Geoscape multicultural overview by Arthur Rockwell at Versailles Breakfast Club

1. TheVersailles Breakfast Club
Accessing the New
Mainstream
Capitalizing on a Culturally Diverse America
Arthur Rockwell, Vice President, Sales
Geoscape
Friday, June 5, 2009
Access the New Mainstream

2. Agenda
• The New Mainstream
• America‟s Secret Weapon
• Lifetime Profit Margin Contribution
• “The Long Tail”
• AMDS 2009 Demographic Data
• Who is Geoscape?
• Q&A
2 © Copyright Geoscape, www.geoscape.com, 1 (888) 211-9353.

3. New American Reality
The face of America…is Multicultural!

4. Mainstream America
• A new reality and wake-up call
– What it means to be American has changed
• Culturally and psychologically we are a diverse nation
• This will continue to evolve towards increasing diversity
• Many corporations still marginalize marketing to diverse cultural
segments
– Yet cultural segments represent fast growing opportunities
• Business is still looking for ways to better-serve and capitalize on this
trend

5. From 2000 to 2009…
• Nearly 13.4 million additional Hispanics
– 38% growth during period
– 51% of the total population growth
• More than 4.1 million non-Hispanic blacks
– 12% growth during period
– 16% of the total population growth
• Over 3.7 million more Non-Hispanic Asian-Pacific Islanders
– 36% growth during period
– 14% of the total population growth
• 26 million more people overall
– Nearly 21.3 million persons and 82% of growth from these 3 minority
segments
Source: Geoscape; American Marketscape DataStream: 2009 Series; Estimates as of July 1 2009.
Copyright© Geoscape®, www.geoscape.com, 1 (888) 211-9353. Page 5

6. Household Income in 2009 by Culture Group
“Asians top the list in terms of annual household income, due in part to both the disproportionately
large number in working age cohorts and to their higher levels of educational attainment.
Hispanics are about 17 percent below the overall median.”
Median Household Income
$80,000
$70,000 $69,654
$60,000 $55,880
$53,214
$50,000
$44,073
$40,000 $35,843
$30,000
$20,000
$10,000
$-
Asian Black White Hispanic Total
HHs Median HH Income Mean HH Income Aggregate HH Income Aggregate Income
Total 118,293,887 $ 53,214 $ 66,338 $ 7,847,322,306,519 $ 8,080,469,566,868
White 97,617,470 $ 55,880 $ 68,468 $ 6,683,637,940,846 $ 6,845,430,654,775
Black 14,362,997 $ 35,843 $ 47,373 $ 680,412,381,876 $ 716,056,511,124
Asian & Pacific Islander 4,324,691 $ 69,654 $ 79,678 $ 344,581,718,498 $ 367,316,430,437
Hispanic 12,987,859 $ 44,073 $ 55,217 $ 717,155,262,027 $ 758,800,826,112
Copyright© Geoscape®, www.geoscape.com, 1 (888) 211-9353. Source: Geoscape, American Marketscape DataStream: 2009 Series. Page 6

7. Hispanic Income by Ranges: 2009
“Over 37% of Hispanic households earn over $50,000 per year and 69% earn over $25,000 per year.”
$150,000 or more
$100,000 to $149,999 3.3% less than $15,000
6.5% 16.0%
$75,000 to $99,999
9.1%
$15,000 to $24,999
15.1%
$50,000 to $74,999
18.3%
$25,000 to $34,999
$35,000 to $49,999 13.9%
17.7%
Source: Geoscape, American Marketscape DataStream: 2009 Series.
Copyright© Geoscape®, www.geoscape.com, 1 (888) 211-9353. Page 7

8. Hispanic Consumer Expenditures: 2009
“Hispanic spending is quite substantial in all major categories, especially due to their relative
youth and larger average household size.”
160,000,000,000
140,000,000,000
120,000,000,000
100,000,000,000
80,000,000,000
60,000,000,000
40,000,000,000
20,000,000,000
-
Food & Shelter & Utilities Housekeeping Furnishings Apparel Transportation Health Care Entertainment Personal Care Personal
Beverages Insurance supplies And & Insurance Products & Insurance &
Equipment Services Pensions
Annual Expenditures Per Household in USD
Source: Geoscape, American Marketscape DataStream and Consumer Spending Dynamix™: 2009 Series.
Copyright© Geoscape®, www.geoscape.com, 1 (888) 211-9353. Page 8

9. America’s Secret Weapon
• Unlike other developed and developing countries, the U.S. has a
history of embracing cultural diversity and this could lead to a
strategic advantage in the world economy.
– “By 2030 Europe will have twice as many people over 65 as those
under 15.”
– “European and Asian societies do not seem to be able to take in and
assimilate people from strange and unfamiliar cultures in an era where
their future rides on its ability to take in many more.”
– “By 2010 foreign students in the U.S. will get over 50% of Ph.D.’s
awarded.”

