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Telecom and Ethnic Groups: Uses of Local, Long Distance, and Wireless Services in Ethnic Communities
2000-2005
a market research report
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Ethnic consumers are becoming a major force in the telecom market. Insight predicts that by 2005 they will spend over $65 billion dollars on local, long distance, ISP, and wireless services––approximately half of the current expenditures for all US consumers. While telecom spending for the general population is expected to grow at a compound annual growth rate of approximately 10 percent, Hispanics and Asians show a much faster growth over the same time period.
The growing importance of the ethnic market’s telecom expenditures should make even the largest telecom provider stand up and take notice. In comparison to the general population, ethnic telecom consumers are purchasing more enhanced features, such as voice mail, caller ID, and call waiting. This translates to higher profits for carriers. Insight’s research, however, has shown that ethnic consumers tend to switch carriers more often than the rest of the population. Obviously, a one-size-fits-all service package or marketing campaign will not equal success in the ethnic marketplace. In-language, in-culture marketing, billing, and customer care is essential.
Telecom and Ethnic Groups helps carriers to understand the right combination of services and messages that will interest Asian, Hispanic, and African-American consumers. Insight’s primary survey of over 1,100 households, combined with US Census demographics, telecom service forecasts, and secondary research, defines the ethnic telecom consumer marketplace. This report is a must read for carriers who want to attract and retain the ethnic consumer. Find out who is marketing to ethnic groups, what ethnic consumers are spending on telecom services, and how to plan a successful ethnic campaign.
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Report Excerpt
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A Growing Ethnic Population with Greater Purchasing Power
The ethnic market looks even better today than it did two years ago when Insight published Telecom Marketing Opportunities to Ethnic Groups. Ethnic communities continue to grow faster than the general population, and with the larger numbers come increasing spending power. In 1999, the annual purchasing power for African-Americans, Hispanics and Asians totaled approximately a trillion dollars. The buying power of the Hispanic market alone is expected to reach over $450 billion by 2001 and, `will energize the US consumer market as never before,` according to the Selig Center for Economic Growth at the University of Georgia.
Insight`s research suggests that ethnic consumers will become a major force in the telecom market over the forecast period. Our analysis predicts that by 2005 they will spend over $65 billion dollars in local, long distance, ISP, and wireless services which is approximately half of the current expenditures for all US consumers. While telecom spending for the general population is expected to grow at a compound annual growth rate (CAGR) of approximately 10 percent, Hispanics and Asians show a much faster growth over the same time period. The growing importance of the ethnic market’s telecom expenditures should beckon even the largest telecom providers.
Ethnic Consumers Purchase More Telecom Products and Services
Insight commissioned a consumer telecom usage study which was conducted by Bruskin Audits & Surveys Worldwide. The objective of the study was to solicit feedback on consumers` telecommunications usage and behavior among a random sample of the US population, as well as among a quota sample of ethnic groups. The study used a random digit dialing probability sample of all telephone households in the continental US. Additional random digital dialing quota sampling was conducted in order to bring the three ethnic groups of Asians, African-Americans, and Hispanics up to a minimum of 100 respondents for each ethnic group.
Regarding telecom usage, the study showed that the ethnic telecom consumer spends more on almost every telecom service, owns more products and services, and plans to purchase more than the random sample. For example, a sampling of the survey results shows:
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Asians spend more than any other group in both long distance and international calls and are much more likely than Caucasians and the other ethnic groups to be online.
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African-Americans and Hispanics spend much more of their telecom dollars than any other group on local calls.
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Ethnic consumers purchase more service features than the random sample. For example, both Hispanics and African-Americans were significantly higher than the random sample average of having at least one service feature. And African-Americans have more of those features than any other group.
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Market Segmentation
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Total Consumer Telecom Expenditures
Local
Long Distance
ISP
Residential Wireless
Total Ethnic Residential Wireline and Wireless Telecom Expenditures
African-American
Hispanic
Asian
Native-America, Eskimo, Aleutian
US Consumer Telecom Spending by Ethnic Group
African-American
Hispanic
Asian
Native-American, Eskimo, Aleutian
Ethnic Market Share of Consumer Telecom Market
Ethnic Consumer Telecom Expenditures
Non-ethnic Consumer Telecom Expenditures
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Table of Contents
