laying a foundation for success with the hispanic market€¦ · •hispanics will account for over...

© 2018 Credit Union National Association. All rights reserved.

Laying a Foundation for Success with the Hispanic Market

Miriam De Dios Woodward, CEO

Coopera Consulting


Discussion Points

• The Hispanic market opportunity: Demographic and market trends

• Common misconceptions

• Do’s and don’ts

• Best practices

• Questions


Growing up as an unbanked Hispanic immigrant.


The Hispanic Market Opportunity: Demographic and Market Trends


Demographics: Country of Origin

Source: Nielsen

Top 10 Countries of Origin

1. Mexicans

2. Puerto Ricans

3. Salvadorans

4. Cubans

5. Dominicans

6. Guatemalans

7. Colombians

8. Hondurans

9. Spaniards

10. Ecuadorians


1st

Ge

ne

ratio

n • Spanish-preferring

• In the process of acculturation

• Lower household income

• Foreign-born

• Non-acculturated

2n

dG

en

era

tio

n • Born in the U.S.

• Parents immigrated to the U.S.

• Tech Savvy

• Bilingual and bicultural

• Will outnumber 1st

generation by 2020

• Semi-acculturated

3rd

Ge

ne

ratio

n

• Born in the U.S.

• Parents were also born in the U.S.

• English preferring

• More than 7 in 10 feel connected to their Hispanic heritage

• 49% believe advertisers need to do more than simply translate English-speaking commercials

• Fully-acculturated

Source: Pew Research Center, 2014

Demographics: Generational Differences


Market Trends: Projected U.S. Population Growth from 2010 to 2050

Source: Nielsen


Hispanics are young.


Hispanics are driving homeownership.


Hispanic spending is growing.


Hispanic entrepreneurship is on the rise.


Hispanics are one of the largest, fastest-growing, youngest and most financially untapped markets in the U.S.

• Hispanics account for almost half of U.S. population growth (54 million)

• More than half of the U.S. Hispanic population is under the age of 29

• Hispanics will account for over 80% of the growth in the U.S. millennial population over the next few years

• Hispanics spend nearly 10.5 hours per week using the internet on their smartphones, compared to the overall average of 8.4 hours

• Hispanic millennials are more likely to interact with brands on social media

• Hispanic consumer spending is growing ($1.4 trillion)

• Hispanics will account for 52% of new homeowners between 2010 and 2030

• Hispanic entrepreneurship is on the rise

• About half of the Hispanic market remains unbanked or underbanked

• Latinos are the most likely to live in a multi-generation household

Sources: “Six Facts About The Hispanic Market That May Surprise You,” Forbes, January 1, 2018;

“A New Hisanic Approach for Financial Services, Engage: Hispanics, January 26, 2017, 2015

State of Hispanic Homeownership Report, The Nielsen Company


Common Misconceptions


Reaching and serving the Hispanic market goes beyond translating your website.

Translating my website is all I need.


I can’t serve Hispanic immigrants.

Financial institutions can serve foreign nationals.


You can begin a strategy without bilingual/bicultural staff.

I need to have bilingual/bicultural staff at the credit union.


Hispanics need all new products and services.

The Hispanic market is looking for financial access and similar products and services as all members.


Do’s and Don’ts


Do’s

• Revisit your strategic growth plan

• Ask: Where does serving the Hispanic market fit with our strategic goals?

• Assess your market opportunity

• Make adjustments to your strategy

• Work with partners

• Explore the Juntos Avanzamos designation


• Designation developed by the Texas Credit Union League/Cornerstone Credit Union League

• More than 70 designated credit unions nationwide

• Participant CUs demonstrate they are welcoming to the Hispanic community

• An application process is required

• Consumers can access JA designated credit unions at juntosavanzamos.org

More information:http://www.cdcu.coop/initiatives/serving-underserved-markets/immigrants/juntos-avanzamos/

http://www.cdcu.coop/initiatives/serving-underserved-markets/immigrants/juntos-avanzamos/


Dont’s

• Do not start with your website

• Do not assume all Hispanic individuals are the same

• Do not perpetuate stereotypes in your marketing and communications

• Do not create barriers for account-opening

• Do not view this as a short-term project


Best Practices


National Hispanic Growth ROI Study (2014)

• 86 credit unions with Hispanic growth strategies over 3 years

• Examined loan growth, savings growth, membership growth, ROA, share draft growth, operating expense/average assets, delinquency rates

Results:

Loan Growth: Accelerated from 5.11% to 8.62%

Loan Delinquency: Increased 2 points from 1.50% to 1.52%

Membership Growth: Accelerated from 2.07% to 5.09%

Source: CUNA and Coopera ROI Study, 2014


Coopera Client Results

*Seventy-one percent of the Hispanic membership growth came from Spanish-preferring segment.

2017 study

Annualized Growth

RatesHispanic Non-Hispanic Factor

Membership 10.7% 1.7% 6.3

Checking Penetration 1.2% 1.0% 1.2

Loan Penetration 4.3% 2.2% 2.0

Number of Services per

Member1.5% 1.3% 1.2


Coopera Recommendations

Groundwork

Personnel

Products

Processes

Promotion/Marketing


Groundwork

• Conduct Local Demographic Focus Groups• Coordinate in-house

• Better understand local financial needs/demographic characteristics

• Use information to inform decision-making process


Personnel

• Provide staff training on business case & cultural differences of the Hispanic market• Create a personnel training strategy on topics such as:

• Why the Hispanic Market?

• Hispanic Cultural Nuances

• Common Misconceptions

• Communicate strategy to staff

• Create an onboarding training session for new staff

• Provide ongoing trainings and access to support materials


Processes

• Allow Flexibility in Customer Identification Program (CIP) to be inclusive of foreign nationals• Determine most common forms of non-U.S. ID in community

• Better understand forms of ID

• Modify CIP policy and procedures as needed

• Provide ongoing staff training on types of alternative forms of ID

• Adjust product documentation policies as needed


Products

• Package loans based on borrowing needs of Hispanic target segments• Examine credit-building loan for cultural relevancy

• Explore ITIN credit-building loan

• Package financial education with credit-building loan product

• Promote loan product in partnership with a community partner


Promotion/Marketing

• Develop a Hispanic marketing plan• Identify specific target segments

• Identify relevant branding elements

• Outline translation strategy

• Identify relevant community partnerships

UnderbankedBicultural Hispanic Professionals – Ages 25-35

UnderbankedHispanic Millenials –Ages 18-35

Unbanked Hispanic Immigrant Workforce – Ages 25-54


Questions?


Contact Informationwww.CooperaConsulting.com Miriam De Dios Woodward

[email protected] [email protected]

http://www.cooperaconsulting.com/

mailto:[email protected]

mailto:[email protected]

laying a foundation for success with the hispanic market€¦ · •hispanics will account for over...

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