those polled got Internet access in the past two years – more than double the figure (21 percent) for the general population. Despite the late adoption, however, Hispanics are embracing the Net quickly, spending 43 percent more time online at work (13.5 hours) and 13 percent at home (9.5 hours) than the overall online population.

RoperASW conducted the poll in October 2002, questioning 301 randomly selected Hispanic online subscribers. The survey has a 6 percent margin of error. Overall Internet population data was culled from the AOL/RoperASW U.S. Cyberstudy of 1,001 home Internet users that was conducted September 2002. That poll had a 3 percent margin of error.

U.S. Census data shows that Hispanics have moved ahead of blacks for the first time as the second-largest ethnic group in the United States. With 37 million consumers identifying themselves as Hispanics and an aggregated estimated annual purchasing power of nearly $450 billion, it’s no surprise that Hispanics have become a sought after group.

Marketers have begun to take note, although slowly. The Association of Hispanic Advertising agencies issued a report in April 2002 that said leading advertisers spent about 3.2 percent of their marketing budgets on Hispanic advertising in 2001, trailing far behind Hispanics’ 13 percent share of the U.S. population. However, spending on Hispanic marketing initiatives has increased sharply from 1999, when they represented just 1.8 percent of ad spending. According to CMR/TNS Media Intelligence ad forecast for 2003, the trend will continue, with Spanish-language television experiencing the greatest increase in marketing dollars this year, growing 9.2 percent – far outpacing the middling growth anticipated in most other media.

While spending on media like TV has been tagged as a priority in most marketing campaigns aimed at Hispanics, online initiatives have shown some promise. comScore Networks estimates that about 15 million Hispanics are online, growing at about 20 percent a year.

The AOL study showed Hispanics still trailing the general Internet population in online purchases, spending an average of $439 over the past three months compared to $543 for the overall population. About 37 percent of respondents said they expected to increase their e-commerce activity. Compared to the overall Internet population, the poll found Hispanics more likely to shop online for entertainment products, such as movie tickets, CDs and DVDs. Respondents were markedly less likely to buy consumer electronics, computers and clothing.

“E-commerce has emerged as one of the most active areas for Hispanic online consumers,” said Peter Blacker, vice president of international and U.S. Hispanic marketing at AOL. “The message is clear: being online is an essential part of any advertising mix targeted toward the exciting Hispanic market.”

Despite their lower e-commerce activity, the AOL study found Hispanics much more amenable to online marketing messages: 41 percent said they found online advertising informative, while just 24 percent of all Internet users did. Also, Hispanic Internet users turned to the Web for researching products, with 61 percent learning about a product or service online and 50 percent doing price comparisons.

The Hispanic population seems to be leading the way in the adoption of certain home technologies too. Knowledge Networks/SRI found that Hispanics are more likely to have a PDA, DVD player, home theater, and digital satellite television service compared to whites and African Americans, but are less likely than the other groups to have a personal computer, home Internet access, or a cellular phone.

“Trends in technology ownership help us identify the media worth watching for the future,” said Knowledge Networks vice president David Tice. “In particular, it seems as if Hispanic buyers may be gravitating to TV technologies that meet their needs for greater diversity in programming, such as the expanded choice of Spanish-language or ethnic cable networks available from a satellite service.”

Hispanic Ownership of Selected Home Media Technologies
Hispanics African Americans Whites
DVD player 34% 33% 30%
Home theater 36% 29% 26%
Digital satellite TV 22% 8% 19%
PDA 15% 12% 14%
Home computer 51% 52% 65%
Household online 44% 46% 57%
Source: Knowledge Networks/SRI, Spring 2002 Ownership Report, The Home Technology Monitor™

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