Given the current state of the economy, influencing grocery shoppers has never been more critical for consumer packaged goods (CPG) marketers.
As CPG and retail companies vie for consumer loyalty and increased share, Univision and AMG Strategic Advisors, part of Acosta Sales & Marketing, have published insights from new research, entitled "The Why? Behind the Buy–Hispanic." This research shows how and why Hispanic consumers, with their $1 trillion-plus buying power, are a vital target for CPG and retail brands because of their unparalleled spending and shopping attitudes.
The value of Hispanic consumers to CPG marketers bears repeating: Not only are Hispanics the fastest growing population group--Hispanics will contribute more than 60 percent of all population growth over the next five years--but, more important, Hispanics make up a $1.2 trillion economy that rivals consumer expenditures of Russia and Mexico, and their disposable income is projected to more than double by 2020. Because of these staggering growth figures, every dollar invested in the Hispanic consumer is a dollar directly invested in your brand’s growth.
Let’s review some noteworthy takeaways from our study.
Hispanics Spend More
Marketers may be surprised to learn that there are distinct differences in spending habits for the Hispanic consumer versus the total U.S. population. For example, no matter what the household’s income level, Hispanics spend slightly more than the total U.S. population. And in fact, for the more affluent groups of $75,000 or more in household income, we see differentials between the two consumers in the range of $40 to $50 a month. These differences add up.
Plus, these differences translate when it comes to individual shopping trips. To illustrate this, we see that Hispanic shoppers spend significantly more per stock-up shopping trip, $128 versus the average U.S. consumers’ $117. We also found that Hispanics shop more often than the general population. Certainly, Hispanics have larger households and more children than the non-Hispanic population, which could impact this data, but the underlying takeaway is this: Hispanics are spending more on grocery trips versus the total U.S. population.
Hispanics Are More Optimistic About Their Situations
Interestingly, it seems as though this level of spending, even in challenging economic times for most Americans, is grounded in a distinct level of optimism among Hispanic consumers. There are substantial differences between the Hispanic shopper and the total U.S. population in how they view the potential for positive change in employment and household income. In the coming year, significantly more Hispanic shoppers (32 percent) indicated they expected an increase in their household incomes than the total for U.S. shoppers (22 percent).
Love Brands And Value Quality
The optimism that Hispanic consumers harbor even in these difficult times is also supported by the fact that 40 percent of Hispanics say they buy higher quality nongrocery products that they know will last them longer (vs. just 27 percent of total U.S. shoppers). And they also are willing to trade off: Thirty-nine percent buy less expensive brands in one category for more expensive brands in another category (vs. just 27 percent of total U.S.). These data points are particularly poignant because they really reflect how a strong cultural inclination affects buying behaviors. In Hispanic culture, there is a saying ingrained in so many of us growing up: “Lo barato sale caro”--“What starts off cheap will ultimately end up costing you even more.” In other words, you get what you pay for, and you can see this cultural attitude supported in empirical data.
Incremental Holidays = Incremental Shopping Occasions
As we’ve already outlined, Hispanic consumers are a prime grocery target for a lot of reasons, but perhaps one of the most important is in the event of holidays and special occasions. Not only do half of Hispanics celebrate the same U.S. national holidays and family events as most Americans do with special meals, but they also celebrate native religious and Hispanic holidays by gathering their families together. So they are adding incremental special events to the calendar versus their non-Hispanic counterparts, giving them that many more special meals for which they need to shop and prepare their homes.
Digital Tools Aren’t Just For Social And Entertainment
We know that Hispanics overindex on smartphone penetration, they spend more on their phone bills, and they like to be connected more than the general population. So it is no surprise that nearly three in four Hispanic shoppers are using technology tools as part of their grocery shopping process--26 percent more than the total U.S. population. Certainly we know that Hispanic consumers love using their smartphones and connected devices for entertainment, digital video, and social media, but this tells us they are leveraging their devices for grocery shopping, as well.
This use of interactive tools extends to blogs, email offers, online shopping lists, and recipes. Notably, on digital behaviors, Hispanics lag behind the total U.S. population only in the use of online coupons, but on all other behaviors Hispanics are at the mainstream or, in many cases, ahead of the curve when it comes to using tech tools to improve their shopping experiences.
- 18 percent sign up to get future emails from a brand, manufacturer, or store (vs. 17 percent of the total population).
- 17 percent sign up online for brand- or store-run sweepstakes, contests, or games (vs. 15 percent of the total population).
- 15 percent of Hispanic consumers visit a brand’s Web site to learn more about products or deals–significantly higher than 11 percent of the total U.S. population.
- 14 percent of Hispanics use their computers or smartphones to compare prices of specific products, which is significantly higher than just 9 percent of the general population consumer.
Planning Ahead And Making Lists Means Room For Influence
Among the biggest surprises revealed by this research was the insight that Hispanic shoppers are more likely to plan meals ahead of time and make shopping lists than we’d seen in prior research and through anecdotal experience. Hispanics take their meal planning seriously, with six in 10 planning their meals at least a day or two in advance. And we see the biggest difference between Hispanics and the total U.S. population is that that there are significantly fewer Hispanics planning a meal the day of. Seventy-six percent of Hispanic shoppers make a shopping list--still less than the total U.S. population, but much higher than we would have anticipated. And when they do make lists, Hispanics are sure to list specific brands on those lists, giving marketers a chance to shape their meal planning before they even get to the store.