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Hispanic Dynamics
Holistic brand analysis reveals differences between Latinos and the general population.

The challenges of balancing retailer, manufacturer and consumer needs for a shopper-marketing program can be quite daunting in today’s highly fragmented media, channel and consumer mind-set. Add on top of that the intricacies of the US Hispanic retail environment, as well as the Hispanic shopper mindset, and the task of developing a Hispanic shopper program can feel ever more daunting — but it doesn’t need to be.

Marketers have an inherent challenge when considering Hispanic shopper initiatives. This challenge lies in assuming that the particular brand or category may have evolved, or behaves, differently with this target. Marketers are asking themselves: Should I be consistent with the general market in my approach to Hispanic shoppers, or should I deploy different strategies and tactics to address this unique demographic? The inherit conflict is one of relevance versus consistency, and deciding which approach to take is, perhaps, one of the more complex decisions a contemporary marketer must make.

A Latino brand analysis should consist of a balanced scorecard, which should be benchmarked against the general market. The analysis should not only include traditional brand-equity measures (awareness, usage, relevance, etc.) but more important, a channel audit (distribution, display activity, schematics, sales, etc.) and Hispanic shopper insights (purchase barriers, Hispanic basket items, shopping habits, etc.). By understanding points-of-differentiation between the general and Hispanic segments, marketers are in a better position to understand the points-of- inflection with the Latino shopper and develop unique strategies that address specific needs.

A Latino brand analysis can quickly reveal salient discrepancies in the Hispanic versus the general market. For example, you may discover that a “leading brand” in a particular category within the general market is a laggard with Hispanic consumers. The immediate implication could be that, as opposed to frequency and advocacy, your shopper objectives should be penetration and trial. Thus, the Hispanic shopper program would result in a series of diverging tactics within the purchase-cycle framework (e.g., store displays, sampling, education, retailer sell-in).

Once you benchmark your general-market brand audit to your Latino brand audit, you should be in a better place to begin the strategic planning process. If we were to apply the brand audit model to Corona, for example, we would observe a few interesting points:

• The brand means something different to Hispanics than to general-market consumers. This is very evident just by looking at their taglines: While the general-market positioning is “Vacation in a Bottle,” the Hispanic positioning is about celebrating their culture.

• Distribution is extremely strong in Hispanic independent channels. Needless to say, you cannot walk into a Hispanic bodega without Corona in the beer cooler or front barrel.

• Corona drinkers, like Hispanics in general, have a very high incidence of home socialization (due to multigenerational households and tightly knit social circles) and therefore will have more party shopping occasions.

So, given the above, we can determine that the Corona brand equity is not only evolved in the Hispanic market, but, more important, it has evolved uniquely to that market and requires shopper programs that diverge from mainstream programs.

panavista chartTherefore, it makes sense for the brand to pursue tie-ins with high-profile Hispanic media properties or high-end Hispanic music acts (like Mana or Golden Boy Promotions). The tactics may not vary significantly from those employed in the general market (e.g., exclusive content incentives, QR codes, SMS), but the platform upon which the shopper programs are presented to retailers and consumers is significantly different from the general market. Retailers know their shoppers, and Latino-driven platforms are a very effective way to gain retailer acceptance and generate Hispanic shopper excitement for a brand like Corona.

However, should your brand not have the benefit of a highly evolved marketplace position, you may want to start with a more basic approach. A good contrast to this thought process is Campbell’s Soup. This is a brand that is as American as apple pie and, more important, has a significantly different challenge in the Hispanic market relative to the general market.

A quick Latino brand audit offers us some revealing insights: 1) Condensed soups under-index in the Hispanic market; 2) Preparation is a barrier (Latinos are unaccustomed to preparing condensed soup); and 3) Retailers are aware of insights #1 and #2, so distribution is lacking in independent channels.

However, Latina shoppers are very open to soup solutions. For Latinos — particularly Mexicans — soup is a fundamental part of a sit-down meal. A typical Hispanic meal always begins with “la sopa.” So although there may be some preparation barriers, Latina shoppers and retailers would be very open to a soup solution platform that not only teaches shoppers how to prepare condensed soup, but also how to make it theirs. I personally would love a little lime and fresh cilantro on some Campbell’s chicken noodle soup.

If we apply the Latino brand audit to a brand such as Gillette and its razor systems, we would also find some interesting points-of-inflection for an overarching Hispanic shopper strategy. What is interesting about Gillette is that although it’s a global brand with global distribution and high awareness, its product line has evolved differently in the general market than in the Hispanic market. In the Hispanic market, razors with cartridge systems under-index to the general market while disposable razors over-index. By conducting a Latino brand analysis, some contrasting themes come up:

• Retailers are not willing to push systems with Hispanics as much as they are willing to push disposable razors.

• The significant price differential between disposables and systems razors poses challenging value barriers for Hispanic consumers.

• Hispanic males tend to be more actively involved in the blade-shopping process, yet are experiential shoppers who are part of the family trip.

We know from several studies — including Univision’s study “Why Latinos look so good” — that Latino males are very concerned about personal grooming. Therefore, male Latino shoppers are open to products that will make them look good as long as they understand the value proposition. Given that the price differential from a disposable to a cartridge is significant, the education process to address shopper barriers would be fairly involved. Value, if defined as what one pays divided by what one gets, can take on multiple dimensions when it comes to the razor category. Marketers have several benefits they can tap into, such as blade longevity, skin irritation, close shave, facial hair grooming, and so forth.

If Gillette did not recognize the unique dynamics of the razor category with Hispanics, it would focus its efforts on getting Hispanic males to switch from an older system to a newer system as opposed to converting them from a disposable to a system. This is analogous to getting consumers from a 2011 Lexus to a 2013 Lexus as opposed to getting them from 2012 Camry to a 2013 Lexus — very different, right? These implications boil down to what’s parked at the dealership or, in this case, which razors are featured on the shelf. Therefore, although retailers may want to increase basket ring and margins by selling higher-end cartridge systems, they first need to believe consumers will buy into the retail proposition.

Latino shopping patterns are different, and among the more salient characteristics is their collective shopping behavior (they shop as a group or family). Within this dynamic resides an interesting shopper insight: Dads sometime “go off on their own” during the shopping trip. It would be very interesting, therefore, for system-blade manufacturers to give Dad a free shave while “mom goes and does the shopping.” This retail-tainment strategy would be a great way to address the significant trade-up barriers from disposable to system through trial, while also educating the consumer on the numerous benefits of a higher-value razor blade. There would be nothing more that a car salesman would want than to have you relaxed in the car seat of the new Lexus to “close the deal.”

Your Hispanic shopper strategy may require a significantly different approach, an adaptation of general-market tactics or a mix of both. Don’t assume that a translation or adaptation will do the job, particularly when it comes to the shopper mindset that’s a false positive waiting to happen. Otherwise, you may think you are selling razor cartridges to a consumer who understands cartridges … or condensed soup to an avid soup consumer who does not know how to make condensed soup … or selling “beach beer” to a consumer who really values social gatherings.

At more than 18 percent of the US population, and with more than $1 trillion in spending power, the opportunity for growth in consumer packaged goods lies in the hearts, and wallets, of the Latino shopper.


roberto
ROBERTO SIEWCZYNSKI is evp of strategy and business development for PanaVista, with expertise across the Hispanic path to purchase. Roberto can be reached at rsiewczynski-@-panavistapromo.com.


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