Latino Statistics: You Can’t Always Count On the Numbers

They were impressive reports on the buying power of Latinos in Texas. The surveys conducted by an East Coast research firm for a corporate client showed that Latino consumers had high levels of income and education.

Too high it turns out, says UCLA professor and demographer Leo Estrada, who is paid by corporations to review surveys and studies on Latino consumers. “Some of the data couldn’t be real,” Estrada said of the reports. “I had to caution the corporation against the information.”

It was not the first or last time Estrada has run across what he considers flawed reports on Latino buying power and habits. Last year, Estrada was satisfied with only two of the nine reports he reviewed. “It was kind of scary,” he said of the discrepancies he found.

Many corporations are tripping over themselves to learn more about the fast-growing pool of Latino consumers. But in the rush, some of those firms may find a surprising lack of reliable statistics and some questionable research as well, say many marketing and research executives.

The questions regarding some Latino market research come at a time when such information is in high demand. Food and consumer product makers and retailers have been attracted to the Latino market, because Latino families--partly because of larger family size--proportionately tend to buy more groceries, personal-care products and beverages than their Anglo counterparts.

But information on what Latinos buy and how much they spend on certain products and services is relatively scarce when compared to the general population. Furthermore, nobody is really sure how many Latinos live in the United States or how many use Spanish versus English--important questions when executives consider and advertising and marketing strategies.

Most market research on Latinos, however, is valid, researchers say. Furthermore, many executives argue that there is nothing to worry about. But enough flawed and questionable work has surfaced to keep some researchers and companies on their toes.

“There are some reliable and some unreliable sources out there,” said Fil Fernandez, manager of Latino marketing at Polaroid. In some cases, “new companies don’t have the type of resources (that the more experienced firms do), and their forecasts must be taken with a grain of salt,” he said.

Estrada is more blunt: “There are some real charlatans out there.”

“We have not had enough good research on Hispanic America to support some of the decisions being made on investment in the market,” said the director of Latino marketing for a multibillion consumer products manufacturer.

That leaves research firms to do their own projections and forecasts, increasing the potential for errors and exaggeration. “The lack of information leaves us in a difficult position to do the best job we can,” said Edwin Batson, research manager at the Los Angeles office of Maritz Marketing Research.

Researchers say they have seen numbers exaggerated to whet the appetite of corporations.

At recent marketing symposium a research executive said that one of his peers told the audience that the average household income for Latinos is higher than that of Anglos. “The audience was laughing--it was ridiculous,” said the researcher. “It was also annoying because it wasn’t true. That has hurt the credibility of Hispanic research.”

“Some of the research that has been done, and frankly, research that a lot of companies in the ad business relies on, has been done for self-serving reasons,” said Carl Kravetz, vice president and general manager for Ferrer/Ad America Corp., a Los Angeles firm specializing in Latino advertising.

Some of this research is commissioned by Latino television stations and publications, Kravetz said. “They are made to prove a point: There is a substantial market out there.” And the idea is that their media can be used to reach it, he said.

Researchers complain that many corporate clients have been stingy with the money they allocate to study Latino buying habits, forcing many research firms to cut corners. “Clients puts restraints on us in term of timing, cost limits, and plus they put us into a bidding framework,” said Carlos E. Garcia, research director at Research Resources, a Westlake Village market research firm that specializes in the Latino market. “Those factors mean that you often don’t do the ideal study.”

Garcia says he has often advised clients that their budgets will not allow proper surveys to be conducted. “You can say these things to these clients, but they don’t always care,” he said. “Their brand managers want it, and they want it in six weeks. The opportunity to do the ideal study is very rare.”

Still, many marketing executives say they have no particular problems with Latino market research. “You would be just as cautious with Latino (market research) as you would have with general market research,” said Isaac Lasky, vice president of Latino marketing at W. B. Donner & Co., a Detroit advertising firm. “You have to do your homework.”

The lack of solid information on Latino buying habits seems to have deterred few corporations from pursuing the group. “I have heard in conversation with ad agencies that sometimes you get an exaggeration of the purchasing power of Latinos,” said Bernadette Mansur, spokeswoman for Avon Products. But that doesn’t worry the cosmetics company, she said, which continues to aggressively court Latinos with an army of Spanish-speaking Avon sales representatives.

“I see exaggerations all the time because many think it makes us look better,” Estrada said of statements and figures given by Latino marketing executives and politicians. But, “you don’t have to exaggerate. You would have to be blinded not to see the potential of the Latino market.”

First Federal Savings Gets Poetic on Holidays

“Thousands of times in my life

I’ve meant to say the words,

“Thank you, Mom . “

At first glance, these lines read as though they belong in a Hallmark card. This ode to Mom, however, is part of a radio advertisement for Santa Monica-based First Federal Savings Bank.

The commercial, which features an introduction by First Federal Chairman William S. Mortensen, is one of part of a series of inspirational messages and prayers the financial institution has begun to air in connection with Mother’s Day, Memorial Day, Father’s Day, Thanksgiving, Christmas and Passover, as well as a message praising teachers. Reprints of the messages will be made available at all of First Federal’s 15 branches.

“We were looking at a way to be truly unique,” said Stuart Newmark, president of Newmark Associates, the Los Angeles ad firm that created the campaign for First Federal, which has nearly $2 billion in assets.

The series of radio commercials came about as First Federal officials were searching for a new ad campaign. A “Thanksgiving Prayer” commercial during the past five years has proved very popular, so Newmark decided to expand the theme to other holidays as well.

The staff-created prayers and messages are not targeted at any one religious group, Newmark stressed. “We tried to stay away from that totally,” Newmark said.

Now that the campaign is running, Newmark has learned to pay closer attention to the calendar and radio after a local radio station aired the Mother’s Day poem a week after the fact. “I almost drove off the freeway when I heard it,” Newmark said.