Hispanic-Americans, Mobile Advertising and Mobile Services

Journal of Promotion Management

ISSN: 1049-6491 (Print) 1540-7594 (Online) Journal homepage: http://www.tandfonline.com/loi/wjpm20

Hispanic-Americans, Mobile Advertising and Mobile Services Pradeep Korgaonkar, Maria Petrescu & Eric Karson To cite this article: Pradeep Korgaonkar, Maria Petrescu & Eric Karson (2015) HispanicAmericans, Mobile Advertising and Mobile Services, Journal of Promotion Management, 21:1, 107-125, DOI: 10.1080/10496491.2014.971211 To link to this article: http://dx.doi.org/10.1080/10496491.2014.971211

Published online: 27 Feb 2015.

Submit your article to this journal

Article views: 80

View related articles

View Crossmark data

Full Terms & Conditions of access and use can be found at http://www.tandfonline.com/action/journalInformation?journalCode=wjpm20 Download by: [Nova Southeastern University]

Date: 10 September 2015, At: 17:34

Journal of Promotion Management, 21:107–125, 2015 Copyright © Taylor & Francis Group, LLC ISSN: 1049-6491 print / 1540-7594 online DOI: 10.1080/10496491.2014.971211

Hispanic-Americans, Mobile Advertising and Mobile Services PRADEEP KORGAONKAR Downloaded by [Nova Southeastern University] at 17:34 10 September 2015

Florida Atlantic University, Davie, Florida, USA

MARIA PETRESCU Nova Southeastern University, Davie, Florida, USA

ERIC KARSON Villanova University, Philadelphia, Pennsylvania, USA

The literature on marketing to Hispanics and the use of mobilebased marketing methods continues to grow. However, to our knowledge, no research has been published on Hispanic use and acceptance of mobile marketing channels; this research addresses that gap. The study investigates various aspects of mobile channel services including advertising among Hispanic-Americans and non-Hispanic-Americans. The results indicate significant differences between Hispanic-Americans and others in the usage of mobile services, satisfaction with mobile services, and attitudes toward mobile advertising, as well as within Hispanic-Americans based on their strength of ethnic identification. The managerial and theoretical implications are discussed. KEYWORDS mobile commerce. mobile advertising. Hispanic marketing As of 2010, 42.7 million Americans owned a Smartphone while a significantly larger number of Americans subscribed to a variety of internet services on their mobile phones. For example, in this time period, 63.5% of U.S. mobile subscribers used text messaging on their mobile device; browsers were used by 28.6% of U.S. mobile subscribers, and 21.7% of subscribers played games. Additionally, social networking site access rose to 17.1% of mobile subscribers (comScore, 2010). Increasingly, mobile devices represent a Address correspondence to Dr. Pradeep Korgaonkar, Florida Atlantic University, 3200 College Ave., Davie, FL, 33314 USA. E-mail: [email protected] 107

Downloaded by [Nova Southeastern University] at 17:34 10 September 2015

108

P. Korgaonkar et al.

significant communication platform for advertising and a continuously developing market for a new generation of services (Kolsaker & Drakatos, 2009; Barutc¸u, 2007; Ferris, 2007; Haghirian, Madlberger, & Tanuskova 2005; Okazaki & Barwise, 2011; Tsang, Ho, & Liang, 2004). Given this, it is important for marketers to analyze the potential of mobile services as well as the way consumers accept diverse mobile services, including mobile advertising (H. H. Bauer, Reichardt, Barnes, and Neumann, 2005; Carroll, Barnes, & Scornavacca, 2007; Ferris; Mort & Drennan, 2007; Okazaki & Hirose, 2009). Past published research has shown that consumers’ preferences for mobile services differ as a function of various factors such as demographics (age, gender, and income), social norms, innovativeness, culture, and ethnicity (Bauer et al.; Bigne, Ruiz, and & Sanz, 2005; Laforet & Li, 2005; Y. Lee, Lee, Kim, & Kim, 2002; Muthitacharoen & Palvia, 2002; De Marez, Vyncke, Berte, Schuurman, & De Moor, 2007; Okazaki, 2008; Park, Yang, & Lehto, 2007; Pavlou & Chai, 2002; Sultan & Rohm, 2008). The current study builds upon prior research by filling the gap in the research on Hispanic-American and non-Hispanic Americans’ experience with, and evaluations of, 19 mobile services as well as attitudes toward mobile advertising. In a multicultural country such as the United States, it is beneficial for academic scholars and practitioners alike to establish the differences between customer segments based on ethnic background and affiliation, especially in emerging media. The globalized economy of today argues for more research on multicultural marketing in the USA as well as abroad. In the United States, the Hispanic community represents a key segment, with the 2010 Census counting 50.5 million Hispanic-Americans in the United States, making up 16.3% of the total population (Pew Research Center, 2010). Past research has established Hispanic-American consumers’ different attitudes relative to: media preferences, attitude toward advertising, direct marketing and Internet services adoption (Chung & Fischer, 1999; Kim & Kang, 2001; Korgaonkar, Karson, & Lund, 2000; Korgaonkar, Silverblatt, & O’Leary, 2001; Lee, 1993; Ueltschy & Krampf, 1997). For example, research found that Hispanic-American adults (30.4%) were more likely than non-Hispanic white adults (21.0%) or non-Hispanic black adults (25.0%) to be living in households with only wireless telephones (International Telecommunication Union, 2010). This shows the disproportionately higher dependency on and, as a consequence, usage of mobile services by this important ethnic market segment. This study is designed to test several hypotheses based on prior research related to the usage, perceived usefulness, satisfaction, and value of 19 mobile services, as well as global attitudes toward mobile advertising, between Hispanic- Americans versus non-Hispanic-Americans, as well within Hispanic-Americans based on acculturation with those weakly identifying with the Hispanic culture categorized as assimilated while those HispanicAmericans highly identifying with the Hispanic culture categorized as less

Hispanics and Mobile-Based Marketing Methods

109

assimilated. The following section reviews the literature leading to the development of specific hypotheses.

