Hispanics – A demographic retailers can’t ignore

Discussion
Mar 11, 2014

Through a special arrangement, what follows is an excerpt of an article from WayfinD, a quarterly e-magazine filled with insights, trends and predictions from the retail and foodservice experts at WD Partners.

In the recent shopper study, "Amazon Can’t Do That — Consumer Desire and the Store of the Future," a key finding was Hispanic consumers’ strong preference for community-driven environments and emotionally satisfying in-store experiences.

As the Hispanic population expands from 17 percent of the country’s total in 2012 to a projected 31 percent by 2060, such insights will be crucial for retailers to attract and gain the loyalty of Hispanic shoppers.

Four key ideas to consider:

1. Take a field trip.
Executives at mass-market neighborhood chains could learn a thing or two by visiting their Hispanic grocer. Color. Music. Beautiful displays of produce and flags of the world. This is a shopping experience not only bold in emotion and energy, but rich in human connection and top-rate customer service. Mass-market retailers need to step it up.

2. Be ready to build a relationship.
This is where strong customer service comes into play. Focus on winning their hearts and minds. Be prepared to answer questions and slowly build the sale. "Latinos interact in a more personal manner," Juan Tornoe of Cultural Strategies told The New York Times recently. "We want to be recognized as a person. Connect with me on a personal level before you start selling me."

3. Engage in social media.
There are more than 33 million U.S. Hispanic internet users, and more than half of them use mobile devices to access the web. According to a 2012 study by Experian Simmons, Hispanic consumers were more likely than non-Hispanics to use social network sites to learn about companies and products they like — as well as purchase products seen on them, and post ratings or reviews for others to see.

4. Understand the cultural differences between Latinos.
Think all Hispanics love soccer? Many Puerto Ricans prefer baseball and basketball. Be sure to understand the composition of local Latino markets and adjust messages and campaigns accordingly. While it’s true that Mexican Americans represent the highest number of Latinos in the U.S. (around 65 percent), large pockets of Hondurans and other nationalities should not be overlooked. Be aware of individual national holidays and other opportunities for promotions that draw them into your store.

5. Create dynamic, social spaces.
A major takeaway from the Amazon study is as applicable to Hispanic consumers (maybe more so) as the U.S. population at large: environments that encourage engagement will be a place customers want to visit again and again. Encourage customers to touch and learn about new products. Stylize your associates’ wardrobes so they’re easy to identify when wanting to start a conversation. Create that "third space" where people want to spend time away from home.

How should stores be adjusting to meet the needs of the country’s fast-growing Hispanic population? What’s the best way to learn what changes may or may not be necessary? What notable or surprising changes may be ahead for retail marketing and in-store strategies?

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18 Comments on "Hispanics – A demographic retailers can’t ignore"

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Bob Phibbs
Guest
3 years 9 months ago

I would say that whether you’re Caucasian or Hispanic, or any nationality, people do want to have a relationship. Customers do want to feel part of a community that cares. And in an increasingly impersonal world — the one big data is promising — people do want to be seen as a person first.

Paula Rosenblum
Guest
3 years 9 months ago
Here’s problem #1 – not all Hispanics are the same. I’ve sat and listened to people talk about “The Hispanic Market” at several different events over the past 3 years. I’ve also looked at clothing assortments tailored to “The Hispanic Market.” I live in South Florida and grew up in New York, so I can speak fairly objectively about this. Not all Hispanics are the same. It’s like saying “How can we cater to the Caucasian market?” We’d roll our eyes if someone asked us that. So, there are really multiple questions here: How can we cater to the Puerto… Read more »
Joan Treistman
Guest
3 years 9 months ago
“Think globally but act locally.” That’s the essence of what this article tells us. While retailers must recognize the growing Hispanic population, they must be sensitive to cultural differences within this segment. Lee recommends visiting Hispanic grocery stores. However, I suggest that retailers will better understand the opportunities for building relationships among Hispanics when they visit their homes and experience how they live and what they desire for themselves and their families. Visiting other stores can lead to copycat behavior. Spending time in the homes of consumers encourages independent creativity in the development of new strategies and tactics. We want… Read more »
Tom Redd
Guest
3 years 9 months ago
Well, if you lived in AZ — near me — you would probably move away. Wait, back on track…what I meant to say is that in AZ retailers are way ahead of this study. Most shoppers don’t wait for all the studies and research that we seem to have done in retail. No, they just shop. We all know how Macy’s drove their regional merchandise assortment programs and that the AZ store are not anything like the MN stores — especially in the interior “image.” Here in AZ, we are seeing more of the larger food chains expand their food… Read more »
Bill Davis
Guest
3 years 9 months ago
If a retailer is interested in targeting the Latino community, they need to take the time to learn about and better understand their needs and wants. The Hispanic community is strong and growing in the US so for retailers to not focus on this market, especially those with operations in the southern half of the country, would be a mistake. One company that appears to be doing an exceptional job here is The Legaspi Company which was recently recognized by Fast Company as one of the most innovative companies in retail. If retailers aren’t sure how to proceed, benchmarking against… Read more »
Mark Price
Guest
3 years 9 months ago

While there are clear differences in shopping patterns between Hispanic consumers and the more general market, it’s important to recognize that Hispanic consumers not only differentiate by nationality, but also by level of acculturation as well. Hispanic consumers who are second and third generation Americans begin to resemble the general market more and more in their behavior.

At the same time, specific approaches, strategies and design elements will always have additional appeal to this marketplace.

Kelly Tackett
Guest
3 years 9 months ago

Having done loads of qualitative research with Hispanic consumers, I would agree that most retailers get caught up in the “oh we need to have a Hispanic strategy” without really taking the time to understand the consumer.

