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Black spending power projected to reach $1.1 trillion

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Black spending power projected to reach $1.1 trillion
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Joined15 Jul 2007
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Post Black spending power projected to reach $1.1 trillion Reply with quote
Black spending power projected to reach $1.1 trillion

by Shartia Brantley | July 12, 2013 at 9:38 AM

lack consumers are wielding power and influence in the marketplace like never before. All while spending their way to a major milestone.

The Nielsen Company, a global information and research firm, projects black spending power will reach $1.1 trillion by 2015. Despite this looming thirteen-figure impact, many black consumers do not understand the full extent of their power says Cheryl Pearson-McNeil, senior vice president of public affairs at Nielsen.

“Do I think we’re interested in learning more about it? Absolutely.”

Some companies struggle to tap the real power of black consumers. The lack of understanding cultural nuances of African-Americans, Asian-Americans and Latino Americans results in a general market advertising approach Pearson-McNeil explains. “The African-American community isn’t a monolithic group.”

In 2011 advertising targeting black consumers across television, radio and magazines reached $2.1 billion, according to Nielsen. This was a modest increase from the year before and was just 2 percent of the $120 billion spent on advertising that year.

Headwinds such as high unemployment among blacks may not have an adverse impact on spending power. The national unemployment rate is 7.6 percent while black unemployment stands at 13.7 percent. African-American unemployment has historically been higher than the national rate since tracking began.

“Blacks are still spending whether employment is there or not,” says Pearson-McNeil.

Where you wield your power counts

As incomes continue to rise in black households, consumer packaged goods companies are taking note and adapting to a savvier and more vocal consumer. Total aggregate Black household income totaled $696 billion in 2012.

Vera Moore founded her eponymous company Vera Moore Cosmetics thirty-three years ago and also serves as president and CEO. She says manufacturers are focusing on providing more ethnic-focused products for consumers who are more aware of their spending power.

This increased awareness stems from higher self-esteem and more education Moore explains. “They know the power of the dollar.” She says black consumers are more supportive of black retailers and products now than in the past due to better quality products. “Often times we spend the money and it doesn’t come back to the community.”

Social media influences spending

“Black consumers are learning more and more everyday about their spending power,” says Richelieu Dennis, chief experience officer at Sundial Brands which makes SheaMoisture and Nubian Heritage hair and skin care products.

Social media has become a major driver of how and where consumers decide to spend their money.

“Social media is the great equalizer,” Pearson-McNeil says. The increased use of smartphones by blacks is driving influence. The ownership rate of smartphones grew from 33 percent in 2011 to 54 percent in 2012 for blacks, according to the Nielsen study. Increased smartphone ownership is directly related to higher Twitter usage among this group.

“It goes back to connecting with people that look like you,” Pearson-McNeil says.

Dennis has witnessed the power of social media first hand. He says black women are heavy users of social media which has given them a vehicle to exchange ideas and solutions. “The internet not only liberated them from the lack of information, but gave them access to brands that speak to them.”

“Social media has been the cornerstone for growing our business,” Moore says.

Social media is the new word of mouth for harnessing Black spending power and influence.

Shartia Brantley is a producer and on-air reporter at CNBC. Follow Shartia on Twitter at @shartiabrantley
Wed Jul 24, 2013 8:16 am View user's profile Find all posts by shadow777 Send private message Send e-mail

Joined15 Jul 2007
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Post Reply with quote
Mike Brown · Top Commenter · Obama for America
We can buy sneakers, etc.. but can't seem to figure out how to move forward?
Reply · 8 ·
· July 12 at 7:38am

Joseph Coleman · North Carolina Central University
How many times are we going to post these kinds of stories? I'm a firm believer that until our race adopts a sense of "entitilement" as many other races have, we will continue to see $1.1 trillion dollar spending while being part of the low-middle class or worse.
Reply · 3 ·
· July 12 at 7:41am
LaRon Stewart · Greenville, South Carolina
I'd think that the entitlement mentality of many people is the main problem.
Reply · 2 ·
· July 12 at 7:51am
Kent Swift · New York, New York
We must become Capitalist if we are to solve our inner Cities BLUES - How many black leaders tried to help Dave Bing rebuild Detroit or any other City or State etc.? We are divided North, South, East & West. - Garvey, Malcolm & Martin plus all the strong woman/men since the turn of the Century (1900) would be shocked with the freedom we have and the lack of progress as a people (black on black crime, waste of brain POWER, can't control our resources in Africa or America etc. peace!
Reply · 1 ·
· July 15 at 1:35pm

Phil's Register Vote · Lawrence Technological University
WOW! $1.1 Trillion. That is a lot of buying power. What if one day, AA did not purchase anything? No ATM/credit card transactions, no banking, no gasoline, food, bus/train rides, movies/sports tickets purchases, etc. Not--a-thing. What if a " One Day-of-Saving". I wonder what would happen? What would happen to this economy? Uhmmmm!
Reply · 2 ·
· July 16 at 4:56pm

Li Squidbatten · Clinical Pharmacist Informaticist at Hospital, New York
Great Idea! but you have to look at that specific group that has to have the newest phone, the latest sneakers, the latest designer wear. that would mean we would have to exercise delayed gratification and self control.
Reply · 1 ·
· July 17 at 8:25am
Jacque Bell · Top Commenter
Oh my I just had this conversation with my sons before I read this article which by the way is almost 2 weeks old. I told them we could bring them to their knees and maybe then they would take us seriously. But then I have to agree with Li Squidbatten as well we have a specific group that we would have to hope would exercise if nothing else self-control and it's not just the young either...
Reply ·
· 15 hours ago

Marcus Armstrong · Top Commenter
We spent all money and still don't own nothing because we are out for self.
Reply · 2 ·
· July 12 at 8:06am

lakerfan4life01 (signed in using yahoo)
Which is why boycotting those corporation which were a part of ALEC will send a strong message. Either these corporations lead the charge to repeal Stand Your Ground, or Black America should take their dollars else where.
Reply ·
· July 20 at 7:35am

Viva Habbit Van Assen · Top Commenter
hold on to your money and don't give it away so easy If we want justice we need to hit them in the pocket if you can keep it in your own people stop giving them every dime you got. Time to support one and other. Remember they love your money but hate your black face.
Reply ·
· July 15 at 10:56am

Ryan Craig Hughes
I never comment on issues with race because no matter what it's going to always be someone else's fault but our own. Yes racism play's a part but it;s not kkk it's black. It's drug and alcohol. It's unplanned pregnancies and a lack of male and female role models. When we learn to put God first( no cliche') and speak truth to ourselves and our people then we will see our way out. The enemy comes to steal, kill and now destroy.
Reply ·
· July 13 at 8:41pm

Pitch Black· Top Commenter (signed in using Hotmail)
"DAYS OF ABSENCE"... Douglas Turner Ward!
Reply ·
· July 19 at 7:49am

Anthony Reese
Wonder why I can't seem to easily share the link......hmmmm.
Reply ·
· July 14 at 8:52am

Frank Rivera · University at Buffalo, The State University of New York
Black spending? I bet most of that is welfare and food stamps!
Reply ·
· July 18 at 7:32pm

Michael D. Abernathy
Well Frank in my neighborhood most if the people using food stamp ebt cards are white, who would have thought it. Your stereotype does not ring true. Maybecyou should get iut of the house more. Statistically there are more whites on welfare than blacks, true blacks are disportionately represented based on populational representation in the general population on the welfare roles
Reply ·
· July 19 at 4:04pm
Wed Jul 24, 2013 8:20 am View user's profile Find all posts by shadow777 Send private message Send e-mail
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