Downloaded by [Nova Southeastern University] at 17:34 10 September 2015

HISPANIC-AMERICAN CONSUMERS AND MOBILE SERVICES The term Hispano has been translated into the term Hispanic and describes individuals with a Spanish-language heritage (Villarreal & Peterson, 2008). The three key sources of the US Hispanic population are Mexico, Puerto Rico, and Cuba. As stated earlier, the Hispanic American population continues to grow at a higher rate than other Americans. Moreover, the segment is significantly younger in age than the rest of the country making it a good prospect for mobile services and advertising. Circa 2010, the median age of this segment is 27.4 years compared with 36.8 years for the population as a whole (www.census.gov). Sixty-three percent of Hispanic Americans are aged 18 to 41, whereas only 36% of whites and 46% for African Americans fall in this age range (Fox & Livingston, 2007). Furthermore, the buying power of this segment is growing faster than other ethnic categories and is estimated around $1 trillion (Albert & Jacobs, 2008). Laszlo (2009) notes a Pew report stating that 90% of U.S. English-speaking Hispanic-Americans with mobile communication devices have used one or more mobile data services, as compared with 79% of African Americans and 73%. As noted earlier Hispanic-American adults are more likely than non-Hispanic white adults or non-Hispanic black adults to be living in households with only wireless telephones. Past research also has shown that Hispanic-Americans tend to be brand loyal, buy brands that their parents bought, and like prestigious brands (Korgaonkar et al., 2000; Ogden, 2005). Moreover, researchers have found that Hispanic-American Internet usage equals or exceeds that of non-HispanicAmericans with regard to many online activities (Becerra & Korgaonkar, 2010), including using and spending (Lassar, Manolis, & Nicholls, 2005). Studies also report ethnic differences regarding ownership of electronics such as television, internet service, and mobile phones, with Latinos judging television and other technologies more favorably than other ethnic categories (Albert & Jacobs, 2008; Kim & Kang, 2001). Researchers also found differences between Hispanic-American and non-Hispanic American consumers in the domain of direct marketing, which some regard as a basis for internet and mobile marketing, relating to attitudes, beliefs, and purchase behavior (Korgaonkar, Karson, & Lund, 2001). Regarding the different mobile services, ethnic studies have also noted that cultural factors influence the needs and values of mobile internet users, as well as their post-adoption perceptions of mobile internet services (Sultan, Rohm, & Gao, 2009; Y. Lee et al., 2002; I. Lee, Choi, Kim, & Hong, 2007). For example, Laforet and Li (2005) found differences in attitude toward mobile banking between China and Western

Downloaded by [Nova Southeastern University] at 17:34 10 September 2015

110

P. Korgaonkar et al.

countries, whereas Park et al. (2007) found a social influence in Chinese users’ attitude toward mobile technology adoption. In addition to these general differences, Hispanic-Americans’ use of mobile services does vary based on cultural identity. Korzenny (2008) conclude that non-Hispanic whites report using their cell phones about half the time the other groups do. Perhaps motivating this higher mobile connectivity is research demonstrating higher levels of social interaction and communication with their social circle (Miyazaki, Lassar, & Taylor, 2007). Perhaps capturing the demonstrable differences in mobile phone usage, a recent report on mobile consumers suggests five different segments. The segment one termed Mobirati is 20% of the population. They represent the mobile generation; they have grown up with cell phones and cannot imagine life without them. Cell phone devices are a central part of their everyday lives. The second group is 22% is called the Social Connectors. Communication is central in their lives, and cell phones allow them to keep up-to-date with friends and social events. Their phone is the bridge to their social world. The third group named Mobile Professionals 18% of the population. Smartphones help them keep up with their professional and personal life. Their phone has become their all-in-one device for communication and information needs. The fourth group called the Pragmatic Adopters is 20%. Cell phones came to being during their adult years. They are now learning that there are other things they can do with mobile phones beyond just saying “Hello.” Finally, the fifth group termed the Basic Planners 21% of the population. They are not into cell phones or the world of technology. Use of cell phones is just for the basics. The cell phone is just another communication device for these consumers. The study reports that (33%) of Hispanic-Americans (versus 18% of non-Hispanic-Americans) are more likely to be Mobirati, more frequently: downloading music, watching streaming videos, engaging in video chats, checking emails, playing games, and so forth (Simmons, 2011). The study confirms the findings that Hispanic-Americans not only love their mobile phones but are more likely than other Americans to take them everywhere (http://clubtextea.com/sms-services/sms-mobile-hispanic-articles, 2011). Given these differences, however, it is difficult to lump all “mobile services” together given the variety of services offered, ranging from voice services, to more complicated online payment or gaming (Nysveen, Pedersen, and Thorbjørnsen, 2005). The diverse mobile applications complement existing business information systems, such as financial transactions and advertising, as well as personal services, from reading the news to checking the weather and buying movie tickets (Mahatanankoon, 2007). Researchers also note that numerous mobile services are significantly relevant for marketers and advertisers, including shopping alerts and coupons, maps, email, and buying products online (Harris, Rettie, and Kwan, 2005; Mort & Drennan, 2007).

