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President Obama’s executive order de facto increases the documented Hispanic population in the U.S. by almost 5 million. That, per se, has a positive impact on Hispanic marketing and advertising. Below 10 things you need to know.

1. New Opportunities for Insurers and Financial Service Providers

obama talking on immigration policiesHispanics who used to be afraid of giving away information needed to qualify for loans, credit cards or insurance will now be able to provide essential information which helps financial service providers qualify potential customers. That means that these newly legalized Hispanics will now have access to loans as well as to insurance, credit cards and other financial services. The implication? The Hispanic opportunity just got bigger for major property and casualty insurers, credit card companies as well as big retailers who provide consumer loans to finance their sales. In the long term, many of these immigrants will formally settle roots in their communities -thanks to the protection measures announced by president Obama last Thursday- and start buying homes, investing in higher education, and starting their own businesses. All this helps the economy as a whole but particularly increases the demand for financial services, insurance and homebuilding.

2. Demand for Legal Services

In the short term sectors like the legal counseling will see a constant trickle of customers that need representation to apply for the newly established protected status.

3. Retailers can now expand Loyalty Marketing Programs

Supermarkets now have an opportunity to increase loyalty card program marketing, which undocumented Hispanics, until now did not register to out of fear of giving information away. If we take into account that Hispanics clearly over-index in brand loyalty compared to the rest of the U.S. population, it is safe to day that retailers are in front of a substantial opportunity.

 

 

4. California and Texas will get a major boost from the legalization of undocumented Immigrants

California State Flag Which are the states that will be most impacted from the legalization of undocumented Hispanics?
Definitely California, where 25% of the undocumented population in the U.S. lives according to the Non-For-Profit study Group ProCon,org. California is followed by Texas (16%) and Florida (6%).
Note: More than 90% of undocumented immigrants come from Latin American countries and most of the remaining non-Hispanics are from Asia.)

 

5. Marketing to Spanish-dominant Hispanics will become more important

spanish or englishThe English-dominant and bilingual sector of the Hispanic population has been growing more than the Spanish-dominant sector, as the Hispanic population has been growing more through new births in the U.S. than through new immigration. Now, with the newly legalized population of almost 5 million Hispanics (who will tend to be recent immigrants as opposed to second or third generation Hispanics), the pendulum swings back a bit towards Spanish-dominant. It is not that when they were undocumented they did not consume media or buy products and services, but that by now being an official part of the U.S. population their safety and certainty when making purchasing decisions will grow.

6. Less Desktop more mobile

It is safe to assume that most newly documented Hispanics will have a mobile phone, while not necessarily a desktop computer. Mobile Marketing will become even more important.

 

 

 

7. Increased Offline Media Usage

While usually heavy mobile users, new immigrants tend not to be as digitally savvy as, say, the typical Hispanic Millennial. They are heavy consumers of off-line media such as linear TV and newspapers and magazines.

8. In the medium term, Digital Media Usage will also get a boost

Now being able to access credit, this newly legalized group will get access to PC’s, OTT video services and other digital content and media.

9.Expect increased Marketing and Advertising efforts from the Government

“Deferred Action for Childhood Arrivals (“DACA”) was a smaller scale initiative by the Obama administration to benefit the undocumented youth. We have seen from our digital outreach experience that these new opportunities encourage new communication initiatives, and undocumented Hispanics began not just enrolling in the program but in many cases they even found a pathway to citizenship”, says Marcelo Rodriguez, Managing Partner at NYC based Grupo Parada. The federal government will definitely increase its marketing efforts to inform the newly legalized immigrants about the steps they need to take to formalize their legal situation. Rodriguez cites Google Research that states that when it comes to government issues Hispanics go to the source. Consequently, online searches related to citizenship and immigration are within the top 3 most popular reasons for U.S. Hispanics’ 70 million monthly visits to government websites.

10.Positive Impact on Home Ownership and Home Values

descarga (3)About a year ago, President Obama showed up at a Phoenix high school to promote changes to immigration law, just as he did Friday at a high school in Las Vegas, (a speech which was broadcast live by Telemundo) The focus of the speech back then was responsible homeownership, not immigration. But he insisted the two are closely tied. “When more people buy homes and play by the rules, home values go up for everybody, and according to one recent study, the average homeowner has already seen the value of their home boosted by thousands of dollars just because of immigration,” Obama said.

The case for Hispanic marketing just got (even) bigger. Yesterday’s executive order de facto increases the documented Hispanic population by almost 5 million consumers (95% of the undocumented population is Hispanic). While Obama’s executive order does not offer a permanent solution, it brings certainty and legality to millions of undocumented Hispanics. What are the marketing implications according to major players in the marketing and media space?

descarga (1)The U.S. will get its biggest immigration makeover in three decades in a step that is expected to eventually legalize some 5 million illegal immigrants. Any measure that makes it for the undocumented Hispanic population safer to live in the U.S. will have a positive impact on marketing. “I think the issue is that if the millions of undocumented come forward and instead of the U.S. Hispanic population being 17% of the overall population the percentage jumps closer to 20% we could potentially see an increase in advertising spending which we typically see right after census numbers are issued,” says Enedina Vega-Amaez, Vice President/Publisher of the Meredith Hispanic Ventures Group.
Enrique Arbelaez
, co-founder and partner of advertising agency XL Alliance, cautions that while “the reported Hispanic population numbers will increase, we have always worked with the assumption that Census numbers are underestimated by at least 10%+,” .

