Attracting Hispanic consumers requires effort by businesses
Iris Ramirez Reese made a promise to right a wrong after she asked a Food Lion employee where she could find traditional Puerto Rican seasoning and sodas.
“They directed me to the Taco Bell box, and they were calling it the Spanish food section,” said Ramirez Reese, who owns Fusion Multicultural Marketing & Communications, a Durham, N.C., firm that focuses on the changing cultural marketing landscape. “So I made a conscious decision that I need to help this company to bring my food here, my products here.”
That was 1998, a year after Ramirez Reese, who was the first in her Puerto Rican family born on the U.S. mainland, and her husband moved to Durham from New York, where she was raised by her parents and grandparents.
In 1999, Ramirez Reese, who at the time owned La Conexion Latina, an interpretation and translation services company, shared her concerns with local Food Lion officials. They contracted with her to help bring in authentic products, create internal procedures and take other steps to attract and retain the local Hispanic market.
“We did 16 cities in 16 weeks,” Ramirez Reese said. “Then they contracted me again to come in and help them train their associates.”
She then went to Food Lions from North Carolina up the East Coast to help stores match their demographics with its food.
Ramirez Reese's company and efforts highlight two important markets — Latino consumers and Hispanic-owned businesses — that communities and small-business owners need to pay attention to, she and other experts said.
Latino consumers are part of the fastest-growing ethnic segment, according to a 2012 report on Hispanic consumers from Nielsen, which provides information and insight on consumer activity. According to the report, the Hispanic segment is expected to increase 167 percent from 2010 to 2050, compared to 42 percent for the total population.
“The Hispanic market's size, growing clout, and buying power of $1 trillion in 2010 and $1.5 trillion by 2015 require thoughtful understanding about what the market represents to a company's bottom line,” the report states.
The number of Hispanic-owned businesses is also rapidly increasing, providing jobs and driving economies in communities across the nation.
From 2002 to 2007, the number of Hispanic-owned businesses grew from 1.57 million to more than 2.26 million with more than $350 billion in revenue, according to a report from Geoscape, which provides multicultural intelligence to companies, and the U.S. Hispanic Chamber of Commerce. The number of Hispanic-owned businesses is projected to grow to more than 3.16 million this year, the report states.
To understand the purchasing habits of the Latino demographic, owners need to do research, attend related conferences and connect with consulting companies, said Casey Steinbacher, president and CEO of the Greater Durham Chamber of Commerce.
“There are consumer spending habits by the Hispanic community in every aspect of daily consumption,” Steinbacher said. “You just have to know and understand the cultural differences, and the product differences, and the buying-purchasing difference that they bring to the marketplace so that you take the best advantage of that.”
Ramirez Reese advises owners to seek training to understand norms and nuances of Latino culture and avoid misconceptions. Owners should ensure their materials are professionally produced and culturally and linguistically inclusive, she said.
Owners should also set up an internal structure, such as a bilingual salesperson, to respond to demand.
“You have one time to capture or lose that market,” she said.
Hispanic small-business owners need to capitalize on the mainstream marketplace to expand their revenue.
The North Carolina Hispanic Chamber of Commerce, which has about 200 small-business members, encourages Hispanic owners to learn English, understand best practices and integrate into organizations and chambers, said President Leonor Clavijo.