Downloaded by [Nova Southeastern University] at 17:34 10 September 2015

Hispanics and Mobile-Based Marketing Methods

111

All these mobile services are important because they can be used for mobile advertising communication as well as embedding advertising into the mobile services themselves. This later is important as Mort and Drennan (2007) note that if consumers feel that their mobile phones are useful and beneficial they will increase their involvement and use with mobile devices. Similarly, Shankar and Balasubramanian (2009) found that buyers of entertainment, music, and video products were more responsive to mobile marketing than consumers of other product categories. As per Smith (2011), 18% of Hispanic-Americans are Twitter users versus 5% for nonHispanic whites and 13% for non-Hispanic blacks. BIG research, an online marketing company, suggests 54% of Hispanic-Americans, as opposed to 43% non-Hispanic whites and 47.7% non-Hispanic blacks, are regular users of Facebook (www.latino.foxnews.com/latino/lifestyle/2011). The same study reports higher use of other mobile services such as Foursquare by HispanicAmericans. A study by ComScore (2010) reported a higher use by HispanicAmericans for activities such as MySpace, Yahoo Pulse, Digg, and so forth. Thus, the notion that Hispanic-Americans are more family and socially driven does lead to a higher use of the variety of mobile services than non-Hispanic Americans. Regarding satisfaction with mobile services, one survey of satisfaction with the Internet performance on a mobile device indicated that 46% Hispanic-Americans, as opposed to 30% of whites and 36% of AfricanAmericans, were satisfied. It is hypothesized the satisfaction with Internet performance on the mobile phones will also be reinforced with the mobile services studied here (www.agri-pulse.com/uploaded/FCC_Survey.pdf). As for value perceptions, as Hispanic-Americans still lag behind other Americans in home computer usage (because of the high investment and maintenance related to computers), they are more likely to rely more on mobile phones and mobile services (Kutchera, 2010). This leads to belief that Hispanic-Americans will perceive mobile services as a greater value (inexpensive) opposed to the other Americans, given it is more likely their sole connection to the internet. Finally, a growing body of research (Sierra, Hyman, & Torres, 2009; Sierra, Hyman, & Heiser, 2012) shows that ethnicity plays an important role in how consumers process and accept advertising. In their review, Sierra, Hyman, and Torres (2009) highlight a number of a theoretic studies that demonstrate an effect of ethnicity on advertising processing and effects (e.g., Deshpande, Hoyer, & Donthu, 1986; Webster, 1992). Furthermore, reviewing the effects of ethnicity on advertising, Sierra et al. (2009) report how both the Distinctiveness (Aaker, Brumbaugh, & Grieg, 2000; Forehand & Deshpande, 2001) and Accommodation (Green, 1999) theoretical frameworks apply. The authors then apply Social Identity Theory to show the effect of ethnicity on print ad response. Our goal is to broaden this research into the domain of mobile marketing.

112

P. Korgaonkar et al.

The preceding discussion of various studies leads us to hypothesize whether knowledge gained through the study of other media will also apply to the decidedly different context of mobile marketing. In the context of 19 different mobile services we look for the effect of ethnicity on four dimensions: a) Frequency of use, b) Perceived usefulness, c) Satisfaction, and d) Value. It is hypothesized that given the centrality and importance of mobile services to Hispanic-Americans, as opposed to the non-Hispanic-Americans, and the findings of aforementioned published studies:

Downloaded by [Nova Southeastern University] at 17:34 10 September 2015

H1: Hispanic-American consumers will have a higher usage of mobile services than non-Hispanic American consumers. H2: Hispanic-American consumers will find mobile services more useful than non-Hispanic-Americans. H3: Hispanic-American consumers will be more likely to be satisfied with mobile services than non-Hispanic-Americans. H4: Hispanic-American consumers are less likely to find the mobile services expensive (e.g., it is a better value) than non-Hispanic-Americans.

HISPANIC-AMERICANS AND MOBILE ADVERTISING In looking at attitudes towards advertising research repeatedly demonstrates that Hispanic-Americans tend to be more favorable toward advertising, including direct marketing and web advertising, than other ethnic categories, as well as value it as an important source of information (Deshpande et. al., 1986; Korgaonkar et al., 2000, Korgaonkar, Silverblatt, et al., 2001). Additionally, Hispanic-Americans are positively influenced by advertising and value advertised brands (Korgaonkar et al., 2000). Other researchers found that Hispanic web users’ interest in online advertising depends on their perceptions about providing useful information, entertainment and enhancing social roles (Korgaonkar, Silverblatt, et al., 2001). The positive attitudes of Hispanic-Americans toward advertising are also reflected in their evaluations of mobile advertising. For example, a recent report (experian.com/simmons) states that the Hispanic cell phone owners are more than twice as likely as non-Hispanic-Americans to say they are interested in receiving ads on their phones and buy the products advertised on them. Given the previous literature review and findings regarding traditional advertising, as well as internet ads, direct response advertising and mobile advertising: H5: Hispanic-American consumers will have more positive attitudes than non-Hispanic-Americans toward mobile advertising.

Hispanics and Mobile-Based Marketing Methods

113

Downloaded by [Nova Southeastern University] at 17:34 10 September 2015

Past published research suggests that there are differences among the Hispanic-American consumers based on the degree of their ethnic identification (Becerra & Korgaonkar, 2010; Singh, Baack, Kundu, & Hurtado, 2008; Villarreal & Peterson, 2008). As studies found variations in consumer behavior within the Hispanic segment due to the degree of ethnic identification, the following section analyzes this important aspect within the Hispanic sample in the study.

HISPANIC-AMERICANS AND STRENGTH OF ETHNIC IDENTIFICATION The United States is referred to as the “melting pot” and, more recently, the “salad bowl,” includes a variety of ethnicities that not only melt together, but also keep their own specific cultural identities (Sison, 2008). The “melting pot” perspective focuses on the assimilation process, while the “salad bowl” perspective includes a multicultural process. The multicultural perspective assumes that individuals retain their culture of origin, but also adopt elements of the host culture (Becerra & Korgaonkar, 2009; Korgaonkar et al., 2000). “Hispanicness” depends not only on being born into a Hispanic family, but also on the strength of ethnic identification and cultural values, leading to different Hispanic segments based on these variables (Burgos, 2008; Villarreal & Peterson, 2008). Researchers found that the degree of acculturation and strength of ethnic identification led to differences in Hispanic-Americans regarding their attitude toward traditional and direct marketing advertising, media usage, information search and consumer behavior (Becerra & Korgaonkar, 2009, 2010; Deshpande et al., 1986; Korgaonkar et al., 2000; Singh, Baack, Pereira, & Baack, 2008; Ueltschy & Krampf, 1997). Deshpande et al. found more similarities between weak Hispanic identifiers and Anglos, than between weak and strong Hispanic identifiers, regarding preferences for prestige and ethnically advertised brands. In a comprehensive look at the need to segment the Hispanic marketing based on acculturation Palumbo and Teich (2005) highlight a number of factors that affect acculturation: Demographics (age and income); English language ability; Ethnic identity (attitude toward their homeland); and whether an individual has family remaining in the homeland. They conclude that “A fundamental error made by marketers trying to reach the Hispanic audience is the viewing the Hispanic community as homogeneous” (p. 166). Becerra and Korgaonkar (2010) note that, while Hispanic Americans share a common cultural background, their strength of identification to the Hispanic culture varies. They conclude that the influence of ethnic identification is significant for attitudes toward web advertising and online purchase intentions. Researchers find that Hispanic-Americans with a strong ethnic identification prefer more traditional media, advertising that is in

