Serving the Hispanic Market: Goals Get Results
I once heard someone say, big goals get big results, no goals get no results. I’m paraphrasing, but the essence of the statement has always stuck with me, especially when researching Raddon’s recent publication, Effectively Serving the Hispanic Market.
While exploring financial behavior and attitudinal insights from this vital segment within the U.S. financial ecosystem, Raddon compared findings from banked Hispanic households to the average U.S. consumers nationwide, regardless of ethnicity. Findings show the U.S. Hispanic/Latino consumer is highly financial goal oriented, regardless of income level, deposit balances, or generation. Roughly 94% of Hispanic households claim they have financial goals, in comparison to 82% of all consumer households, nationwide.
After drilling down to see what types of goals matter more, having enough funds for retirement is top of mind, for both Hispanic households and the average U.S consumer. While the list of goals to select from was extensive, participants in the study identified purchasing a vehicle, reducing consumer debt levels, buying a home, and paying down student loans, as areas that mattered most. And while these are not unique financial goals to the Hispanic consumer, data comparisons show Hispanic households are more likely to identify these as goals they want to achieve.
When comparing deposit balances, Hispanic households skew heavier towards the lower end of the spectrum, 37% have less than $1000 versus 23% of all U.S. consumers (yet there is relatively no difference between the average consumer and Hispanic households when we’re looking at balances $50,000 or greater). Marketing or messaging with simple savings goals to gradually increase balances is going to be a key area of engagement. As well, reaching out just as aggressively to those with the larger balances will be important.
This segment of the population places significant value on financial literacy programs that assist in better managing their money. Over half (60%) said a financial literacy program offered by their primary or most important financial institution would be extremely/very valuable. Segmenting the Hispanic consumer, we see Millennials, Gen X, and those who are first generation in the United States felt even stronger about the value in such a literacy program.
As they evaluate the financial outlook of Hispanic households in the US, financial institutions should understand which goals matter to which consumers. More importantly, they should appreciate that this is such a goal driven segment of the population. Institutions have an opportunity to connect with and support consumers who place significant weight on striving to achieve their objectives. Simultaneously, their strong need/desire for education and guidance will enable consumers to achieve those goals.
As we’ve seen in the past, achieving one financial milestone gives fuel for the next goal: a virtuous cycle. Addressing their goals benefits the U.S. Hispanic consumer, and it can deliver lasting results for the financial institution through a deeper relationship with those customers.