If instead of the U.S. Hispanic population being 17% of the overall population the percentage jumps closer to 20%, we could see an increase in advertising spending which we typically see right after census numbers are issued.

 

Categories Impacted

XL Alliance’s Arbelaez notes that the executive order also” brings higher income opportunities. Living under the shadows limits the jobs they seek. Now these jobs and services will be expanded as they won’t fear giving away information. Think all types of Insurance, Financial Services and any other service that require personal information.” As an example of an opportunity Arbelaez cites supermarkets who have “an opportunity to increase loyalty card programs growth, which Hispanics don’t register for due to fear of giving info.” Penni Barton, publisher of Al Dia Texas in Dallas, says that “most of these immigrants are already part of the economy, but having access to better job conditions might translate to an improved economic status, and potentially higher purchasing power. In the short term sectors like the legal counseling will see a constant trickle of customers that need representation to apply for this protected status. In the long term, we suspect that many of these immigrants will formally settle roots in their communities (thanks to the protection measure) and start buying homes, investing in higher education, and starting their own businesses. This is usually the case – legal certainty leads to stability and progress.” “We may see increased mobile/digital usage as this group of 5 million gets access to credit,”adds Lee Vann, CEO and Founder of Digital Ad Agency Captura Group.

Unfortunately marketers tend to stay in the sidelines because immigration reform is a divisive topic. I believe that if your company or industry is reaping the benefits from Latino consumption sales then you should take a stand to show gratitude and gain the loyalty of this desirable consumer.

 

Increase in Spanish-dominant Share

descarga (3)The addition of almost 5 million documented Hispanics to the population also means that the Spanish-dominant share of the Hispanic population will increase and somewhat counterweight the growth of the English-dominant population. Al Dia Dallas’ Penni Barton notes that “in markets like Texas and other border states the majority of the potential beneficiaries of this measure are Spanish-dominant Hispanics.” “After all, the nature of a Hispanic immigrant is that Spanish is their first language,” says Enrique Arbelaez from XL Alliance . He cautions, however, that the media consumption habits of these Hispanics  may not necessarily change because of their new legal status.

Lucia Ballas-Traynor, Co-Founder & EVP, MamásLatinas, suspects that the majority of the undocumented immigrant population is Spanish-dominant. However, she claims that “every Latino has been affected by the inaction around immigration reform. Most Latinos have a friend, family member, neighbor, colleague or employee who is undocumented. Our extended definition of familia means it affects Latinos of all acculturation levels.” Ballas Traynor adds that “until undocumented immigrants receive long term legal status I don’t think their media consumptions habits will dramatically change. If their legal status changes permanently then I think digital media – social, e-commerce and other channels will see a greater degree of participation as they come out from the shadows.” Similarly Captura Group’s Lee Vann notes that “Of course these immigrants will have access to better jobs, loans and be able to travel more freely which will have a positive impact on the economy, if you think about it, the 5 million undocumented immigrants have been integrated into the economy, consuming content, viewing ads and purchasing products.”

 

Caution: Not permanent

It is important to take into account that Obama’s executive order is temporary in nature and not really a long-term comprehensive plan. Says Al Dia Texas’ Penni Barton: “While it lends a helping hand to some, it is not a comprehensive solution to the general issue of illegal non-authorized immigration.”

Mama’s Latinas Lucia Ballas-Traynor agrees with Barton, “until we have long term and comprehensive immigration reform I don’t think there will be a significant impact on Hispanic marketing. President Obama’s executive action is shielding undocumented Latinos from deportation and providing temporary legal status which will allow Latino families to remain united. However, his plan does not seem to provide a pathway to citizenship and most importantly no entitlement to federal benefits such as health care. I hope his move promotes Congressional action around the issue of immigration reform which has been at a standstill for decades.”

 

Obama’s Executive Order
Under the plan announced last night by Obama, undocumented immigrants who have lived in the United States for five years or more, have children who are citizens or legal residents, formally register, pass a criminal background check, and are willing to pay their “fair share” of taxes will be able to stay in the country without fear of deportation. The rules could impact up to 5 million of the more than 11 million undocumented immigrants believed to be residing in the U.S. The crux of the White House’s plan is to protect undocumented parents of children born in the US from deportation. It would also expand a program created by the administration in 2012 called Deferred Action for Childhood Arrivals, or DACA, which allows young people who were brought into the country as children to apply for deportation deferrals and work permits. The plan would extend eligibility to people who entered the United States as children before January 2010 (the cutoff is currently June 15, 2007). It would also increase the deferral period to three years from two years and eliminate the requirement that applicants be under 31 years old. About 1.2 million young immigrants are currently eligible, and the new plan would expand eligibility to approximately 300,000 more.

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