Downloaded by [Nova Southeastern University] at 17:34 10 September 2015

114

P. Korgaonkar et al.

Spanish or fits the Spanish culture and traditions, have similar positive views of advertising, and rely more on advertising for information (Becerra & Korgaonkar, 2010; Ogden, 2005; Singh, Baack, Pereira, et al., 2008; Villarreal & Peterson, 2008). Torres and Briggs (2007) found that Hispanic-Americans with high ethnic identification respond more favorably to advertisements for high and low-involvement products than Hispanic-Americans with low ethnic identification. Even studies on other ethnic groups show the importance of acculturation on individual ethnic characteristics. Lee (1993) found that the attitude toward advertising of the Taiwanese subculture in the United States differs as a function of acculturation. The studies in the aforementioned marketing literature reviewed suggest that as Hispanic-Americans become more assimilated (i.e., as they identify less toward their own ethnic culture), their attitudes and behaviors closely resemble the attitudes and behaviors of the non-Hispanic-Americans born in the United States. It is expected the same pattern to hold true for mobile services and the attitudes toward mobile advertising. Thus, the hypotheses that there are differences within the Hispanic segment regarding (a) usage of various mobile services, (b) usefulness of services, (c) satisfaction with the services, (d) perceived value of services, and (e) attitudes toward mobile advertising due to strength of ethnic identification. Specifically: H6: Within Hispanic consumers, the usage of mobile services will be higher for those with higher ethnic identification than those with lower ethnic identification. H7: Within Hispanic consumers, the perceived usefulness of mobile services will be higher for those with higher strength of ethnic identification than those with lower identification. H8: Within Hispanic consumers, the satisfaction with mobile services will be higher for those with higher strength of ethnic identification than for those with lower identification. H9: Within Hispanic consumers, those with higher strength of ethnic identification will consider mobile services a better value than those with the lower identification. H10: Within Hispanic consumers, the attitudes toward mobile advertising will be more positive for those with a higher strength of ethnic identification than for those with the lower identification.

The following section presents the methodology used to test the hypotheses, including the sample, operationalization of variables, and empirical testing procedures.

Hispanics and Mobile-Based Marketing Methods

115

TABLE 1 Combined Sample Demographics Gender Age Occupation Education

Male

Female

47% 16–20 4% Student 42.40% HS 10.5%

53% 21–23 20.9% FT Employed 23.50% UG 51.7%

24–28 30.9% Unemployed 27.70% Grad student 24.8%

>28 44.2% Retired 0.50% Postgraduate degree 9.6%

Ph.D 0.6%

Downloaded by [Nova Southeastern University] at 17:34 10 September 2015

n = 656.

METHOD Data Collection Data was collected in two stages to assure adequate representation of respondents. In the first stage, data were collected in an area with a significant (about 30%) Hispanic-American population. Understanding this could have negatively limited the applicability to a wider audience i. e. to improve the generalizability of the study a follow up in the second stage with a national sample of respondents utilizing a national data collection firm was undertaken. In both cases the data were collected via an online survey. In the absence of a national list of contact information of Hispanic Americans a nonprobability sample was used. Statistical analysis showed the respondents in both studies were similar in their demographic makeup. After eliminating the missing values, sample totaled 347 consumers contacted at national level and 309 students from a large public university in southeast United States. The demographic characteristics of the sample are shown in Table 1. A t–test was performed to see if there are any differences between the two samples, especially regarding demographics. As there were no significant differences between the two samples, the samples were combined for analysis.

Measurement The survey included four major sections. The first section included questions related to consumers’ mobile services history, from “how many mobile phones do you have” to “which service provider are you using” (Harris et al., 2005). Next, after respondents answered whether or not they used a particular service, part two of each questionnaire asked respondents to rate, using a 5-point Likert-like scale (1 = not at all to 5 = very), their frequency of use, perceived usefulness, perceived value, and perceived satisfaction with 19 mobile services, from voice to news, maps, and internet browsing (Harris et al.). Part three included seven questions related to consumers’ attitude toward mobile advertising (Barutc¸u, 2007) measured on a 5-point Likert-like

116

P. Korgaonkar et al.

TABLE 2 Factor Analysis: 19 Mobile Services on Four Evaluative Characteristics

Downloaded by [Nova Southeastern University] at 17:34 10 September 2015

Frequency Usefulness Satisfied Expensive

Reliability alpha coefficient

Eigenvalue

0.921 0.920 0.921 0.929

7.536 7.684 7.749 8.749

scale. Part four of the survey included demographic questions, as well as the scale measuring ethnic strength, on a 5-point Likert-like scale, including six questions such as “I have a strong sense of belonging to my own ethnic group.” The statements were chosen from past validated scale.

Validation After exploratory analyses to establish the normality of the data and identify possible outliers, several steps were taken in order to validate our dependent and independent variables. In order to measure and to validate consumers’ evaluations for each of the 19 analyzed mobile services, factor analysis was performed and a regression factor score was formed for each service based on the four rating elements: frequency of use, usefulness, satisfaction, and value, using a Varimax rotation. The results are shown in Table 2. All variables loaded as expected, validating the four dependent variables: frequency of use, usefulness, satisfaction, and value. The Eigenvalues for each dependent variable were as follows: Frequency: 7.536, Usefulness: 7.684, Satisfaction: 7.749, and Value: 8.749. Coefficient alpha for the four dimensions were 0.92, 0.92, 0.92, and 0.93, respectively, indicating their reliability. To measure attitudes toward mobile advertising, the past literature was consulted. The pioneering study of attitudes toward advertising by R. A. Bauer and Greyser (1968) conceptualized the concept on only two dimensional: social and economic. At the other end of the spectrum Pollay and Mittal (1993) conceptualized it as seven dimensions: product information, social role and image, hedonic pleasure, value corruption, falsity/non sense, good for the economy, and materialism. There are other studies that have considered dimensions that are in between such as: informativeness, trust, and irritation (Schlosser, Shavitt, and Kanter, 1999; Brackett and Carr, 2001; Barutc¸u, 2007). Another exploratory factor analysis established the scale used to measure attitude toward mobile advertising. The measurement of attitudes toward mobile advertising was in line with past research in the area. Our study captured two dimensions of informativeness, and trust of attitudes toward mobile advertising. The statements measured via 5-point scale of (1) strongly agree to (5) strongly agree were: I like mobile advertising, I think mobile advertisements are trustworthy, I think mobile advertisements are

