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Retailers today recognize the value of marketing in ways that appeal not just to a short list of well-recognized ethnic groups, but to a diverse range of cultural and minority perspectives.
In August, the inaugural Multicultural Retail 360 Summit made its debut in Anaheim, Calif., as specialists in African-American and Asian marketing joined the conference’s cadre of Hispanic experts. The event was previously known as the Hispanic Retail 360 Summit.
Held Aug. 12–15, the 11th annual summit was presented by Stagnito Business Information, publisher of Convenience Store News and other leading retail business magazines. Attendance exceeded 450 retailers, suppliers and other marketers that target multicultural consumers.
Presenting companies included such market leaders as Nielsen, Walmart, Walgreens, the National Football League (NFL), Brookshire’s and Kroger. More than 50 speakers discussed subjects ranging from cultural relevancy beyond language, to the importance of independent grocers gaining a better understanding of black consumers.
Topics were so popular that, by the morning of Aug. 13, the conference had become a leading trend topic in Southern California on social media site Twitter.
FROM FÚTBOL TO FOOTBALL
The growth and significance of the multicultural market were underscored by the NFL, which discussed its commitment to growing the Latino fan base. Already, 26 million Hispanics follow the sport and 63 percent of all Latinos like football more than other sports, said Marissa Fernandez, director of fan strategy and marketing, and the summit’s keynote speaker. These consumers represent 14.2 percent of the 188 million NFL fans nationwide.
The NFL is pairing culturally relevant messages with its all-American image. One Spanish-language ad shows kids playing football; a voiceover discusses their hopes for the future. “The NFL represents both the American culture and the American dream,” said Fernandez.
The NFL is also looking to increase Spanish TV football viewership by building Hispanic fans’ understanding of the game. On ESPN Deportes, it provides both in-depth game analysis for veteran fans and “how to” explanations for more novice viewers.
To reach Hispanic women, the NFL ran ads featuring Dominican-born actress Diane Ramirez in Vogue and People en Español during 2014. This year’s ads star Dascha Polanco, another Dominican actress. At the grassroots level, the NFL is targeting underdeveloped markets with youth participation programs designed to foster lifetime enjoyment of football.
BIG NAMES IN RETAIL
On the retailer end, a panel of executives from top chains talked about hindrances to multicultural initiatives, the importance of companywide cooperation, and how diversity can generate additional revenue.
Rona Fourté, Walgreens’ director of supplier diversity, discussed partnering with black entrepreneur Vera Moore to launch a line of African-American cosmetics. The assortment is offered by 35 Duane Reade stores in New York and via Walgreens.com. “It’s a true example of Walgreens’ commitment to diversity,” Fourté said.
Walgreens also launched a bilingual freestanding insert when it began selling Hispanic groceries, said Martha Garnica, manager of multicultural marketing. The dossier is published at the beginning of the month when low-income customers receive government benefits.
Mike Byron, senior director of supplier diversity at Walmart, said the retailer now offers 3,000 products and services from diverse suppliers. In 2011, it committed to sourcing $25 billion from women-owned companies over the next five years. Byron said Walmart has already exceeded that goal by about $1 billion. “We want to imbed supplier diversity into our overall strategic directive. Everyone in charge of negating or awarding a contract touches my office.”
Kroger executives utilize the input of nine associate resource groups, said Reuben Schaffer, chief diversity officer. Each is comprised of people from a specific ethnic or other group. “They tell us what it’s like to be Asian or gay,” said Schaffer. “Diversity is about the mix; inclusion is making it work. With us, it’s in to be out.”
BROOKSHIRE’S NEW STRATEGY
Three executives from Tyler, Texas-based Brookshire’s outlined the grocer’s cross-departmental, multicultural initiative that has increased sales by almost 30 percent over three years.
Efforts involved identifying and serving customers in areas with heavy concentrations of Hispanics or African-Americans. Demographic targets are further segmented by income, lifestyle, acculturation and shopping habits. To do this, the company has relied on extensive research, outside experts and changes that touch everything from products and packaging to staffing and training.
For example, Brookshire’s removed sweet Mexican bread from its packaging and placed it in self-serve cases. And it began offering beans in bulk.
“It’s not just certain products they want, but the way they shop for them,” said Ivette Zavarce, multicultural marketing coordinator for the grocery chain.
Outside of supermarkets, Sean Bunner, vice president of new business development at the Home Shopping Network (HSN), explained how the multi-billion interactive, multichannel retailer is using a Latina host, Ecuadorian Amy Bravo, to help gain Hispanics’ trust.
Bravo came to the United States in 2000 at age 18, spoke only Spanish and was working in a sandwich shop. After being discovered by HSN, she worked as a model before becoming one of the show’s most popular hosts.
“Being a host is hard,” said Bunner. “Most people who become hosts have been with HSN for years. But Amy did so well in six months that she got the attention of executive management — not just as a Latina, but as a host. It’s hard to gain the trust of Hispanics, but once you do, they stay.”
HSN is already well entrenched in the African-American market with cosmetic supplier Carol’s Daughter and other brands that strongly resonate with blacks.
THIRSTING FOR DATA
The Multicultural Retail 360 Summit also featured an impressive roster of research experts.
Eddie Yoon, principal of The Cambridge Group, a wholly owned subsidiary of Nielsen, and Guy Garcia, president of new mainstream initiatives at EthniFacts LLC, presented Nielsen data that uncovered some radical changes and nuances in U.S. demographics:
- 381 different languages are spoken in the U.S.
- One in six newlywed couples is interracial
- 10,000 baby boomers turn 65 every day
- 2012 was the first year that mortality exceeded births among the non-Hispanic, U.S.-born white population
- Most of the white population’s growth is coming from white immigrants; Asian immigration is also high
- One out of six blacks in the U.S. is an immigrant
Yoon also talked about how demographics do not necessarily predict demand. With Korean TV dramas, for example, just 15 percent of viewers are Asian. And despite blacks’ love of football, more African-Americans watched “Empire” than the Super Bowl. “Advertisers could have spent a lot less and reached more blacks [by using “Empire”],” said Yoon.
New data developments also came from the Center for Multicultural Science. By analyzing a first-time National Grocers Association study on independent supermarkets, the Center determined 25 percent of sales ($32 billion) in this $131-billion channel are generated by retailers with a multicultural focus. (The study involved chains with sales of $2 million-plus).
This information demonstrates how vast the multicultural market has become. According to Isabel Valdés, chairperson of the Center, the U.S. Hispanic market is as large as “one of the fifth or sixth largest economies in the world.”
Anheuser-Busch InBev SA and PepsiCo Inc. were title sponsors of the 2015 Multicultural Retail 360 Summit. McIIhenny Co., maker of Tabasco Sauce, sponsored the Cultural Immersion Tour, a first-day conference highlight (see tour recap on page 142).