HOLIDAY HOT SHEET H I S P A N I C S H O P P E R S

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1 HOLIDAY HOT SHEET H I S PA N I C S H O P P E R S

2 2013 Holiday hot sheet: Insights for the holiday marketer As marketers seek to connect with their customers during the largest consumer spending season of the year, Experian Marketing Services presents our Holiday Hot Sheet series to provide a weekly recap of trends for the 2013 holiday season: How consumers are shopping, what they are searching for, and how marketing campaigns can be optimized to maximize rewards for both consumers and brands. This week, we re focusing on an increasingly influential consumer segment: the Hispanic shopper. The holiday season is a critical time for retailers and every dollar counts. Targeting Hispanic consumers can mean the difference between a good season and a great one. This week s Holiday Hot Sheet provides valuable insights that marketers can use to understand Hispanic consumers, where they shop, and how they use smartphones and social media to shop and connect with brands. What s hot this week: Hispanic households in 2013 will spend an estimated $183.8 billion on non-essential products and services, up from $164.2 billion in Hispanics control 15.6 percent of all discretionary spending in the West and 11.5 percent in the South. Hispanics shop online at higher than average rates and start their seasonal shopping earlier. Hispanic smartphone owners are twice as likely as non-hispanics to say that they are interested in receiving advertisements on their phone and 58 percent more likely to purchase products they see advertised on their phone. Hispanics access social media across multiple devices and are 30 percent more likely to say that they are likely to purchase products that they see advertised on social media properties.

3 Hispanics projected to spend $183.8 billion on non-essentials in 2013 Hispanic households in 2013 will spend an estimated $183.8 billion on non-essential products and services, up from $164.2 billion in 2012 and $143.9 billion in The total U.S. discretionary spend estimate (DSE) in 2013 is $1.8 trillion, meaning that Hispanic households control 10.2% of discretionary spending nationwide. However, region-by-region the story differs and marketers need to be aware of the differences to identify regions that require increased focus on the Hispanic market. In the West and South, for instance, Hispanic households control 15.6 percent and 11.5 percent of all discretionary spending, respectively. By comparison, Hispanic households control just 5.6 percent of DSE in the Midwest and 6.7 percent in the Northeast. Combined annual discretionary spend estimate, 2013 Geography Total DSE Hispanic DSE Hispanic share Total US $1.8 trillion $184 billion 10.2% West $406 billion $63 billion 15.6% South $661 billion $76 billion 11.5% Northeast $357 billion $24 billion 6.7% Midwest $371 billion $21 billion 5.6% Smartphones are an important shopping tool As Hispanic shoppers hit the stores this holiday season, smartphones are sure to play an important role. Hispanic adults are slightly more likely to own a smartphone than non-hispanics (56 percent versus 55 percent overall) and among smartphone owners, Hispanics are 16 percent more likely to access the Internet more through a mobile device than a computer. Given Hispanics openness and receptivity to mobile advertising, marketers should consider leveraging smartphones for campaigns targeting this group. Specifically, Hispanic smartphone owners are twice as likely as non-hispanics to say that they are interested in receiving advertisements on their phone and 58 percent more likely to purchase products they see advertised on their phone. Furthermore, Hispanics are 13 percent more likely than non- Hispanics to say that they often use their mobile phone to find local deals. This provides an opportunity for marketers to target Hispanics as they are in-market to make purchases through the smartphone and reach this group with mobile search and display ad investments. When it comes to shopping, 54 percent of Hispanic smartphone owners visit shopping sites from their mobile browser during a typical month compared to 50 percent of non-hispanic smartphone owners. Hispanics also spend more time browsing shopping sites from their phones than non-hispanics, spending 18.2 minutes per month on average visiting such sites versus an average of 16.7 minutes spent by non-hispanics. Interaction could increase offering mobile content both on websites and apps in Spanish to capture additional potential customers that