117

Hispanics and Mobile-Based Marketing Methods TABLE 3 MANOVA for Strength of Ethnic Identification∗ Group 1 Group 2 Group 3 Wilk’s Lambda

Downloaded by [Nova Southeastern University] at 17:34 10 September 2015

Attitude toward mobile Advertising Frequency Usefulness Satisfied Expensive

Weak ethnic identif. (4–10) Medium ethnic identif. (11–15) Strong ethnic identif. (16–20) Value 0.925 F 1.465 10.088 6.426 8.105 14.113

45.2% 39.8% 14.9% F 2.021 Sig 0.743 0.018 0.2 0.116 0.049

Sig. 0.030

Note. ∗ A separate paired test of significance (Bonferroni) confirmed the significant differences between each of the three pairs for only the two significant variables.

useful, and I think mobile advertisements are informative. The reliability coefficient alpha of the validated scale was 0.93. The measurement of ethnic identification was in line with past research in the area. Scholars in the area have conceptualized identification as the self-perceived strength of assimilation (Hirschman, 1981), intensity of ethic affiliation (Deshpande et al., 1986), intermarriage (Martin, Sabogal, Martin, Otero-Sabogal, & Perez, 1987), and language proficiency (Delgado, Johnson, and Trevino, 1990). The study relied on the scale developed by Phinney (1992) which captures two aspects of ethnic practices: involvement in social activities and participation in cultural traditions common to the culture. The two aspects of ethnic identification were not expected to be independent of each other but be part of the same construct. To validate, a factor analysis for the strength of ethnic identification items was undertaken. Four of the six items clearly loaded on the same factor (Eigenvalue of 3.18 and coefficient alpha of 0.80) as reported in Table 3, and the resulting scale was employed for analysis. After having ensured the validity and reliability the following section reports the tests of study hypotheses.

Hypotheses Testing To test the hypotheses regarding the differences between HispanicAmericans and non-Hispanic-Americans MANOVA was run, including the variables of interest from usage of different services offered by the mobile technology, as well as attitudes towards mobile advertising. The sample included 261 Hispanic-Americans and 395 non-Hispanic-Americans. The model is significant (p < .01) for the key four indicators: Pillai’s Trace, Wilks’ Lambda, Hotelling’s Trace, and Roy’s Largest Root. The results are presented in Table 4. Of the first five hypotheses all but one (H4) were supported. Significant differences regarding the usage of various mobile services were found

118

P. Korgaonkar et al.

TABLE 4 MANOVA for Hispanic-Americans vs. non-Hispanic-Americans∗

Downloaded by [Nova Southeastern University] at 17:34 10 September 2015

Wilk’s Lambda

Satisfied with mobile serv. Frequency Usefulness Expensive Attitude toward mobile advertising ∗ mean

Value

F

Significance

0.968

4.661

0.001

Mean Hispanic-Americans 0.17

Mean non-HispanicAmericans −0.11

F

Sig.

11.934

0.001

0.16 0.14 0.09 0.07

−0.10 −0.086 −0.06 −0.09

10.855 7.703 3.353 4.497

0.001 0.006 0.068 0.034

values reflect factor regression scores from validated scales.

between Hispanic-Americans and non-Hispanic-Americans, as well as their attitudes toward mobile advertising. The results also show that HispanicAmericans differ regarding their strength of ethnic affiliation, providing the base for the second part of analysis. Regarding the failure of H4 (the better value Hispanics attach to mobile services), although it is directionally and marginally supported (p < .068), and given their higher usage, perceived usefulness, satisfaction, and general positive attitudes Hispanics express about mobile services, we can only posit that the general perception that mobile service is expensive is nearly universal among all mobile users, explaining the lack of support for H4. In order to test the hypotheses regarding the differences within the Hispanic population, data separated this group into three categories: weak (4–10), medium (11–15), and strong (16–20) identification, based on their scores for the ethnic identification items. Based on these three groups, MANOVA analysis tested hypotheses 6 thru 10 (differences within HispanicAmericans on usage and attitudes toward mobile services and advertising). As Table 3 shows, results were significant (p < .01) for the key four indicators: Pillai’s Trace, Wilks’ Lambda, Hotelling’s Trace, and Roy’s Largest Root. As seen, there are differences regarding the usage of four of the different mobile services analyzed, lending partial support for Hypothesis 6. The study also find support for Hypothesis 9, showing that Hispanic-Americans evaluate mobile services differently, based on the strength of ethnic affiliation. However, study did not find any differences regarding satisfaction and attitude toward mobile advertising.

IMPLICATIONS Previous research has shown that Hispanic consumers are different across a host of consumer behaviors such as product adoption, media preferences,

