African-Americans comprise 39 million, or 12.8% of the U.S. population. Although the future growth narrative is not as strong as other multicultural segments, their growth still outpaces Non-Hispanic Whites. They were responsible for 14% of population growth from 2006 to 2012, while the non-Hispanic white population actually contracted.
Demographic & Economic Facts to Know
- The second-highest purchasing power of multicultural segments ($1 trillion)
- Real total expenditures growth more than 3x that of non-Hispanic white growth (1.6% vs. 0.3%)
- 15% share of real total expenditures growth from 2002-2012, while non-Hispanic white segment accounted for 22% share of growth
What’s more, there’s a geographic consideration. Of the 39 million African-American in the U.S., approximately a third are in the Southeast. This means that markets like Washington D.C., Mississippi, Louisiana, Georgia, and Maryland host a dramatically higher share than the national average of 12.8%. So if your business is highly regional, African-American consumers may shift to become the primary target in specific markets.
African-Americans are digital influencers. They’re more likely to use smartphones, and African-American millennials are more likely to post to social media while watching live TV. From “Black Twitter” to #IfHogwartsWasAnHBCU, social media should be considered in reaching them. But careful review is needed to prioritize channel activations relative to existing media efforts for other segments.
Perhaps what’s most exciting about the African-American segment is that they significantly over-index on cultural influence: cultural engagement (at a 168 index), cultural openness (154), and cultural influence (111).
They’re what we call “true cultural conduits”—the actors behind cultural fusion with tools to influence and persuade others. This is especially important in high influence categories such as movies and beauty. Marketers would be remiss to gloss over a segment with such a powerful sway over the broader consumer base.
In this way, the investment case becomes two-fold. Reaching African-Americans generates ROI not only within the segment, but also carries a halo effect for crossover initiatives to the Total Market.
Assess the Opportunity and Take Action
Companies assessing the real opportunity that African-American consumers represent may find themselves in one of three positions. Either weak with the segment, historically strong, or uncertain about where they stand.
If you’re unsure of your brand’s position (or know it’s a weak one), it’s crucial to have a baseline understanding of your equity, share, and potential upside or “size of prize.”
Even if significant work lies ahead to close gaps, efforts don’t need to be built entirely from the ground up. Activating against multicultural segments is an ongoing calibration. Meaning, deciding when to scale through integrated efforts (when insights between segments are similar) and when to double-down on dedicated activation (when insights are distinct enough to merit this).
Alternatively, if you have a brand that you know is historically strong with African-Americans, make sure that you continue to engage. Failure to do so could result in market share atrophy at the hands of competitors, and the cost of re-engagement is much higher than retention.
Corporate idleness is the road to a sure death in today’s ever-changing and increasingly accelerating consumer landscape. That’s why we believe that assessing what the African-American segment means to your brand now and into the future is an imperative.
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