What drives black consumer spending? Nielsen thinks it knows
Special to the Trice Edney News Wire from Nielsen | 1/2/2020, 6 a.m.
African-American consumers want more for themselves and from corporate America, and they express it with their dollars as they move through the consumer journey from brand awareness to purchase, according to Nielsen’s 2019 Diverse Intelligence Series Report on African-Americans.
“It’s in the Bag: Black Consumers’ Path to Purchase” explores the non-linear and uniquely technologically driven road that African-Americans follow to make purchasing decisions, which ultimately maximizes both online and in-person shopping options.
This path highlights several differences in shopping behavior and purchasing when compared to the total U.S. population, according to the report.
The report also includes deeper insights into how culture, socioeconomics and business influences how, why and what motivates African-American spending in a special co-authored section by advocate and media commentator Angela Rye, chief executive officer and principal of Impact Strategies.
“At 47.8 million strong and a buying power that’s on par with many countries’ gross domestic products, African-Americans continue to outpace spending nationally,” said Cheryl Grace, Nielsen’s senior vice president of community alliances and consumer engagement and co-creator of the report.
“This year, we wanted to help brands and marketers understand the multi-faceted process that blacks take to buy the products they buy. There are several drivers, but culture is at the center of them all.
“Further, with their love for technology, they are much more savvy and conscious consumers. They are as we say, ‘woke.’ They pay attention to how companies are speaking to them. As they spend more, they want more for themselves and from the brands they support.”
Key takeaways from the report include:
• African-Americans are welcoming recipients of advertising across all channels. However, while the trends of the black buying power and over-indexing in spending continue to increase, companies’ investments to advertise to them have decreased.
• African-Americans are more likely than the total population to agree that advertising provides meaningful information on most platforms.
• Advertising spending designed to reach black consumers declined 5 percent between 2017 and 2018.
• Physical appearance reflects a sense of cultural pride and self-expression in the black community. This is evidenced by the top spending priorities for African-Americans from everyday soap to luxury handbags.
• African-Americans outspend the total market on personal soap and bath needs by nearly 19 percent ($573.6 million).
• Men are making an impact with grooming habits, outpacing the total market by 20 percent on toiletry items.
• African-Americans are 20 percent more likely than the total population to say they will “pay extra for a product that is consistent with the image I want to convey.”
• They are also more likely to say they shop at high-end stores, including Saks Fifth Avenue 63 percent), Neiman Marcus (45 percent) and Bloomingdales (24 percent).
While online shopping grows, African-Americans continue to head to physical stores for the personal touch and feel experience — but with more discerning eyes.
• More than half (52 percent) of African-Americans find in-store shopping relaxing, compared with 26 percent of the total population.
• Fifty-five percent of black consumers say they enjoy wandering the store looking for new, interesting products.