The highly influential, potentially profitable, Hispanic small business owner (HSBO) is attracting more attention from the nation’s lenders and issuers. A growing segment, the HSBO niche is one that more credit unions should consider as they go into strategic planning season this fall.
Here are a few things to keep in mind as your cooperative contemplates including this target market in its 2018 member growth and engagement strategies.
HSBOs need more than money.
Many HSBOs are on their own, without the benefit of boards of directors, shareholders or even executive teams. Nearly 90 percent of Hispanic-owned businesses, in fact, are without paid employees. This underscores the importance of leadership support and financial guidance for this critical segment of the Hispanic population.
HSBOs are young.
According to Geoscape, Hispanic entrepreneurs are more youthful, connected digitally and socially engaged than non-Hispanics overall. And their young businesses are growing at an incredible rate – more than 15 times that of all U.S. firms.
HSBOS are nuanced.
There are HSBOs of all types. Although the largest segment (at nearly 40 percent) was born in the U.S. and is English dominant, 20 percent of HSBOs are Spanish preferring and immigrated to the U.S., retaining many of their Hispanic cultural practices. Talking with instead of at HSBOs is a key way to differentiate your expertise and brand from competitors.
HSBOs are digital natives.
Hispanic entrepreneurs use the Internet, including social accounts, to supplement resources and expertise they don’t yet (or never intend to) have. They crave real, fast, smart answers to their problems and will look to digital resources to get them.
An HSBO campaign in action.
A noteworthy example of a successful marketing campaign targeting HSBOs comes from car maker Toyota. To increase focus on Hispanic communities, including small business owners looking to invest in work-related vehicles, Toyota created the “Más Que un Auto” campaign. It was designed to address the deep connection many Hispanic drivers have with their vehicles. Toyota owners were encouraged to use Toyota’s interactive website to create custom (and free) nameplates for their vehicles. As a result, the Toyota Facebook page received thousands of likes, and different social media platforms were buzzing about Toyota’s unique car decals. The result of this and other Toyota campaigns? The car maker is now the top-selling brand for Hispanics.
U.S. Hispanics are one of the most financially underserved segments on the radar of credit union marketers. This is precisely why so many have designed specific growth strategies around Hispanic membership. Those strategies are working, but they may have to evolve to become more targeted as the burgeoning Hispanic community becomes more nuanced. As you launch, adapt and evolve your credit union’s Hispanic growth strategy, go deep. Evaluate the market in your area and drill down to the segments and niches that make the most sense for your capabilities and mission. Is the HSBO market waiting for you?
This article is a modified excerpt from the white paper “The Digital Lives of Hispanic Consumers.”