Are Big Retailers Being Smart About How They Expand Their Hispanic Marketing Strategies?

Jan 06, 2005

Editorial by Terry Soto

A recent article on highlights steps that large retailers like IKEA, Circuit City, Target, Home Depot and JC Penney are taking to adjust their Hispanic marketing programs, as well as their attitudes.

Many are reportedly digging deeper into research to help them understand trading areas and identify stores that can be designated as Hispanic as a way to make decisions about:

  • Increasing ad budgets to target Hispanics;

  • Developing bilingual signage and collateral;

  • Hiring more Spanish-speaking staff; and

  • Adapting merchandise assortment.

Unfortunately, its doubtful that consumers will see these steps implemented well because retailers are mostly planning and executing on a tactical level, rather than making corporate-wide strategy shifts in their own culture. This results in department-driven, rather corporate-driven, initiatives. Consequently, the required corporate reorganization, that would ensure operational soundness in the way retailers go to the multicultural marketplace, is overlooked.

This lack of strategic focus impacts implementation of each of the steps mentioned above:

  • If stores are not “walking the operational walk,” increasing the volume on the “talk” will only highlight their weaknesses, as consumers see no evidence that retailers are catering to Spanish-speaking Hispanics.  Retailers should take care in ensuring that their selling proposition can be delivered at store level seamlessly and with the same quality as that delivered to English-speaking customers.

  • The idea of bilingual signage and collateral only works if the company, not just the department or local stores, is committed to communicating to Hispanics in Spanish.  This is a decision with repercussions on many levels and is not one that should be taken unless it is a corporate directive. Operationally, bilingual signage and collateral budgets must be on par with store requirements or as experience has shown, several situations will be encountered:

    • The materials will result in direct translations of mainstream messages.

    • They will feature products and services that are mainstream aligned rather than target market focused.

    • Limited or “Hispanic” budgets will affect production quality, and quantities made available to stores will be insufficient. Stores will constantly run out of Spanish-language materials or, worse, stores will make decisions not to display Spanish-language brochures as freely as English-language versions because they want to give them out “selectively.”

    • Signage and collateral will be absent from stores altogether because the ordering, distribution and shipping mechanisms will be different from those of mainstream materials. Treating these materials separately creates yet another piece of information retailers need to know and complicates rather than facilitates access.

    • Whether Bilingual signage will be posted will be decided by a store director based on his judgment because Spanish-language materials are often not considered in regular and seasonal merchandising plans/schematics for Hispanic designated stores.

  • Hiring more Hispanic employees sounds good on the surface, but unless it is a company-wide HR priority, it will happen haphazardly. HR culture must shift in order to ensure that hiring practices take into account place of birth, nationality, Spanish-language proficiency, and Spanish-language training. Many companies are hiring Hispanics by the dozen, but are hiring people who can’t speak enough Spanish to engage the consumer in a conversation, much less motivate them to buy.  Worse, English-dominant Hispanics, often U.S. born, are indifferent to the immigrant mindset and are often frustrated by the added time required to assist Spanish-speakers.  Retailers must be able to assess the suitability of the Hispanics they hire in order to truly implement on this level.

  • Adapting merchandising assortment goes beyond items; it also touches upon merchandising, sizes, colors and how the items are priced.  It also implies that advertising, bilingual signage/collateral, and bilingual employees highlight the assortment and its advantages.

Experience has shown that, unless multicultural marketing efforts are implemented properly at all levels of the organization, the consumer will not see results in the intended
manner and the investment will yield a less than optimal return.  However, of greater concern, should be the possibility of arriving at the wrong conclusion — that consumers
were unaffected by the efforts when, in fact, the problem or the opportunity was much broader than that.

Moderator’s Comment: Why is multicultural marketing such a challenge for retailers in spite of good intentions?
Terry Soto – Moderator

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