L. Maria Vergara is president of NAHREP Consulting Services,
a marketing consulting company specializing in the Hispanic
market and housing industry. Learn more at
www.nahrepconsulting.com. Reach Vergara at
mariav@nahrepconsulting.com.
The Hispanic Homebuyer Is Changing
Reaching this growing demographic involves more than
translating brochures into Spanish
By L. Maria Vergara
The mortgage industry is complex and can be an alphabet soup of acronyms and finan- cial jargon. It can be hard to convey these ideas in a simple and understandable way.
It’s an added challenge when trying to reach an
increasingly diverse U.S. population. But it’s important.
Hispanic and non-Hispanic blacks, Asians and other
minorities are expected to make up the majority of
household growth between 2015 and 2025, according
to one study.
These trends will have a long-lasting impact on the
mortgage industry. Those companies that are able to
capture market share will win.
Many assume the key to marketing to the Latino
market — the fastest growing first-time homebuyer
segment — is to translate brochures, websites or other
material into Spanish. Though the effort is a noble one,
it’s often very ineffective and at times unnecessary.
The problem is that there is still a lot of misinformation about how to reach this increasingly diverse
marketplace.
Today’s Latino market isn’t like generations before.
Much like advertisers wouldn’t use the same approach
to the general markets as they did in the 1950s, marketing to Latinos requires a more sophisticated understanding of a dynamic group of consumers.
Evolving demographic
Here are some things to understand about the Latino
market. Hispanics are young. Seventy-five million
people in the United States are millennials, of which
25 percent are Hispanic. Although these Hispanic
millennials are similar to their non-Hispanic counterparts in many ways, they also have a strong emotional
connection to the Latino culture.
Hispanic millennials, for example, tend to pay
more attention to commercials and other advertising when those messages hit on the concepts of self-employment, having children at younger age and
family-centric themes.
Hispanics are not all Mexican. While most of the U.S.
Hispanic population is of Mexican origin, more than
a third of U.S. Hispanics are not Mexican. Historically,
the non-Mexican U.S. population has been attributed
to individuals of Puerto Rican (U.S. citizens) or Cuban
heritage. The truth is that significant growth in the U.S.
Hispanic population has come from South and Central
America over the last several years.
Hispanics are not poor. Although the industry
may associate lending to minorities as equivalent to
low- and moderate-income lending, U.S. Hispanic
household-income growth has been on the rise for
the past decade.
In fact, 7 million U.S. Hispanics have annual incomes
of over $100,000 and represent one of the fastest-
growing income segments. Companies like Lincoln
Motors have turned to specialized Latino marketing
agencies to help bolster their general advertising
campaign in order to compete with popular German
brands like Mercedes-Benz and BMW. This is a testa-
ment to the power of the U.S. Latino luxury market.
Hispanics live outside of California, Texas and Florida. Yes, it’s true that these three states alone account
for more than 50 percent of the nation’s Latino population. But there are other growth-market opportunities
that should be on your radar. Markets such as Atlanta;
Oklahoma City; Nashville, Tennessee; and Charlotte,
North Carolina, are experiencing exponential Latino
growth. As people seek affordable housing, better
work opportunities or more land, they will venture out.
Hispanics are digitally hooked. Latinos are heavy
social media users compared to whites on their usage
of Facebook ( 73 percent vs. 67 percent), YouTube
( 78 percent vs. 71 percent), Instagram ( 38 percent vs.
32 percent), and Snapchat ( 31 percent vs. 24 percent).
Hispanics speak English. Hispanic immigration has,
in fact, slowed down, yet the demographic trend continues to grow. Why? Most of the Hispanic population
growth is from native-born Latinos. Therefore, more
and more Latinos speak English.
It’s really not an issue of ability, but of preference.
Facebook released results of a study that did show that
86 percent of U.S. Latinos believe Spanish helps them
remained “connected to their culture.” Further, ads
targeting Latinos in Spanish significantly increased
their interest in the product.
An example of effective language placement can
be seen with the satellite provider Dish. They proved
that combining English- and Spanish-language programming was integral in connecting with modern
Hispanic audiences. Dish grew their Latino consumer
base by offering packages that target bilingual
households, combining two cultures into one with
DishLatino.
Winning the segment
Being Latino is a culture, not a race. It’s natural to get
excited when we see reflections of ourselves in media
and advertising. It’s the way Latinos can connect with
a brand very quickly before they even know what the
company is selling.
That’s what originators need to consider when trying to reach this demographic. It’s important to invest
in good images. Smart companies may consider conducting their own photo shoot to collect more accurate representation of Latinos versus what the stock
photography offers. Having a true representation of
Latinos of all races, ages, and socioeconomic backgrounds makes clients feel like they are not being
stereotyped.
Minorities are connected to community. There are
many studies that show that a majority of Americans
will purchase a product because a company advocated for an issue they care about. This is even truer
with millennials and minorities, who are more likely
than other generations to research the issues a company supports and the extent to which the company
contributes.
Hispanics want to feel welcomed. What’s the best
way for a mortgage originator to get this business?
Ask for it. By implementing a Hispanic market strategy
and using these guidelines, you are effectively hanging the virtual (maybe literal) “welcome sign” on your
business door. What does your effort say about your
company’s desire to win over this segment? It’s not
an emerging market anymore. This is the new mainstream economy. n
Key Points
Facts about the
Hispanic market
n Some 25 percent of millennials are Hispanic.
n Not all U.S. Hispanics are originally from Mexico.
n Hispanic household income is on the rise.
n Hispanics live outside of California,
Texas and Florida.
n Growing numbers of Latinos speak
English as a first language.
