The Census Report

American Demographics, Jan 1, 2002

Census 2000 is certainly not what consumers will be thinking about the next time they browse the greeting card aisle. But the census did play a part in what consumers will see on the racks this year. Hallmark, the greeting card giant, based in Kansas City, Mo., uses census data to decide on the product mix that local retailers receive. When combined with psychographic research, such data provides Hallmark with a powerful marketing tool, says Jay Dittmann, the firm's vice president of consumer research. "It is our key lens into the demographics of the population," he says.

Last year, for instance when the first set of Census 2000 statistics began to trickle out, the company increased its focus on its "en Español" line, given the projections of a rapidly growing Hispanic population. Hallmark first used online focus groups to create new messages for the "en Español" line - and then turned to census data to pick the right retail markets to target. It also launched its youth-focused "Fresh Ink" line, using census data to pick markets with the right age composition.

That's just the beginning. Hallmark executives, like other marketers, have two more years of census 2000 figures to look forward to. Basic population counts, information about race, ethnicity, age and household composition were released last year, but some of the most valuable facts for marketers from the census are still to come - such as data on household income for each community in the U.S. That's just the type of information KitchenAid, the upscale appliance manufacturer, is waiting for to target high-income consumers, says Brian Maynard, the company's director of integrated marketing. Meanwhile, Educational Testing Services, the firm that administers the SAT among other exams, is awaiting census stats on the share of adults that have bachelor's degrees - so it can decide where to place new testing centers, says Rick Fry, senior research scientist at the Princeton, N.J.-based concern.

The wait for numbers on income, education and many other consumer characteristics will be over by the end of this year. First, in the early part of the year, details on racial and ethnic groups will be released, explaining how age and household arrangements vary by race and ethnicity - a boon to marketers beefing up their ethnic marketing plans. Over the summer, some of the most valuable information for businesses will make its first appearance when data from the census long-form is finally released.

The long-form was completed by 1 in every 6 U.S. households, and included more than 50 questions on a wide range of social, economic and occupational characteristics. The survey will provide the first update in a decade on a variety of questions, such as, how many consumers speak a language other than English at home? How many people are taking care of their own grandchildren? And who is living in apartments versus houses, mobile homes or other structures? The first release of long-form stats will be called "Summary File 3" or "SF 3." A few months later, in the fall of 2002, the bureau will make public long-form data for detailed racial and ethnic groups. That release will be called "Summary File 4" or "SF 4," and the information will be released slowly, concluding in February of 2003.

While there's still much to look forward to from the Census Bureau, a lot is already known about how the consumer market changed over the past decade. Here's a look at what businesses have learned from Census 2000 to date.

THE FASTEST GROWING CONSUMER MARKET IN HISTORY

The U.S. population grew at a historic pace between 1990 and 2000, creating an enormous market for businesses to target. Over the past 10 years, the population exploded by 32.7 million people to 281 million, an increase of 13.2 percent. This represents the largest increase in the consumer market since the start of the Baby Boom. (Between 1950 and 1960, Boomer births boosted the population by 28 million people.) The population explosion of the 1990s took demographers by surprise. After three decades of slowing growth, most experts anticipated that the U.S. population would continue that trend. Creating the shock wave: larger than expected and larger than measured numbers of immigrants, both legal and illegal.

THE WEST IS ONE

This fast-growing consumer market was not distributed evenly throughout the nation. Although every state experienced some population growth - the only time in the 20th century that this happened - growth rates ranged from a staggering 66 percent in Nevada to less than 1 percent in North Dakota.

Where are the fastest growing consumer markets? Follow the sun. States in the West and in the South grew the most over the past decade, with the West leading the way: the region's population grew by 19.7 percent between 1990 and 2000. The second fastest growing region was the South, which experienced a 17.3 percent increase. The slowest growth was experienced by the Northeast, which grew by just 5.5 percent over the past 10 years, followed by the Midwest, which increased by 7.9 percent. Although the fastest growing consumer markets will still be found in the West and South over the next 10 years, smaller states in the region will see the largest rates of population growth. While many states in the South and the West posted impressive growth numbers between 1990 and 2000, their population growth engines are starting to slow down. For example, California grew by 4 million people between 1990 and 2000, an increase of about 14 percent. But between 1980 and 1990, the state grew by 26 percent. Florida also seems to be losing steam: Although the state grew by 24 percent over the past decade, it grew by 33 percent during the 1980s.