Downloaded by [Nova Southeastern University] at 17:34 10 September 2015

Hispanics and Mobile-Based Marketing Methods

119

attitude toward advertising and Internet services adoption (Chung & Fischer, 1999; Deshpande et al., 1986; Kim & Kang, 2001; Korgaonkar et al., 2000; Korgaonkar, Silverblatt, et al. 2001; Lee, 1993; Ueltschy & Krampf, 1997). Given the significant growth of both mobile technology and the Hispanic segment in the United States, the analysis focused on the differences between Hispanic-Americans and non-Hispanic-Americans, and within Hispanic-Americans regarding mobile communication and advertising based on strength of ethnic identification. While difficult in a nascent rapidly growing medium-like mobile, the results of this study clearly show that there are significant differences between Hispanic-Americans and non-Hispanic-American consumers regarding important aspects of attitude toward mobile advertising, perceived usefulness of mobile services, satisfaction with mobile services, and usage of different mobile services. Thus, four of out of the first five key hypotheses were supported. This means that as practitioners begin to hone their skills in mobile they must pay attention to ethnic identities. As shown, Hispanic-Americans also differ from the other consumer segments regarding their attitude toward mobile advertising and are more likely to be interested in this type of mobile communication,. This is an important finding for those businesses that cater to Hispanic-Americans, confirming that, versus other Americans, Hispanic-Americans appear more universally positive toward advertising (Becerra & Korgaonkar, 2010; Deshpande et. al., 1986; Korgaonkar et al., 2000; Korgaonkar, Silverblatt, et al., 2001). This presents an opportunity for marketing practitioners who may specifically target Hispanic-Americans via mobile services and advertising. The study confirmed previous findings that noted possible cultural differences in mobile phone usage, and showed that Hispanic-Americans are more likely to use the services offered by mobile technology, potentially due to their propensity to more constantly communicate with their extended family (Laszlo, 2009; Miyazaki et al., 2007). This is, again an important finding for mobile communication managers and marketers, and highlights the high marketing potential of the Hispanic segment via mobile devices. Moreover, the study results debunk older studies about HispanicAmericans, often cast as lower income and less educated, as less likely to use new technologies (Albert & Jacobs, 2008; Korgaonkar, Silverblatt, et al., 2001). Given the significant increase of the Hispanic population our study results demonstrate that this is not only a large market segment for mobile services, but also one with high profit potential. The results of the study indicate that Hispanic-Americans not only use more mobile services, but that they find these services more useful and also have higher levels of satisfaction with these services. From this point of view, practitioners need to pay attention not only to Hispanic-Americans’ satisfaction levels, but also to differences regarding their demands and expectations compared to other ethnic groups.

Downloaded by [Nova Southeastern University] at 17:34 10 September 2015

120

P. Korgaonkar et al.

The analysis also brings new information regarding the differences within the Hispanic-American population. It demonstrates that HispanicAmericans are not homogeneous, and important differences arise related to an individual’s level of acculturation. The results in Table 3 clearly show differences regarding mobile services within the Hispanic group based on the strength of ethnic identification. Here, the weak ethnic identifiers (most acculturated) were the highest users of mobile services, while the high ethnic identifiers (least acculturated) were more likely to feel that mobile services were expensive. The differences within the Hispanic-Americans also hold true for six services of: local information, online games, downloading wallpaper, browsing the internet, and online betting. The weak ethnic identifiers were the highest and most satisfied users of online games, downloader of wallpaper from the mobile phone. The high ethnic identifiers were the most satisfied users of local information, surfers of the Internet, and betting on the Internet using the mobile phones. This confirms previous research noting that ethnicity is a psychological construct that differs across individuals of the same ethnic group and varies due to acculturation and interpersonal relationships (Chung & Fischer, 1999; Villarreal & Peterson, 2008). Clearly marketers need to understand that simple ethnic segmentation in the United States is no longer enough, and needs to be accompanied by other differentiators, such as language spoken, the nuances of language, and relationship with the community that are included in the acculturation process. The study by Noriega and Blair (2008) indicates the importance of culturally induced ad triggers in connecting with less acculturated HispanicAmericans. Consumers who are high on ethnic identification will rely more on, as well as prefer content that reflects Hispanic themes (Singh, Baack, Pereira, et al., 2008). Overall, the results of this study help managers in formulating their target segments for mobile services and mobile advertising, as well as in better targeting the members of the Hispanic community that appreciate the mobile technology.

LIMITATIONS AND FUTURE DIRECTION Given the growth of both the impact of the Hispanic consumer in the marketplace and the rapid evolution of mobile marketing methods, this research is clearly a snapshot in time of a highly dynamic area. In part because of their high reliance on mobile versus other means to access the internet, even though a portion of our sample was from a national sample, finding a means to reach a truly representative sample of Hispanics will continue to be problematic. Complicating this, work on delivering surveys via mobile devices is extremely limited. Additionally, we asked respondents about their attitudes towards and behaviors with mobile devices in general. One of the emerging strengths of

Hispanics and Mobile-Based Marketing Methods

121

mobile marketing is the ability to target both geographically and temporally— clearly no extant marketing channel can do a better job delivering messages at the right time, to people in the right place, than mobile. Ideally, future research will capture the benefits of such highly targeted messaging.

Downloaded by [Nova Southeastern University] at 17:34 10 September 2015

CONCLUSIONS This study found that there are significant ethnic differences between Hispanic-Americans and non-Hispanic-Americans related to mobile services usage and attitude toward mobile advertising. These results contribute to the marketing literature regarding the characteristics of Hispanic consumers and confirm the persistent differences between Hispanic-Americans and nonHispanic-Americans regarding different consumer behavior variables, notably the higher usage rate of mobile services for Hispanic-Americans. It also contributes to the acculturation literature, by underlining the differences in mobile services usage and attitude toward mobile services within the Hispanic segment based on strength of ethnic identification. Given the importance of the mobile technology for marketers, future studies can focus in detail on preferences for specific mobile services based on diverse variables, from ethnicity, to other demographics such as age and income. Moreover, an in-depth analysis on what Hispanic consumers expect from mobile advertising and their preferences regarding placement, appeals, and language of the ad are also topics for future research regarding Hispanic-Americans and mobile technology.

REFERENCES Aaker, J. L., Brumbaugh, A. M., & Grier, S. A. (2000). Nontarget markets and view distinctiveness: The impact of Target Marketing on advertising attitudes. Journal of Consumer Psychology, 9, 127–140. Albert, T. C., & Jacobs, R. D. (2008). Television attitudes and TV types of AfricanAmericans, Latinos, and Caucasians. Journal of Advertising Research, 48, 235–246. Barutc¸u, S. (2007). Attitudes towards mobile marketing tools: A study of Turkish consumers. Journal of Targeting, Measurement and Analysis for Marketing, 16, 26–38. Bauer, R. A., & Greyser, S. A. (1968). Advertising in America: The Consumer View. Boston, MA: The Harvard University Press. Bauer, H. H., Reichardt, T., Barnes, S. J., & Neumann, M. M. (2005). Driving consumer acceptance of mobile marketing: A theoretical framework and empirical study. Journal of Electronic Commerce Research, 6, 181–192. Becerra, E. P., & Korgaonkar, P. K. (2009). Hispanic-Americans’ information search and patronage intentions online. Journal of Electronic Commerce Research, 10, 76–93.