Just look at a few of the characteristics retailers should consider when focusing on the US Hispanic market: country of origin; language of choice; first-, second- or third-generation; bi-cultural vs. multi-cultural vs.Hispanic-only; and level of/interest in acculturation.

Definitely doesn’t lend itself to a one size fits all solution!

Richard J. George, Ph.D.
Guest
3 years 9 months ago
These findings should not be a surprise; instead a wake up call for all retailers. People like to shop in fun, engaging environments and people like to be recognized and engaged, not sold. Ironically, these two maxims are not limited to Hispanic shoppers. People like to shop. Take a look at boutique retailers and even QVC, where excitement and interaction abound. They don’t like to shop in boring stores in which they don’t feel appreciated. Ironically, the sensory experience is one bricks and mortar retail advantage Amazon has not pursued (at least not yet). The lessons from the WD Partners… Read more »
MARIA PEREZ
Guest
MARIA PEREZ
3 years 9 months ago
The most important aspect is to be educated and learn more about Latin cultures and what makes each of them unique. One of my biggest pet peeves is the confusion I constantly see. For example, usually Americans think all things Mexican are the same for all Latins and and all things Latin are Spanish, from Spain. Mexico as well as all Latin countries, have their own music, for example, but whenever a Mexican thing is advertised or referred to, Spanish music is always used. I am a Puerto Rican raised in Puerto Rico with a lot of exposure to American… Read more »
Li McClelland
Guest
Li McClelland
3 years 9 months ago

I feel the same about “the Hispanic market” as I do talk about “the women’s market,” “the boomer market,” “the gay market,” or “the millennial market.” There is no such thing, because each group is made up of individuals with widely varying interests, needs, incomes, educational levels and expectations. Let’s focus on the all encompassing American market and on in-store, on-line customer service while acknowledging that ethnic food products and textiles (for example) increasingly hold interest for a broad section of melting pot America.

Mark Burr
Guest
3 years 9 months ago

If I could say it better than “Liatt,” I’d attempt it, but I won’t repeat what is just right for the topic!

Ralph Jacobson
Guest
3 years 9 months ago
There is nothing new here. Traditional format stores have struggled to capture significant share of this consumer group for decades. Three words can make this mystery crystal-clear: 1. Community, 2. Community, 3. Community. Almost 20 years ago, Pfizer Pharmaceuticals installed freestanding kiosks in a few dozen Hispanic churches in Los Angeles. The kiosks offered internet access to those families who needed it. Ads on the kiosks drove revenue through the roof on promoted products. Pfizer is smart enough to know how to reach that demographic. There are many other ways and channels by which to reach these people, however, the… Read more »
M. Jericho Banks PhD
Guest
M. Jericho Banks PhD
3 years 9 months ago
If this were not an important topic, we wouldn’t revisit it over and over (and over) through the years. In the early 80s I was a member of the Kroger taskforce for Hispanic marketing. In the mid-80s, same deal with Safeway. And, I’m sure there were taskforces that predated my involvement. We always reached the same conclusions, and today’s discussion could be a time capsule from way back when. Nothing new. And that’s a good thing, because it underscores the constant threads of truth woven through the tapestry of Hispanic Marketing. I do have one recommendation that may be new… Read more »
Roberto Siewczynski
Guest
Roberto Siewczynski
3 years 9 months ago

All of our proprietary research shows that Hispanic shoppers behave differently throughout the purchase cycle.They shop as a family, they make more decisions in store, have higher trip frequency, give importance to freshness, and yearn for that “authentic Hispanic” store (with my brands). Successful Hispanic retailers (Vallartas, Sedanos, Publix, Cardenas, Mi Pueblo, etc.) cater to these behaviors and are very effective at capturing the hearts and wallets of this target. This is the new majority in places like California, Texas and Florida. If you need to grow you can only grow by focusing your efforts were the growth is. 🙂

Mike Osorio
Guest
Mike Osorio
3 years 9 months ago

The key points of understanding and optimizing the various segments of the “Hispanic” market, as well as creating human, engaging experiences, are basic fundamentals of today’s retail environment. These same points are applicable on attracting Gen Y overall, and in reacting to the various segments of the “Asian” market, and other core ethnicities – even white America! Finally, as the various Hispanic segments continue to grow, they influence all consumers via popular music, sports, and other references, meaning that a much higher percentage will behave in a similar way.

Jerry Gelsomino
Guest
3 years 9 months ago

I can’t speak to how the U.S. changed in the 6 years of my absence (I’m returning for good this Summer), but I’ll share my experience of moving from Southern California to Indiana in 2005. I and my family missed the strong Hispanic culture, and felt Indiana was rather bland; hard working, nice people, but devoid of outward shows of passion. Of course LA is a great mixing bowl of culture, but the authentic Mexican restaurants, grocers and festivals add a patina to the mosaic. I hope retailers are now focusing more on this demographic.

Tom Borg
Guest
Tom Borg
3 years 8 months ago

If you are the owner or in management of a company and want to develop a greater number of Hispanic clients, you must first open up your mind. Treat people the way they want to be treated, not just the way that is most efficient and convenient for your company to serve customers.

Perform your own Hispanic focus groups with the help of an outside facilitator. You will get honest answers and ideas that will set you apart from your competitors. Test the ideas out and stick with the ones that work.

Peter Askew
Guest
Peter Askew
3 years 8 months ago

In addition to understanding levels of acculturation, language preferences, complexity of cultural identity (i.e. bi-cultural, multi-cultural), it is also critical to understand the connection between generations and their cultural self-identification as this can certainly impact in-store expectations and behavior.

Millennials will have a different connection to their ‘American’ vs. ‘Latino’ side than their parents or grandparents. So how this translates into a store environment and how this differs by category, brands, area of store, etc, would need to be taken into consideration.

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