NEW YORK (AdAge.com) -- U.S. Hispanic consumers are more optimistic about their financial future than non-Latinos, but the recession is sharply eroding Hispanics' traditional brand loyalty and fondness for advertising.
Just 31% of Hispanics surveyed this year said that "Advertisements help me decide what to buy," a 16% drop from the number of respondents who agreed with that statement a year ago, according to a report Forrester Research is releasing today.
"The economic times are forcing consumers to be more careful about how they're spending their money," said Tamara Barber, a Forrester data analyst. "This is a consumer that is finally becoming jaded, and relying more on recommendations from friends and family as much as advertising.
'Feeling the pinch'
Only half as many non-Hispanic consumers -- 15% -- agreed that ads help them decide on purchases, but that figure was unchanged from a year ago. The survey of 3,004 Hispanic adults, conducted in the first quarter of 2009, also found that 61% of respondents agreed with the statement "When I find a brand I like, I stick to it," down from 67% last year.
"Everybody is feeling the pinch and they're more willing to trade down to private label brands or value brands," Ms. Barber said.
At the same time, Hispanics are more optimistic consumers. Asked how their personal financial situation has changed over the past 12 months, 50% of Hispanics surveyed said their finances have worsened, 34% said they're about the same, and 15% said they've improved. Non-Hispanic consumers' responses were about the same.
But asked what they expect will happen to their finances in the next 12 months, 44% of Hispanics said they expect their personal financial situation to improve, compared to just 20% of non-Hispanics. And just 21% of Hispanics thought their finances would worsen, while 35% of non-Hispanics expected a downturn.
Ms. Barber said that partly reflects the experience of immigrants from Latin America, where economies sometimes fluctuate wildly.
Open to brand switching
"They've kind of been through this before," she said.
The lessons for marketers are that Hispanics may not be as swayed by advertising and brand loyalty as in better economic times, but may be more open to value-based advertising and switching to less expensive brands, she said.
And when the economy begins to improve, Hispanics may be the first to start spending again because they're less likely to have a mortgage or be heavy users of credit cards.
"They're not saddled with as much debt," she said.