The Hispanic Market:Too Big to Ignore

Almost from birth, Hispanics learn the importance of jewelry in their culture. When a baby girl is born, her mother or godparents will have already purchased her first pair of earrings. If the newborn is a boy, tradition also demands jewelry: an ID bracelet with an engraved date on the back, a medal, a cross, or a gold chain.

The Hispanic market for jewelry is, by custom and tradition, already well-established. Armando Serrano of S.I.E., a firm that supplies the Hispanic market in Los Angeles, says, “We are born in a gold culture. Since that moment we start to consume. We are the minority population that spends the most on jewelry.”

The key to reaching this huge, ready-made market – for retailers and manufacturers alike – is to learn about the people: what they like, what they don’t like, who they are.

The Hispanic market. Some 30 million Hispanics live in the United States, representing 11% of all Americans. The group is growing at eight times the rate of the general population and by the year 2050 is expected to reach 96.5 million. They will soon surpass blacks as the largest minority. Hispanics are young, with about half under the age of 27. They’re becoming more highly educated, and their average household income is $32,600. Their collective purchasing power comes to $300 billion.

California has the largest Latino community – including the largest number of Mexicans outside Mexico City – followed by Texas, New York, Florida, and Illinois. Mexicans constitute the largest Hispanic group, followed by Puerto Ricans, Cubans, and Central and South Americans.

Marvin H. Shaub, president of Teletienda Inc., a leading marketer of products and services to Hispanics in the United States, has this advice for anyone interested in the market: “Hispanics should not be thought of as simply North Americans who happen to speak Spanish. It’s more productive to think of them as a separate society, embedded within the country. A society with its own language and distinct culture, reached by its own media. A society pulled in two directions – wanting to blend in and be North American while remaining true to their unique heritage. A society presenting enormous opportunities to those who can see them.”

Increasingly, marketers recognize the importance of the market and are paying more attention to it. Martin Llorens, a public relations executive from Sanchez and Levitan in Miami, says, “Interest in Hispanics has grown a lot in the last five years. Hispanic TV stations, newspapers, and other media have tripled, which shows the confidence North Americans have in this market.”

The industries most in tune with the Hispanic market include telecommunications, banking, insurance, and packaged goods. Many companies in these industries – such as Bell Atlantic – have telemarketers and customer service personnel who speak Spanish, and they frequently advertise in Spanish. Jewelry companies, however, have been slow to capitalize on the market’s potential.

Cultural influence. The factors that make Hispanics ideal jewelry customers transcend hard numbers. Cultural traits – traditional ways of living and habits that may span generations – also play a role.

Hispanics are impulsive buyers, say marketing specialists. They tend more than other groups to make purchases based on pleasure and spontaneity rather than mere necessity. Llorens says that 63% “visit department stores at least once a month in groups of two or three.”

A study from Telemundo Group Inc. reveals that their average annual expenditures are higher than non-Hispanics’ in three categories: apparel and services (16% higher); personal care products and services (16%); and food (2%).

Hispanic households are, on average, one person larger than households among the general population. Latinos like to pay cash. They like brands, but more important, they are loyal customers. Shaub advises that “if you establish your name in the Hispanic market and earn a reputation for trustworthiness, you can build up substantial brand equity.”

The jewelry-buying habits of Hispanics differ from those of Anglo customers. Jorge Dib of Dib Jewelers in Miami notes that “Anglos do not buy as much jewelry. When they buy a watch, they care about price, and when it gets broken they will get a new one. Hispanics want one that lasts. They look more for quality, and they are willing to pay for that.”

Here, tradition plays a role – Latinos pass jewelry from generation to generation. They view jewelry as something that lasts forever and retains its value, something to be left to future generations. The sentimental meaning attached to jewelry is important. For many Hispanics, the real value of a piece of jewelry derives more from who owned it before than from its monetary worth. It’s not unusual, for example, to see a grandmother’s brooch modernized or even melted down and converted into a pair of rings for the granddaughters.

“Latinos prefer 18k gold,” says Norma Serrano, vice president of Omni, a manufacturer and distributor of jewelry in the United States, the Caribbean, and South America. “They have more classical taste, more European. Women are very selective and like to closely follow the fashion trends.”

Sergio Diaz from Zina Mexico, supplier of merchandise for California’s Mexican community, says, “They like baroque jewelry, heavy and big merchandise.”

