CBx Daily

Value-Based Cultural Currency Leads To Better Business With Black Consumers $1.6 Trillion Spending Power

By Gary J. Nix - Nearly 22% of Black consumers say a brand’s values are important in purchasing decisions - Black spending power reached a record $1.6T in 2021 The concept of consumerism is often invoked in its negative connotation. However, when we discuss consumerism here today, we will refer to the act of protecting or promoting the interests of consumers. Why? Because businesses need to understand that Black consumers are more likely than others to base purchase decisions on a brand’s values, the values of its corporate parent, or the brand’s commitment to diversity and social justice.

April 25, 2022

By Gary J. Nix

  • Nearly 22% of Black consumers say a brand’s values are important in purchasing decisions
  • Black spending power reached a record $1.6T in 2021

The concept of consumerism is often invoked in its negative connotation. However, when we discuss consumerism here today, we will refer to the act of protecting or promoting the interests of consumers. Why? Because businesses need to understand that Black consumers are more likely than others to base purchase decisions on a brand’s values, the values of its corporate parent, or the brand’s commitment to diversity and social justice.

Why This Matters: We still live in a world where many businesses that target Black consumers fall flat on their speculative goals by not listening to the market. Empty platitudes and short-lived announced plans have proven insufficient to convince Black consumers of businesses’ commitment to this community. As a matter of fact, valuable recommendations such as authenticity and meaningful representation have been co-opted, parroted, and misused to the point of buzzword status by many entities purported to want a closer connection with Black consumers.

Yet, data from Numerator proves things that many of us should have already known, at least anecdotally:

  • 21.9% of Black consumers say a brand’s values are important in purchase decisions;
  • 38.1% of Black consumers are extremely or very aware of the corporate values behind the products they purchase; and
  • 31.1% of Black consumers find a brand’s commitment to diversity, equality & social justice important when choosing a product or service.

Companies have recently invested their money in ads featuring diverse talent and in diverse media channels. For example, AT&T (T +4.35%) and Amazon (AMZN -2.24%) have spent $145 and $139 million, respectively on diverse ads. Geico & Amazon have spent $1.3 billion and $780 million on Black media. Now, we have to see how, and if these companies continue to invest in this community after not doing so for a long time.

Situational Awareness: Finally, more credence is being given to the principle of cultural currency. While conversations about the growing buying power of Black consumers—estimated to be $1.7 trillion in 2030, the discourse must evolve. For instance, when we refer to Black media, are we referring to Black-targeted or Black-owned media? Furthermore, as important as dialogue is regarding buying power, the way the trillions of dollars from Black consumers influence everything else gives even more credibility to the need for brands’ values to match those of the people they want to buy from them.

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