10. America’s Secret Weapon
– “Half of all Silicon Valley start-ups have at least one founder who is
an immigrant or first generation American.”
– “Americans have almost always worried about their immigrants…but
these immigrants have gone on to become the backbone of the
American working class…America has been able to tap their energy,
manage their diversity, assimilate newcomers and move forward
economically. Ultimately, this is what sets [the U.S.] apart from other
historical powers…”
– Fareed Zakaria, The Post-American World
© Copyright Geoscape, www.geoscape.com, 1 (888) 211-9353. 10

11. Lifetime Profit Margin
Contribution
• LPMC is a metric that can help bring focus into a company‟s
decision to invest behind cultural diversity.
– Lifetime:
• Younger age at initial acquisition leads to potentially more years of relationship
– Profit Margin:
• Cost of acquisition could be lower as under-served consumers’ are acquired in a
less competitive environment, improving ROI and increasing margin
– Contribution:
• Compared to available alternatives, investment in cultural diversity could yield
higher returns

12. Aggregate Lifetime Spending per Household
3.5
500
120
600
350
35
80
Household Furnishings
Food atApparel Away
Total Expenditures
Transportation
Food at Home
Home &
Personal Care
Thousands (2008 $) 450
70
300
303 & Equipment
Products & Services
100
500
Millions
400
Cumlative Household Spending
Aggregate spending over the
60 lifespan of a Hispanic or
2.5
250
25
350 Asian household is usually
400
80 greater than that of Non-
50 Hispanic White households
300
200
202
NH White
250
300
40
60
Black
1.5
150
15
200
30 Asian
200
40
150 Hispanic
100
101
20
100
100
20
0.5
5
1050
50
00
0
2008 2013 2018 2023 2028 2033 2038 2043 2048 2053 2058 2063
2008 2013 2018 2023 2028 2033 2038 2043 2048 2053
2008 2013 2018 2023
Calendar Year ---Life Expectancy
Calendar Year Life Expectancy
Calendar Year Life Expectancy Median Age Life Expectancy
Non-Hispanic White 40 81
Source: Geoscape modeling on various data inputs. Hispanic 27 83
Asian 33 85
African American 30 77

13. Ask yourself….
• How much of your current business is Hispanic? Asian? Black?
• How are you doing with unacculturated Latinos?
• Who might be your best customers?
• What is your true opportunity in culturally diverse segments?

14. The Long Tail
• The new mainstream is a myriad of niches
– In the era of 3-network TV and bricks & mortar shopping, pop-culture meant marketers strived for “bit hits”
– In today’s era of diverse programming and over-abundant 24 / 7 product selection, the mass is made up of niches
• Marketers and business strategists have no choice but to
advance their micro-targeting capabilities to fully exploit the
opportunities
• “Many of our assumptions about popular taste are actually
artifacts of poor supply-and-demand matching—a market
response to inefficient distribution.”
– Chris Anderson, The Long Tail

15. Long Tail Chart on Cultural
Diversity
“The proliferation of product variety and
expansion of distribution channels increase
consumer choice and result in a greater
complexity of offerings to satisfy a diversity of
needs and wants.
:::
The outcome is that the sum of the mass-cultures
Unit Sales
rivals the size of the mass market.”
Mass
Market
Pop
Culture Segmented Markets — Diverse Culture
Product Types / Consumer Groups
© Copyright Geoscape, www.geoscape.com, 1 (888) 211-9353.