Elsa Martinez-Phillips of Roberto Martinez Inc., a Los Angeles jewelry manufacturer, agrees. “They seem to appreciate wearing their wealth,” she says. “Which means they prefer to own big, bold pieces of jewelry [particularly the men].”

In gold, Hispanics have typically bought 18k, but many groups buy 10k and 14k. Armando Serrano says that 70% of Mexicans and Central Americans buy 14k. Dib says, “Cubans buy 18k, but right now some have to buy 14k.”

Hispanics from South American countries buy only 18k gold. “They see 14k and 10k as imitation jewelry,” says Jerry Rivero, president of William C. Greene in Miami.

Latino values favor small retail stores. “They value the old-fashioned personal touch and appreciate the value of forming long-term relationships,” says Martinez-Phillips.

“If you treat them well, they will be your customers forever,” observes Armando Serrano. “They are very noble.”

Hispanics like to interact, and they’re not shy about asking for information before buying. So it’s important that stores have personnel who speak their language. “Companies now realize how important it is to have a bilingual workforce,” says Norma Serrano. At present, not many jewelry companies advertise in Spanish.

Finally, jewelers who want to reach the Hispanic market in the United States need to understand that Hispanics demand good service and high quality – and they are willing to pay for them.

Religious jewelry. Dib cites some of the occasions that, in the Hispanic tradition, call for gifts of jewelry: “Baptism, First Holy Communion, birthdays, quinceañeras (a girl’s 15th birthday), anniversaries, St. Valentine’s Day, Mother’s and Father’s Day, and Christmas.” This points up the importance of religious holidays for Hispanics, the vast majority of whom are Roman Catholics.

Martinez-Phillips says, “The one jewelry category that stands out as being distinctly popular for the Latino consumer is religious jewelry. Latinos will own a gold crucifix, which goes on a gold chain, or perhaps it will be a gold medal with the patron saint of their country or another Catholic saint who holds some personal meaning. This category encompasses children’s, ladies’, and men’s jewelry items.”

Although more than half of today’s Hispanic population was born in the United States, Hispanic families like to instill in their children devotion to the patron saint of their ancestral countries. Mexicans, for example, like to wear medals with their patron, Our Lady of Guadalupe, or the Sacred Heart. Cubans prefer medals with La Virgen de la Caridad (The Virgin of Charity), Santa Barbara, or San Lazaro (St. Lazarus). Puerto Ricans also like Santa Barbara, as well as La Virgen de la Providencia (The Virgin of Providence).

A market for Hispanic jewelers. Armando Serrano says of the Hispanic jewelry business, “Right now it’s run by Hispanics who live in the United States. Other ethnic groups, such as Armenians, Japanese, and Jews, seem interested in developing this market, but generally speaking, only foreigners serve the Latino market.”

Have North American jewelers ignored the Hispanic market? William Grayson of Jan Bell Marketing, which manages jewelry departments at Sam’s Clubs and other stores, says, “It hasn’t been ignored, but it hasn’t been aggressively pursued.”

But many jewelers who serve the Hispanic market agree with Jerry Rivero: “Hispanics buy from Hispanics.”

Every year, however, more companies launch new lines of jewelry directed toward this market. One company, Modern Gold Design Inc. of Los Angeles, focuses on the Mexican population. California-based Don Roberto also focuses on the Mexican community. Roberto Martinez Inc. produces a jewelry line called Oro Latino, which is distributed nationwide.

An Ethnic Group, Not a Racial One

The Hispanic community is far from monolithic, encompassing a multiplicity of backgrounds, races, and countries of origin. According to U.S. government guidelines, “Hispanics are an ethnic group, not a racial one. They can be of any race.”

Customs and tastes vary, and advertising and marketing campaigns must be planned carefully to account for differences. For example, targeting the entire Hispanic community in the United States requires knowledge of general characteristics shared by all groups. Focusing on a local community calls for greater specificity. Research into local habits and characteristics may be necessary.

There are also differences in the way Spanish is spoken. Many words have different meanings for different communities, so care must be taken with translations. For example, a Cuban understands the word guaguita to mean a small bus; for a Central or South American, it means a baby girl. For Cubans and Puerto Ricans, the word for cufflinks is gemelos, which also means twins; Mexicans call cufflinks mancuernas. Earrings are pantallas to a Puerto Rican; Mexicans call them aretes. Again, knowledge of target markets is crucial.