14% of Americans Are Black. 3% of Major Media Ad Spending is Focused on Them.

Nielsen-Change-Ad-Spend-Media-Focused-Black-Audiences-Sept2013The Black or African-American population numbered 44.5 million as of July 2012, per recent Census Bureau estimates, translating to roughly 14% of the US population. A new study [download page] from Nielsen finds that despite African-Americans being the largest racial minority in the US (Hispanics are an ethnic minority), advertisers allocated just 3% of the $75 billion they spent last year on TV, magazines, the internet and radio to media focused on Black audiences. In fact, ad spending targeted to Black audiences fell on a year-over-year basis across network TV, national magazines, internet, and spot radio, increasing only on syndicated and cable TV.

Were advertisers to match black Americans’ consumption patterns, they should be spending 44% more on education and career websites, 38% more on streaming websites, 37% more on TV (with special attention paid to cable), and 15% more on mobile ads, per the study.

The researchers believe that ad spending on Black audiences is lagging because “companies mistakenly believe [that] because there are no language barriers that a general market ‘one-size-fits-all’ strategy is an effective way to reach African-Americans.” Instead, Nielsen says, connecting with African-Americans requires understanding the cultural nuances that resonate with them.

It likely requires a deeper knowledge of this demographic as a whole, too. According to Nielsen’s data, the black population skews younger than the total market, with 53% of African-Americans aged under 35, compared to 47% of the US population on average. Women prove particularly influential in the African-American population: they represent 54% of the adult black population; they also are the heads of 29% of black American households, compared to 20% for the total US market; and they control 43% of Blacks’ annual spending power.

That spending power appears to be growing. While the number of African-American households has increased by 20% since 2000, the aggregate income of African-Americans has increased by 45% over the same timespan. (It’s unclear whether or not that growth has been adjusted for inflation, or how it compares to income growth among the general market.) Still, median incomes for Black households are significantly below the US median ($47,300 vs. $67,300), although the biggest differences are on the extremes (with a smaller proportion of Black households in the $100k+ group and a larger share in the <$25k bracket).

Despite having a significantly smaller annual household income, African-Americans’ annual retail spending is only 13% less than the total US market ($5,954 vs. $6,826), as they allocate 13% of their household income to retail spending, compared to 10% for the population overall.

For advertisers focusing on Black audiences on a geographic basis, the South may prove a useful starting point. A majority 55% of Blacks live in the South, per the report, and the Black population is actually reverse migrating from northern and eastern cities to the South. Southern cities such as Jackson, MS (49.5%), Memphis, TN (43.6%), Columbia, SC (39.1%) and Atlanta, GA (31.5%) have particularly high densities of Black Americans.

Other Findings:

  • Black Americans watch 37% more TV than any other group.
  • Blacks are 44% more likely than the average consumer to have a social media account. Interestingly, on average, 45-64-year-olds spend more time on Facebook than any other age group.
  • 7 in 10 Blacks own a smartphone.
  • Among mobile applications, Blacks spend the most time per person on Instagram (7 hours and 21 minutes per month), with Facebook next.
  • The top categories for media spending focused on Black audiences in Q1 were: restaurants/quick-service ($24.2 million); automotive ($21.7 million); and motion pictures ($20.3 million).