16. Demographic Data and
Trends
The Emergence of The New Mainstream

17. Population by Ethnicity/Race 1940-2014
“By 2014 the population in the three largest ethnic groups will be more than 110.4 million and Hispanics
will represent nearly half of that population.”
60,000,000
Hispanic
50,000,000
40,000,000
30,000,000 Black*
20,000,000
Asian & PI*
10,000,000
-
1940 1950 1960 1970 1980 1990 2000 2010
Population 1940 1970 1980 1990 2000 2009 2014
Asian & PI* 254,918 980,337 3,500,439 6,994,034 10,410,556 14,133,634 15,694,304
Black* 12,865,518 22,580,289 26,495,025 29,284,605 33,707,230 37,861,980 39,967,766
Hispanic 1,858,024 9,589,216 14,608,673 21,898,546 35,238,481 48,628,991 54,780,913
Total 31,669,275 203,211,926 226,545,805 248,684,787 281,421,906 307,469,178 322,217,026
Note: Population in the Commonwealth of Puerto Rico (3.97 million) is not included in Hispanic population figures.
Source: Geoscape; American Marketscape DataStream: 2009 Series and the U.S. Census Bureau. * 2000-2009-2014 numbers for Asian and Black are for non-Hispanic; 2009 and 2014
Estimates as of July 1.
Copyright© Geoscape®, www.geoscape.com, 1 (888) 211-9353. Page 17

18. U.S. Population: 2009 by Ethnic Group
About one-third of America’s population is of either Asian, Black or Hispanic origin; these proportions vary dramatically at the state
and metropolitan area levels. Many companies include Puerto Rico within their U.S. marketing efforts, although it is not technically
part of the U.S.
Commonwealth of
Puerto Rico add'l 1.3%
Hispanic
15.8%
Asian & Pacific Islander1
4.6%
Black1
12.3%
Other1
67.3%
Source: Geoscape, American Marketscape DataStream: 2009 Series.
1 Non-Hispanic portion of race.
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19. Increasing Cultural Diversity
The “Non-Ethnic”
market” is shrinking!
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
1940 1980 2020
Other Asian Black Hispanic
Hispanics may be any race, most are White (92.5%), Black (3.8%) or Native American (1.4%).
Source: US Census Bureau (1980 & 1990) and Geoscape (2020).
Copyright© Geoscape®, www.geoscape.com, 1 (888) 211-9353. Page 19

20. Growth 1990 to 2014 by Ethnicity/Race
The Non-Hispanic White population is a decreasing proportion of the U.S. population while Asians, Blacks and especially Hispanics are
forming a larger part of our nation.
80.0%
75.8%
69.1%
70.0%
65.2%
63.8%
60.0%
50.0%
40.0%
30.0%
20.0% 17.0%
15.8%
11.8% 12.0% 12.5% 12.3% 12.4%
8.8%
10.0%
4.6% 4.9%
2.8% 3.7%
0.0%
1990 2000 2009 2014
N-H White N-H Black N-H Asia & N-H PI Hispanic
Source: Geoscape, American Marketscape DataStream: 2009 Series.
Copyright© Geoscape®, www.geoscape.com, 1 (888) 211-9353. Page 20

21. Majority-Minority Counties: 2009
Top 25 Counties
(Except Non-Hispanic White)
Los Angeles, CA
Cook, IL
Harris, TX
Miami-Dade, FL
Non-Hispanic Whites are the Orange, CA
minority in an increasing Dallas, TX
number of counties—316 in Kings, NY
2009—including some of the
Queens, NY
largest like LA & Chicago.
San Bernardino, CA
Riverside, CA
Bronx, NY
Bexar, TX
Santa Clara, CA
Broward, FL
Alameda, CA
Philadelphia, PA
New York, NY
Honolulu, HI
Prince George's, MD
Hidalgo, TX
El Paso, TX
Fresno, CA
Fulton, GA
Orange, FL
Shelby, TN
Copyright© Geoscape®, www.geoscape.com, 1 (888) 211-9353. Page 21

22. ™
Acculturation: Hispanicity
“Acculturation is the process whereby immigrants acquire a new culture through language, customs,
lifestyle, media usage and other practices—they retain elements of their home culture as well. For
Hispanics, Geoscape calls this characteristic Hispanicity.”
• HA1: Americanizado
– English Dominant (nearly no Spanish)
– Born in US; 3rd+ generation
– Few Hispanic cultural practices
• HA2: Nueva Latina
– English Preferred (some Spanish)
– Born in U.S. 2nd generation
– Some Hispanic cultural practices
often “retro-acculturate”
• HA3: Bi-cultural
– Bi-Lingual (equal or nearly)
– Immigrant as child or young adult
– Many Hispanic cultural practices
• HA4: Hispano
– Spanish Preferred (some English)
– Immigrant as adult, in U.S. 10+ years
– Pre-dominant Hispanic cultural practices
• HA5: Latinoamericana
– Spanish Dominant (nearly no English)
– Recent Immigrant as adult (less than 10 years ago)
– Primarily Hispanic cultural practices
– Identify with home country more so than U.S. Hispanic Source: Geoscape, American Marketscape DataStream: 2009 Series.
Copyright© Geoscape®, www.geoscape.com, 1 (888) 211-9353. Page 22

