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The Most Influential Consumer Segment Since Baby Boomers—Upscale Latinos

There's no disputing that Hispanics in the U.S. are
consuming media at a growing rate, and that marketers are spending more ad
dollars to reach this growing market.

Kantar Media's recently released ad spending data for the
first quarter of 2013 finds that when compared to most general-audience media
platforms in terms of ad growth, Hispanic media showed significant increases
compared to English-language media.

Through the first three months of 2013, Spanish-language TV
was up 13.5% in ad revenue for the seventh consecutive quarter of double-digit
increases. Meanwhile, general-audience cable was up 5.2% in ad revenue, while
the English-language broadcast networks were down by 5.2%.

And those increases also carried over to magazines and
newspapers. Hispanic print magazine ad revenue for the first quarter was up
12%, compared to just 1.8% for general-market consumer magazines. Hispanic
newspaper ad revenue, while up just 1.4%, increased, while English-language
national newspaper ad revenue declined by 9.2% and local newspaper ad revenue dropped

But while the Hispanic marketplace has become a game changer
for many marketers, not every Hispanic consumer is created equal.  A
recently released Nielsen study finds that within the broader Hispanic
demographic is what it describes as "a powerful core segment" that accounts for
37% of Latino spending power.

According to Nielsen and the Association of Hispanic
Advertising Agencies, "this viable and sophisticated market of upscale Latinos
lives in a world of cultural duality, and provides lifetime value and upside
opportunities for many high-end and luxury brands."

The report, titled "Upscale Latinos: America's New Baby
Boomers," defines this group as Hispanic households earning $50,000 to $100,000
in annual income, and says it will "drive shifts in category consideration,
purchasing behavior and brand relationship."

Who are these upscale Latinos? Well, 75% of them are under
age 45, 77% have households with four or more people and 60% live in the
southwest and the Pacific region of the U.S.

Upscale Latinos, with a median age of 33, are younger than
upscale non-Hispanic Whites, who have a median age of 39.

How large is this upscale Hispanic segment? In 2012, it
accounted for about 29% of the Hispanic population in the U.S., or about 15
million people.

While upscale Latinos reside across the country, they are
mostly concentrated in urban areas such as Los Angeles, New York, Houston and
Miami, although the report says they also show "significant representation" in
secondary markets such as Honolulu, Oklahoma City and Washington, D.C.

Upscale Latinos are highly educated, starters of new
businesses, tech-savvy and are often viewed as trendsetters among their peers.
The report adds that they are likely to use smartphones, own iPads and
subscribe to one of the top four U.S. mobile providers.

With more than half having attended college, the report
states that upscale Latinos are more likely to own their own businesses than
upscale non-Hispanics. The upscale Hispanic segment also has a higher
concentration of white-collar professions than total U.S. Hispanics.

Upscale Hispanics place a greater emphasis on saving for
education than upscale non-Hispanics, tend to own their own homes, with half
having financial investments and 86% maintaining savings accounts. They are
also 50% more likely to manage their financial accounts from a mobile phone,
the report says.

The deeper pockets do not translate to increased
assimilation, the report adds. "Upscale Hispanics live in two cultures, as
three-quarters speak both English and Spanish. While upscale Hispanics are
slightly more English-dominant, their strong cultural duality and bicultural
behavior is reflected in their media consumption."

More than one-third of upscale Hispanics watch content in
both languages; English-language comedies, documentaries and children's
programming is most watched. The report also finds that upscale Latinos switch
to Spanish-language TV for cultural events, concerts and sports.

The report finds that upscale Latinos spend more on health
and beauty products than non-Hispanic Whites and Hispanics overall. They
are also more health conscious than the general U.S. Hispanic population.

How important is this segment to marketers? The report finds
upscale Latinos control $4 of every $10 the U.S. Hispanic population spends.

The Nielsen report concludes by stating:
"Marketers have a unique opportunity to identify the needs of an evolving
upscale Hispanic household. With an interest in building net worth and
simplifying their lives, upscale Latinos are fueling the growth of America's
middle class while maintaining a bicultural lifestyle—one that streamlines
their multigenerational responsibilities and enriches their American Dream."