Downloaded by [Nova Southeastern University] at 17:34 10 September 2015

122

P. Korgaonkar et al.

Bigne, E., Ruiz, C., & Sanz, S. (2005). The impact of internet user shopping patterns and demographics on consumer mobile buying behavior. Journal of Electronic Commerce Research, 6, 193–209. Brackett, L. K., & Carr, B. N. (2001). Cyberspace advertising vs. other media: Consumer vs. mature student attitudes. Journal of Advertising Research, 41, 23–32. Burgos, D. (2008). Use and abuse of cultural elements in multicultural advertising. Journal of Advertising Research, 48, 177–178. Carroll, A., Barnes, S. J., & Scornavacca, E. (2007). Consumers’ perceptions and attitudes towards SMS mobile marketing in New Zealand. International Journal of Advertising, 26, 79–99. Chung, E., & Fischer, E. (1999). It’s who you know: Intracultural differences in ethnic product consumption. The Journal of Consumer Marketing, 16, 482–501. ComScore. (2010). comScore reports January 2010 U.S. mobile subscriber market share’, Retrieved May 1, 2010, from http://www.comscore.com/Press_Events/ Press_Releases/2010/3/comScore_Reports_January_2010_U.S._Mobile_Subscriber_Market_Share Delgado, J. L., Johnson, C. L., & Trevino, F. M. (1990). Hispanic health and nutrition examination survey: methodological considerations. American Journal of Public Health, 80, 7–10. De Marez, L., Vyncke, P., Berte, K., Schuurman, D., & De Moor, K. (2007). Adopter segments, adoption determinants and mobile marketing. Journal of Targeting, Measurement and Analysis for Marketing, 16, 78–95. Deshpande, R., Hoyer, W. D., & Donthu, N. (1986). The intensity of ethnic affiliation: a study of the sociology of Hispanic consumption. Journal of Consumer Research, 13, 214–220. Ferris, M. (2007). Insights on mobile advertising, promotion, and research. Journal of Advertising Research, 47, 28–37. Forehand, M. R., & Deshpande, R. (2001). What we see makes us who we are: Priming ethnic self-awareness and advertising response. Journal of Marketing Research, 38, 336–348. Fox, S., & Livingston, G. (2007). Latinos Online: Hispanics with Lower Levels of Education and English Proficiency Remain Largely Disconnected from the Internet. Retrieved from http://eric.ed.gov/ERICDocs/data/ericdocs2sql/ content_storage_01/0000019b/80/28/06/54.pdf Green, C. L. (1999). Ethnic evaluations of advertising: Interaction effects and strength of ethnic identification. Journal of Advertising, 28, 49–64. Haghirian, P., Madlberger, M., & Tanuskova, A. (2005). Increasing advertising value of mobile marketing – An empirical study of antecedents. Proceedings of the 38th Hawaii International Conference on System Sciences, 1–10. Harris, P., Rettie, R., & Kwan, C. C. (2005). Adoption and usage of m-commerce: a cross-cultural comparison of Hong Kong and the United Kingdom. Journal of Electronic Commerce Research, 6, 210–224. Hirschman, E. C. (1981). American Jewish ethnicity: Its relationship to some selected aspects of consumer behavior. Journal of Marketing, 45, 102–110. Inglesis, M. G., McGavock, H., & Korzenny, F. (2007). Advertising to HispanicAmericans: What the ads say a content analysis of portrayals, communication devices and execution. Working Paper, Center for Hispanic Marketing Communication, Florida State University.

Downloaded by [Nova Southeastern University] at 17:34 10 September 2015

Hispanics and Mobile-Based Marketing Methods

123

International Telecommunication Union Statistics. (2011). Wireless only households in the USA rising., Retrieved from http://www.itu.int/ITUD/ict/newslog/Wireless+Only+Households+In+The+USA+Rising.aspx Kim, Y.-K., & Kang, J. (2001). The effects of ethnicity and product on purchase decision making. Journal of Advertising Research, 41, 39–48. Kolsaker, A., & Drakatos, N. (2009). Mobile advertising: The influence of emotional attachment to mobile devices on consumer receptiveness. Journal of Marketing Communications, 15, 267–280. Korgaonkar, P. K., Becerra, E., & Lund, D. (2000). Hispanic-Americans and direct marketing advertising. Journal of Consumer Marketing, 17, 137–157. Korgaonkar, P. K., Karson, E., & Lund, D. (2001). Direct marketing: a comparison of Hispanic and non-Hispanic perspectives. International Journal of Advertising, 20, 25–47. Korgaonkar, P. K., Silverblatt, R., & Becerra, E. (2004). Hispanic-Americans and patronage preferences for shopping from the Internet. Journal of ComputerMediated Communication, 9(3), Retrieved http://jcmc.indiana.edu/vol9/issue3/ korgaonkar.html Korgaonkar, P. K., Silverblatt, R., & O’Leary, B. (2001). Web advertising and HispanicAmericans. Journal of Consumer Marketing, 18, 134–152. Korzenny, F. (2008). Multicultural marketing and the reasons why. Journal of Advertising Research, 48, 173–176. Kutchera, J. (2010). Latino link: Building brands online with Hispanic communities and content. New York, NY: Paramount Market Publishing, Inc. Laforet, S., & Li, X. (2005). Consumers’ attitudes towards online and mobile banking in China. The International Journal of Bank Marketing, 23, 362–380. Lassar, W., Manolis, C., & Nicholls, J. (2005). Antecedents of online purchasing: an exploratory comparison of Anglo versus Hispanic consumers in the United States. Journal of Internet Commerce, 4, 27–61. Laszlo, J. (2009). The new unwired world: An IAB status report on mobile advertising. Journal of Advertising Research, 49, 27–43. Lee, I., Choi, B., Kim, J., & Hong, S.-J. (2007). Culture-technology fit: Effects of cultural characteristics on the post-adoption beliefs of mobile internet users. International Journal of Electronic Commerce, 11, 1–51. Lee, W.-N. (1993). Acculturation and advertising communication strategies: a crosscultural study of Chinese and Americans. Psychology & Marketing, 10(5), 381–397. Lee, Y., Lee, I., Kim, J., & Kim, H. (2002). A cross-cultural study on the value structure of mobile internet usage: comparison between Korea and Japan. Journal of Electronic Commerce Research, 3, 227–239. Mahatanankoon, P. (2007). The effects of personality traits and optimum stimulation level on text-messaging activities and m-commerce intention. International Journal of Electronic Commerce, 12, 7–30. Martin, G. F., Sabogal, F., Martin, B. V. O., Otero-Sabogal, R., & Perez, E. Z. (1987). Development of a short acculturation scale for Hispanic-Americans. Hispanic Journal of Behavioral Sciences, 9, 183–205. Miyazaki, A. D., Lassar, W. M., & Taylor, K. A. (2007). Hispanic vs. Non-Hispanic response to online self-service tasks: Implications for perceived quality and patronage intentions. Journal of Service Marketing, 21, 520–529.