23. ™
Hispanicity in 2009: Top 5 DMAs
“Recent immigrants have increased the portion of less acculturated HA5 Hispanics, while second and
third generation Hispanics have increased the proportion of HA1 & HA2 Hispanics. Although Hispanic
population will increase in all segments, the future trend will have a steady proportion of HA5,
increasing HA1-HA2, and decreasing HA3 and HA4.
100%
18.2% 16.0% 15.6% 16.4%
90%
32.2%
80%
18.2% 18.8% 19.0%
17.9%
70%
18.2%
60%
24.7% 25.9% 25.9%
27.3%
50%
22.7%
40%
30% 26.8% 27.3% 26.9%
27.0%
20% 22.4%
10% 15.3% 15.5% 15.7% 12.9%
7.3%
0%
CHICAGO HOUSTON LOS ANGELES MIAMI-FT. NEW YORK
LAUDERDALE
HA1: Americanizado HA2: Nueva Latina HA3: Bi-Cultural HA4: Hispano HA5: Latinoamericana
Copyright© Geoscape®, www.geoscape.com, 1 (888) 211-9353. Source: Geoscape, American Marketscape DataStream: 2009 Series. Page 23

24. Hispanic Language use in 2009: Top DMAs
“Spanish language use varies among the top five DMAs, however Spanish is preferred by about half of
Hispanics over Age 5 within each of these major metropolitan areas.”
100%
23.3% 23.1% 22.5% 21.9%
90% 27.9%
80%
70% 19.9% 20.9% 22.3%
22.2%
22.6%
60%
15.2% 13.6%
50% 14.7% 15.6%
15.8%
40%
25.2%
30% 24.6% 26.4%
27.3%
27.5%
20%
15.3% 15.3% 17.8%
10% 12.8%
6.2%
0%
Chicago Houston Los Angeles Miami-Ft. New York
English Dependent Bi-Lingual English Preferred Lauderdale Spanish Preferred Spanish Dependent
Bi-Lingual English & Spanish Bi-Lingual
Copyright© Geoscape®, www.geoscape.com, 1 (888) 211-9353. Source: Geoscape, American Marketscape DataStream: 2009 Series. Page 24

25. Hispanics in Florida are Cuban, right?
Hispanic Origin Pop 2009 % of Hispanic
Cuban 1,233,596 30.4%
Puerto Rican 808,164 19.9%
Mexican 659,476 16.3%
Colombian 278,531 6.9%
Dominican 158,073 3.9%
Nicaraguan 141,304 3.5%
Honduran 104,054 2.6%
Peruvian 100,384 2.5%
Venezuelan 96,099 2.4%
Guatemalan 79,242 2.0%
Ecuadorian 60,524 1.5%
Salvadoran 55,358 1.4%
Argentinean 51,893 1.3%
Panamanian 24,051 0.6%
Costa Rican 19,527 0.5%
Chilean 19,516 0.5% Cubans and Puerto Ricans are the Hispanic
Other Hispanic 165,392 4.1% majorities in only two Florida counties each
Total 4,055,184 100% whereas Mexican’s are the majority in 31.
Copyright© Geoscape®, www.geoscape.com, 1 (888) 211-9353. Page 25

26. Who is Geoscape?
Market Intelligence :: Intelligent Marketing :: Business Advantage

27. Geoscape Background
• Geoscape International, Inc. founded in ‟95 by Cesar Melgoza
• Geoscape Europe BV founded in „02
• Merged interests with Latin Force and Goldman Sachs and in June
‟07
– Now a Goldman Sachs portfolio company: Urban Investment Group
• Headquarters in Miami
27

28. Geoscape provides…
TransFirmation™
• Strategic Analytics Business Advantage
• Consulting Services
• Databases
• Market Intelligence Systems
Market Intelligence Intelligent Marketing
to corporations seeking growth by capitalizing on opportunities in
culturally-diverse consumer and business segments.

29. Conclusion
• Inaction could lead to missed opportunities to produce
growth
• Inefficiency is too expensive
© Copyright Geoscape, www.geoscape.com, 1 (888) 211-9353. 29

30. The Versailles Breakfast Club
Muchas gracias!
!
• Questions?
• Comments?

31. Accessing the New
Mainstream
Capitalizing on a Culturally Diverse America
Arthur R. Rockwell
Vice President, Sales
arockwell@geoscape.com
1 (888) 211-9353
www.geoscape.com
Access the New Mainstream