No group watches more television than African-Americans (37% more) who lean heavily toward programming that includes diverse characters and casts. Black women watch more television than their male counterparts.
Of the $75 billion spent on television, magazine, internet, and radio advertising, only $2.24 billion of it was spent with media focused on Black audiences. Black businesses, agencies and media continue to wrestle with this disparity as it is not reflective of the overall, high consumption patterns and behavioral trends of the Black consumer.
Other demographic segments have identified Blacks as a driving force for popular culture, with 73% of Whites and 67% of Hispanics who believe Blacks influence mainstream American culture.
The Black population grew 64% faster than the rest of the country since 2010, amassing a total of 43 million people; this includes individuals who are Black and another race.
The reverse migration continues as younger, college-educated Black professionals head South. Entrepreneurs have an opportunity to develop a “southern strategy” to connect with the more than 10 million African-Americans in 10 key southern markets.
“Black buying power continues to increase,
rising from its current $1 trillion level to a
forecasted $1.3 trillion by 2017.
Despite historically high unemployment rates,
Blacks have shown resiliency in their ability
to persevere as consumers.”
Black consumers are an underestimated force in the American economy, but not for long.
A new Nielsen report on “the untold story” of black consumers, especially affluent ones, shows that as the black population grows, so will its economic influence and buying power.
The report highlights 2015 as a “tipping point” for black Americans in their “unprecedented impact” across a number of areas, especially television, music, social media and on social issues. Demographic trends combined with the power of social media have collided to empower an increasingly educated, affluent, and tech-savvy black consumer base. As a result, it’s a key time for companies to “build and sustain deeper, more meaningful connections” with black consumers, according to the findings.
“We're going to see a change in the face of America, as multicultural communities and populations grow more. Companies who aren't addressing that issue now are going to find themselves a bit out of sorts when the minority become the majority,” says Cheryl Pearson-McNeil, coauthor of the report and Nielsen’s senior vice president for strategic community alliances and consumer engagement. “Marketers have got to keep pace in understanding what's important to diverse communities.”
Black buying power is projected to reach $1.2 trillion this year and $1.4 trillion by 2020, according to a report from the University of Georgia’s Selig Center for Economic Growth. That’s 275 percent growth since 1990, when black buying power was $320 billion. Already black consumers represent the largest consumers of color group in the marketplace, the report shows. That trend will continue as the country becomes more diverse, driven in part by growth in immigration from the Caribbean and Africa.
Because they’re younger on average, black consumers are trendsetters and tastemakers for young consumers of all races, according to the Selig Center. They define mainstream culture and wield immense influence over how Americans choose to spend their money. Any marketing campaign targeting millennials “must include messages to reach African-American youth,” notes Nielsen.
THE ECONOMIC SITUATION
Savvy marketing experts have picked up on this and tailor their campaigns to win over the hearts and wallets of black consumers. But understanding black Americans and how to appeal to them is still a work in progress for many companies. Pearson-McNeil says many need a strategy—and soon. “I think some companies are still figuring it out, honestly,” she says, “which is why we spend a lot of time ensuring that our clients are aware of the changing demographics, and making them feel comfortable with this information so they know how to figure it out.”
As the infographic shows, a number of factors have converged to elevate black consumer power. Black high school graduates are now more likely than their white peers to enroll in college. They’re not only younger and educated, they’re tech-savvy and have seen a major uptick in income over the past decade. Growth among each income category above $100,000 has surged, especially for African Americans making $200,000 or more annually.