Study: Black Buying Power Increased DramaticallyStudy: Black Buying Power Increased Dramatically
By: Denise Stewart, BlackAmericaWeb.com
The percentage of blacks in America is growing, and so is the amount of money blacks have available to spend on goods and services, according to a study released this week.
The "African-Americans Revealed" study, based on a BET survey of 80,000 black consumers over 18 months, showed a 10 percent increase in America’s black population between 2000 and 2008 and 55 percent increase in black buying power over the same period.
According to the survey, black buying power is estimated now at about $913 billion and is projected to increase to $1.2 trillion by 2013.
A similar study released in November by the Selig Center at the University of Georgia estimated that black buying power would be about $1.1 trillion by 2014, with current spending power for blacks at about $910 billion.
"'African-Americans Revealed' shows us that the black community should never be referred to as one homogeneous population," said Matthew Barnhill, senior vice president of corporate research at BET Networks. "We hope this report will help organizations better connect with an audience and intimately recognize all of its
complexities."
Boyce Watkins, a Syracuse University business professor, said he is not surprised by studies that show growth in black spending power.
Until the recession set in about a year and a half ago, blacks in America had been experiencing an upturn in wages and earnings, Watkins told BlackAmericaWeb.com.
“Unfortunately, when African-Americans make money, we spend it. We don’t use it to invest or produce,” Watkins told BlackAmericaweb.com. “When we get our tax refund, we go straight to the store.”
Blacks spend a large part of their disposable income - $39 billion – on computers, cell phones and other electronics, the survey showed. That’s about 31 percent of the available disposable income.
The survey also showed that blacks spend more time each week online than they do watching television.
According to the study, blacks spend about 18 hours each week online, compared with 15 hours watching television.
“African Americans Revealed” predicted there will be 42 million blacks in the United States, which would be a 13.4 percent increase over the 2000 Census. The total population growth for the nation in the upcoming Census is projected to be 9.8 percent.
Researchers at the University of Georgia who compiled the separate buying power study in November said the gains in black buying power reflect much more than just population growth and inflation.
“Of the many diverse supporting forces, one of the most important is the increasing number of blacks who are starting and expanding their own businesses,” Georgia researchers said.
The fact that blacks are getting more education and better access to higher salaries also is boosting buying power. The percentage of blacks who have completed high school or college increased has increased from 66.2 percent in 1990 to 83 percent in 2008, according to Census data cited in the report from the Selig Center.
In a statement on Marketwire.com, Don Montuori, publisher for a company that recently released a similar study on black buying power, predicted market outreach to African-Americans will increase as the buying power increases.
"Major consumer products marketers have begun to align their strategies with the multicultural majority emerging in the U.S.," Montuori said, "and some have even indicated that multicultural consumers have become their core focus as they strategize and set their sights on the next 10 years."
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