The mass (Walmart and Target) and club (Costco and Sam’s) retail channels have a profound effect on shoppers in terms of overall behavior. According to the results of the recent CatapultVista ‘NVista quantitative study, marketers can leverage these channels to better reach Hispanic shoppers.
The study, which included more than 3,800 Hispanic and 500 non-Hispanic shoppers, analyzed Hispanic shopping habits including:
- Where Latinos shop;
- How much they spend; and
- Where they buy, broken out by acculturation and benchmarked against general market shoppers.
One of the most interesting findings was the quantity of purchases at the national level for mass and club. Manufacturers should take notice. If you’re a national manufacturer that does a significant amount of business with these retailers, you may need to rethink your approach to target the Hispanic shopper.
A strong case can be made for the importance of the grocery channel with this consumer segment, but if you want to ramp up sales and attain economies of scale, you need to go big and think nationally.
Although the numbers skew much higher in major urban centers such as Los Angeles, Miami and Dallas, when viewed through a national lens, Hispanics qualify as a niche market, making up roughly 17% of the U.S. population.
Hispanic-targeted shopper programs on a per-store basis can be significantly more costly than those of the general market, given their smaller population segment and similar fixed cost structure. But if you take a large national retailer like Walmart and apply our 17% figure, you come away with solid numbers. It’s no longer a 17% slice of a market that might represent one-tenth of your volume, but 17% of your total volume.
Moreover, if you know Hispanic shoppers over-index in your store (e.g. our survey found that 79% of Hispanics shopped at Walmart versus 73% of non-Hispanics), then it makes sense to invest more of your dollars developing targeted Hispanic programs. So if you assume that the majority of foot traffic for 17% of Walmart’s 4,281 U.S. stores is Hispanic, this equates to over 700 stores, which is no longer a “small” shopper program.
Manufacturers that want to attain scale and make a pronounced impact with this market should first consider large national chains and develop a custom program for Hispanic-targeted stores. Start by looking at the data in these stores, such as category, brand, and SKU data. Then determine if there are notable distinctions that require a different approach for this market.
Grocery buying among Hispanic shoppers at mass and club is far more substantial than marketers may realize and is a trend that will continue to grow. If you’re planning shopper marketing campaigns tailored for this segment, there are enticing economies of scale by ensuring that Walmart, Target, Costco and Sam’s fill your shopping list.