4 may prefer to shop in their first language. Regardless of language, optimizing the shopping experience for the smaller screen is always key to avoid frustrating the customer. Below are the top indexing shopping sites visited by Hispanic smartphone owners on their phone. Websites visited by Hispanics on smartphone during the last 30 days Mobile website Category Index vs. non- Hispanic Department stores 245 Department stores 187 Video and games 159 Department stores 153 Apparel and accessories 140 While Hispanic smartphone owners are more likely to visit mobile shopping websites, their use of shopping apps overall is only average. Specifically, 37 percent of Hispanic smartphone owners use a shopping app on their phone during a typical month compared with 38 percent of non-hispanic smartphone owners. Given their above average use of shopping sites, there s room for increased app usage among Hispanics. Providing more Spanish-language options or simply the development of apps from favored retailers could boost app usage among Hispanics. Shopping apps that Hispanics already use at rates exceeding their non-hispanic counterparts include: Shopping apps used by Hispanics on smartphone during the last 30 days Index vs. non- App Hispanic Walgreens 210 Ibotta 187 Amazon Mobile 142 Starbucks 122 ebay 112 Hispanics shop online more and earlier than average Hispanics show a propensity to shop online retail websites through a PC as well. During a 24 week period, the market share of visits to the Hitwise Retail 500 websites was 21 percent higher on average than the online population. As the holidays come closer, the gap is increasing as Hispanics ramp up shopping efforts earlier in the season with 33 percent more visits to retail

5 websites. Hispanics also had a higher tendency to visit the tech-oriented computers and electronics categories than the online population overall. 4.0 Market Share of Visits to Hitwise Retail % Share of Visits Jun-13 1-Jul-13 1-Aug-13 1-Sep-13 1-Oct-13 1-Nov-13 Hispanics Online Pop The top retail websites visited by Hispanics mirror the online population, Amazon.com, Walmart.com, and Target.com. However, when looking at the retail websites where there is a higher difference, brands such as Keurig, J. Crew, Coach, and Hollister emerge. Websites visited by Hispanics on a PC Website Category Index vs. Online Population Cooking.com House & garden 244 Frys.com Appliances and electronics 244 Keurig.com House & garden 237 Pepboys.com Automotive 219 Jcrew.com Apparel and accessories 215 Express.com Apparel and accessories 212 Blair.com Apparel and accessories 204 Christianbook.com Books 191 Coach.com Apparel and accessories 189 Hollisterco.com Apparel and accessories 184

6 Hispanics access social media across more devices and follow brands Retailers looking to reach and influence Hispanics this holiday season should also look to social media. While Hispanics are slightly less likely to use social media overall (80 percent use it versus 83 percent of non-hispanics), usage rates are still very high and Hispanics access social media from a wide range of devices, especially mobile ones. For instance, during a typical week, Hispanic social media users are more likely than non-hispanics to access social media properties via: a gaming console (index 121 vs. non-hispanics), an MP3 player (index 118), smartphone web browser (index 117 vs. non-hispanics), smartphone app (index 112), and digital tablet app (index 103, despite lower tablet ownership rates among Hispanics). Hispanic social media users are less likely than average to access social media through a PC either at work (index 84) or at home (index 80), so be sure your social campaigns targeting Hispanics are designed to work on a variety of platforms. In addition, Hispanic social media users access social media more frequently than non-hispanics. In fact, 69 percent access social media at least once a day compared to 62 percent of non-hispanics. Hispanic social media users are also six percent more likely than non-hispanics to follow companies and brands on social media and 30 percent more likely to say that they are likely to purchase products that they see advertised on social media properties. Social media properties with the highest share of Hispanic consumers are below. Social media properties, by platform with highest share of Hispanic users Property Platform Index vs. non- Hispanic Google+ app Tablet 299 Home PC 197 Tumblr app Smartphone 182 Home PC 179 Smartphone 167 Stay up-to-date on the latest holiday trends For weekly insights into what products consumers are searching for overall and which retailers are garnering the greatest share of online traffic, visit our Hot Holiday Products and Trends page. Bookmark the page and come back every Tuesday for fresh insights.

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