Strategic Marketing Strategy for Whites: Book Report

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Trends in Black Purchasing Power of Generation X

Purchasing power for Blacks both alone and in combination with other ethnicities (AOIC) increased faster than all races from 2005-2007, but started to lose that growth rate over 2007-08. The consumers who identified as polyethnic increased earnings faster at first but those slowed to even more sharply negative at the end of our period.

all races white alone blackAlone

Black AOIC

Asian Alone

Hispanic

2005

25,036

26,496

16,874

16,629

27,331

14,483

2006

26,352

27,821

17,902

17,564

30,474

15,421

2007

26,804

28,325

18,428

18,107

29,901

15,603

2008

26,964

28,502

18,406

18,054

30,292

15,674

2005-06

5.26%

5.00%

6.09%

5.62%

11.50%

6.48%

2006-07

1.72%

1.81%

2.94%

3.09%

-1.88%

1.18%

2007-08

0.60%

0.62%

-0.12%

-0.29%

1.31%

0.46%

Most Profitable Product to Offer to Black Generation X

With a smaller share of total population and smaller per-unit incomes, the Black consumer group ranks third in our aggregate spending comparison, but they consume largely the same major purchase fields as all other consumers, particularly Housing, transportation and food, although they spend different shares of their incomes on these purchases than the other sectors. These are the "Big spender" categories for all ethnicities and origins, but we see for example, that Blacks spend much less of their income on food away from home for example, so targeting restaurant purchases to that segment instead of any other, would be a mistake.

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Rental real estate, for another example, consumes a far larger share of Generation X Black incomes relative to owned shelter than it does for Hispanics, and double the share compared to owned homes for Whites. Targeting marketing for rental dwellings may have more return per capita for Blacks than for Whites, although the dominance of the aggregate size of the White expenditure for everything would make them the primary target if we measured return on a fixed advertising budget in overall dollar return on investment. Even though Blacks spend more of their income on rent than whites do, Whites still spend more in total at the bottom line.

Black

Propensy

Index

Avg

In-Group

Average annual expenditures (dollars)

36,721

..Housing

13,770

37.50%

37.50

....Shelter

7,985

21.75%

21.75

..Transportation

6,520

17.76%

17.76

..Food

4,594

12.51%

12.51

Owned dwellings

3,940

10.73%

10.73

Rented dwellings

3,762

10.24%

10.24

....Food at home

2,825

7.69%

7.69

Mortgage interest and charges

2,463

6.71%

6.71

....Gasoline and motor oil

2,257

6.15%

6.15

....Other vehicle expenses

2,033

5.54%

5.54

..Apparel and services

1,983

5.40%

5.40

....Vehicle purchases (net outlay)

1,969

5.36%

5.36

....Food away from home

1,768

4.81%

4.81

Asian Generation X

U.S. Asian Generation X.....

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Strategic Marketing Strategy for Whites: Book Report

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