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Chapter I
EXECUTIVE SUMMARY
1.1 A Growing Ethnic Population with Greater Purchasing Power
1.2 Ethnic Consumers Purchase More Telecom Products and Services
1.3 Another Look at the Digital Divide
Chapter II
CURRENT MARKET ANALYSIS AND TRENDS
2.1 Defining the Market
2.2 Market Size and Location
2.2.1 Increase in Asian and Hispanic Population
2.2.1.1 Higher Birth Rate Among Hispanic Women
2.2.1.2 More Foreign-Born Residents
2.2.2 Geographic Trends
2.3 Income and Education Characteristics
2.4 Age and Family Characteristics
2.4.1 Ethnic Population is Younger
2.4.2 Asians Have Lower Divorce Rate
2.5 Understanding Cultural Differences
2.6 Specialized Marketing Strategies
2.6.1 In-Language
2.6.2 In-Culture
2.7 Updating the Digital Divide
Chapter III
UNDERSTANDING THE MARKET THROUGH SURVEY RESULTS
3.1 Objective of Consumer Study
3.2 Survey Methodology
3.3 Findings and Analysis
3.3.1 Switching Behaviors and Reasons
3.3.2 Telephone Service Expenditures
3.3.2.1 Long Distance
3.3.2.2 International Long Distance
3.3.2.3 Local
3.3.3 Local versus Long Distance Company Preference
3.3.4 Telephone Service Feature Usage
3.3.5 Work-At-Home Phenomenon
3.3.6 General Interest in Current Technologies
3.3.7 Demographics of Survey
3.4 Summary of Findings
Chapter IV
STRATEGIES IN ETHNIC MARKETING
4.1 Exploring New Opportunities
4.2 Long Distance Company Case Studies
4.2.1 AT&T Corporation
4.2.2 MCI WorldCom and Sprint
4.2.3 Other Companies and Organizations
4.3 Local Carriers
4.3.1 BellSouth, Qwest, and Verizon (GTE/Bell Atlantic)
4.3.2 SBC
4.4 Cellular Carrier Programs
4.5 Prepaid and Phone Card Offerings
4.6 Related Service Industry Case Studies
4.7 Award Winning Ethnic Advertising
Chapter V
FORECAST AND RECOMMENDATIONS
5.1 Definitions
5.2 Ethnic Population and Their Purchasing Power Keep Growing
5.3 Total Telecom Market Continues to Climb
5.3.1 Ethnic Telecom Market
5.3.2 Targeting Smaller but More Affluent Markets
5.4 Ethnic Marketing versus General Marketing Strategies
5.5 Future Trends Point to Greater Ethnic Pride
TABLE OF FIGURES
Chapter I
I-1 Ethnic Market Share of Total Consumer Telecom Market, 2000-2005 ($Billions)
Chapter II
II-1 States with Largest Number of Foreign-Born Residents, 1995 (Millions)
II-2 States with Largest Increase in Foreign-Born Residents between 1995 and 1999
II-3 Real Median US Household Income, 1999
II-4 Educational Attainment of Total Population Age 25 Years and Over, by Race/Ethnicity, 1999
II-5 AT&T’s Lucky Dog Campaign Adapted to Hispanic and Asian Markets, 1998
II-6 US Households with Internet Access by Race/Ethnic Origin, 1998 & 2000
II-7 US Households with Internet Access by Income, By Race/Ethnicity, 2000
II-8 US Internet Use by Location and Race/Ethnicity, 2000
Chapter III
III-1 Company You Would Prefer for Both Long Distance and Local Telephone Service
III-2 Survey Respondents That Have These Features, 2000
III-3 Survey Respondents Who Own Technologies, 2000
III-4 Survey Respondents Who Plan to Buy Technologies, 2000
Chapter IV
IV-1 AT&T Prepaid Advantage Brochure in Spanish
IV-2 The Verizon Family SharePlan and SingleRate Wireless Sales Pamphlets, 2000
IV-3 Verizon’s SingleRate East Wireless Plan Sales Pamphlet, 2000
IV-4 Different Prepaid Long Distance Cards from Blackstone, 2000
Chapter V
V-1 Total Consumer Telecom Expenditures, 2000-2005, ($Billions)
V-2 Total Consumer Telecom Expenditures for Local, Long Distance, and ISP, 2000-2005 ($Billions)
V-3 Ethnic Market Share of Consumer Telecom Market, 2000-2005 ($Billions)
V-4 US Consumer Telecom Spending by Ethnic Group, 2000-2005 ($Billions)
TABLE OF TABLES
Chapter II
II-1 Total US Residents, 1990-2050 (Thousands)
II-2 Percentage of Total Population by Ethnic Group, 1995 to 2025
II-3 US Population Growth by Ethnicity, 2000 and 2005 (Thousands)
II-4 US Population by Ethnicity, 2000 to 2005 (Thousands)
II-5 US Cities with Large Hispanic Populations, 1999
II-6 Educational Attainment of Total Population Age 25 Years and Over, by Race/Ethnicity, 1999
II-7 Percentage of Hispanics Speaking Spanish Most Frequently at Different Locations
II-8 US Households with a Computer, 1998 & 2000
II-9 US Households with Internet Access, 1998 & 2000
II-10 US Households with Internet Access by Income, By Race/Ethnic Origin, 2000
II-11 US Internet Use by Location and Race/Ethnicity, 2000
II-12 Most Frequently Reported Site Outside the Home for Internet Access, 2000
Chapter III
III-1 Reason Survey Respondents Would Pick Long Distance or Local Service Provider for All Telecom Services, 2000
III-2 Reason African-Americans, Asians, and Hispanics Would Pick Either Long Distance or Local Telco to Provide All Services, by Which Company Chosen, 2000
III-3 Survey Respondents That Have These Features, 2000
III-4 Survey Respondents Who Plan to Buy Telephone Features, 2000
III-5 Survey Respondents Working from Home, 2000
Chapter V
V-1 Total Consumer Telecom Expenditures, 2000-2005 ($Billions)
V-2 Total Ethnic Residential Wireline and Wireless Telecom Expenditures, 2000-2005 ($Billions)
V-3 Total African-American Residential Wireline and Wireless Telecom Expenditures, 2000-2005 ($Billions)
V-4 Total Hispanic Residential Wireline and Wireless Telecom Expenditures, 2000-2005, ($Billions)
V-5 Total Asian Residential Wireline and Wireless Telecom Expenditures, 2000-2005, ($Billions)
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Pricing Information
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Hard Copy Price
$ 799
Electronic Copy Price
(PDF
License Descriptions)
$ 939 Single-User Printable PDF
$ 1399 6-Seat Printable PDF
$ 2000 Unlimited Corporate-Wide Distribution
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Telecom
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