Merchandising Features / Packaging / Retailer Features / Trend Features / Product Development

The ethnic market at home

March 29, 2012
/ Print / Reprints /
ShareMore
/ Text Size+

Most marketers and manufacturers have a sense that the U.S. Hispanic market is on the rise.  This phenomenon has been happening in a major way for the last 25 years.



While opportunities exist across the globe to sell private label products, don't forget the largest ethnic market in the States, Hispanics

Most marketers and manufacturers have a sense that the U.S. Hispanic market is on the rise.  This phenomenon has been happening in a major way for the last 25 years. The U.S. Census serves  as a barometer of this growth and despite the high expectations, we are consistently surprised at how fast the market is moving.
For example:
• 54 percent of ALL population growth in the United States came from Hispanics from 2000 to 2010.
• One out of every four births in the United States is Hispanic.
• One out of six people in the United States is Hispanic.
• Hispanics are growing increasingly in non-traditional markets like Tennessee, North Carolina, Georgia and Nevada.
• Looking forward, the Hispanic market will be one of the fastest growing population segments in the United States, reaching 30 percent of the country, or 100+ million consumers, within the next 30 years.  How should a private label manufacturer react?
Understand which categories are “must win” with Hispanics:
1. Youth and Kids.  Anything that you make or sell that relates to kids – diapers, toys, vitamins, clothes, educational materials, school supplies, etc. One way to think about it is – if you have a youth product/service, you have a Hispanic product/service de facto.
2. Food/Beverage – Hispanics over-index on average basket size and number of store visits in general, but this is often driven by the food and beverage categories.  With larger households, a collectivist perspective and for many, a well-defined behavior of purchasing based on immediate needs (vs. stocking up), Hispanics are going to be in your stores more often than other consumers.  Do you have the right flavor profiles?  Mandarin, Mango, Dulce de Leche, Chipolte are just a few flavors that are Hispanic inspired yet appealing to the non-Hispanic palate.  
3. Beauty – Latinas over-index on beauty products. Hair care, skin care, fragrances and other category products are key to Latina lifestyles. Even in times of recession, as seen in 2009 research, Latinas are less likely to give up on the beauty category. 
UNDERSTAND CULTURAL BEST PRACTICES
With the great influx of Hispanics in the United States, the marketing/sales world has responded by creating infrastructure relevant to serving them. Syndicated research companies like Neilson, NPD and Simmons have specialized data cuts that can inform manufacturers where opportunity lies.  Specialized marketing agencies like Impremedia have created Hispanic programs that facilitate sampling, DMA specific marketing and retail programs.  Hispanic advertising agencies are abundant, offering traditional branding, advertising, direct marketing and digital strategies (www.AHAA.org).  Many retailers, certainly the larger national chains and the super-regionals, have Hispanic-specific store formats, micro-merchandising strategies and service levels to serve the market.  Walmart, Target, Kroger, Walgreens, H-E-B, Publix and others have grown more and more sophisticated in their ability to define and target Hispanics.  Of course, urban-based independents and bodegas make much of their living here.
One important, and often overlooked, best practice relates to the design and positioning of Hispanic products.  This practice, quite simply, is to create a product that is appealing to Hispanics on a deeper cultural level, while still appealing beyond the Hispanic consumer.  Thinking ahead, creating a value proposition that meets this criteria is where the biggest opportunity lies. 
Where does this exist?  Increasingly, everywhere.  McDonald’s mango pineapple smoothies,  Dora the Explorer, Shakira, and many more popular culture reference points are not only appealing to Hispanics, but non-Hispanics as well.  U.S. consumers are getting in touch with their inner Latino.  Understanding this dynamic can be a profitable endeavor. PLB
Stephen Palacios, executive vice president, joined retail consulting firm Cheskin in 2001 to lead the creation and growth of Cheskin’s New York City office. He currently oversees the company’s client accounts for all non-technology business and leads Cheskin’s Hispanic market practice group.

Did you enjoy this article? Click here to subscribe to Private Label Buyer.

You must login or register in order to post a comment.

Multimedia

Videos

Image Galleries

August 2014 New Food Products

This month’s new food products are organic coffee, hatch green chili tzatziki, cultured soy, kernel cooking oils, snack seasoning, thin Swiss cheese, tea and lemonade blend, crispy fish shapes, mole rojo braising sauce, sausage & cheese pita pocket, and chicken club pizza.

Podcasts

Coming with a clear, comprehensive plan was the key to success for Longo Brothers Fruit Markets when the grocer decided to roll out a two-tier private label strategy, Jenny Longo and Robert Koss tell PLBuyer editor Chris Freeman in this podcast.

More Podcasts

Private Label Buyer Magazine

PLB August 2014 cover

August 2014

The August 2014 issue of Private Label Buyer includes articles on non-food grocery items, as well as category insights on store brand spreads, healthcare, and personal care. Check it out today!

Table Of Contents Subscribe

Private Label Segments

Which segment of private label will see the biggest growth over the next year?
View Results Poll Archive

Clear Seas Research

Clear Seas ResearchWith access to over one million professionals and more than 60 industry-specific publications,Clear Seas Research offers relevant insights from those who know your industry best. Let us customize a market research solution that exceeds your marketing goals.

PLB Marketplace

STAY CONNECTED

facebook_40px twitter_40px  youtube_40pxlinkedin_40pxgoogle+ icon 40px