Downloaded by [Nova Southeastern University] at 17:34 10 September 2015

124

P. Korgaonkar et al.

Mort, G. S., & Drennan, J. (2007). Mobile communications: a study of factors influencing consumer use of m-services. Journal of Advertising Research, 47, 302–312. Muthitacharoen, A., & Palvia, P. (2002). B2C Internet commerce: A tale of two nations. Journal of Electronic Commerce Research, 3, 201–212. Noriega, J., & Blair, E. (2008). Advertising to bilinguals: Does the language of advertising influence the nature of thoughts? Journal of Marketing, 72, 69–83. Nysveen, H., Pedersen, P. E., & Thorbjørnsen, H. (2005). Intentions to use mobile services: antecedents and cross-service comparisons. Journal of the Academy of Marketing Science, 33, 30–46. Ogden, D. T. (2005). Hispanic versus Anglo male dominance in purchase decisions. Journal of Product and Brand Management, 14, 98–105. Okazaki, S. (2008). Determinant factors of mobile-based word-of-mouth campaign referral among Japanese adolescents. Psychology and Marketing, 25, 714–731. Okazaki, S., & Barwise, P. (2011). Has the time finally come for the medium of the future? Research on mobile advertising. Journal of Advertising Research, 51, 59–71. Okazaki, S., & Hirose, M. (2009). Effects of displacement–reinforcement between traditional media, PC internet and mobile internet. A quasi-experiment in Japan. International Journal of Advertising, 28, 77–104. Palumbo, F. A., & Teich, I. (2005). Segmenting the U.S. Hispanic market based on level of acculturation. Journal of Promotion Management, 12(1), 151–173. Park, J. K., Yang, S. J., & Lehto, X. (2007). Adoption of mobile technologies for Chinese consumers. Journal of Electronic Commerce Research, 8, 196–206. Pavlou, P. A., & Chai, L. (2002). What drives electronic commerce across cultures? A cross-cultural empirical investigation of the theory of planned behavior. Journal of Electronic Commerce Research, 3, 240–253. Pew Research Center. (2010). Hispanic Trends Report. Retrieved from http://www. pewhispanic.org/census-2010/ Phinney, J. S. (1992). The multigroup ethnic measure: A new scale for use with diverse groups. Journal of Adolescent Research, 7, 156–176. Pollay, R. W., & Mittal, B. (1993). Here’s the beef: Factors, determinants and segments of consumer criticism of advertising. Journal of Marketing, 57, 99–114. Precourt, G. (2009). Editorial: the promise of mobile. Journal of Advertising Research, 49, 1–2. Schlosser, A. E., Shavitt, S., & Kanter, A. (1999). Survey of Internet users’ attitudes toward Internet advertising. Journal of Interactive Marketing, 13, 34–54. Sierra, J. J., Hyman, M. R., & Heiser, R. S. (2012). Ethnic identity in advertising: A review and meta-analysis. Journal of Promotion Management, 18(4), 489–513. Sierra, J. J., Hyman, M. R., & Torres, I. M. (2009). Using a model’s apparent ethnicity to influence viewer responses to print ads: A social identity theory perspective. Journal of Current Issues and Research in Advertising, 31(2), 41–66. Simmons. (2011). The 2011 Mobile Consumer Report. Retrieved from http://www. experian.com/assets/simmons-research/whitepapers/experian-simmons-2011mobile-consumer-report.pdf Singh, N., Baack, D., Kundu, S. K., & Hurtado, C. (2008). U.S. Hispanic consumer ecommerce preferences: expectations and attitudes toward web content. Journal of Electronic Commerce Research, 9, 162–175.

Downloaded by [Nova Southeastern University] at 17:34 10 September 2015

Hispanics and Mobile-Based Marketing Methods

125

Sison, M. (2008). Editorial: One size does not fit all or does it? Journal of Advertising Research, 48, 167. Singh, N., Baack, D., Pereira, A., & Baack, D. (2008). Culturally customizing websites for U.S. Hispanic online consumers. Journal of Advertising Research, 48, 224–234. Smith, A. (2011). American and their cell phones. Pew Internet and American Life Project (2011). Retrieved from http://www.pewinternet.org/ 2011/08/15/americans-and-their-cell-phones/ Sultan, F., & Rohm, A. (2008). How to market to Generation M(obile). MIT Sloan Management Review, 49, 35–41. Sultan, F., Rohm, A., & Gao, T. (2009). Factors influencing consumer acceptance of mobile marketing: a two-county study of youth markets. Journal of Interactive Marketing, 23, 308. Torres, I. M., & Briggs, E. (2007). Identification effects of advertising response. Journal of Advertising, 36, 97–108. Tsang, M. M., Ho, S.-C., & Liang, T.-P. (2004). Consumer attitudes toward mobile advertising: an empirical study. International Journal of Electronic Commerce, 8, 65–78. Ueltschy, L. C., & Krampf, R. F. (1997). The influence of acculturation on advertising effectiveness to the Hispanic market. Journal of Applied Business Research, 13, 87–101. Villarreal, R., & Peterson, R. A. (2008). Hispanic ethnicity and media behavior. Journal of Advertising Research, 48, 179–190. Villarreal, R., & Peterson, R. A. (2009). The concept and marketing implications of Hispanicness. Journal of Marketing Theory and Practice, 17, 303–316. Webster, C. (1992). Race and source effects in the Elaboration Likelihood Model. Journal of Advertising Research, 32, 54–62.