Multicultural Retail 360 Celebrates Poly Ethnic Focus

This year, the Multicultural Retail 360 Summit took a new turn as specialists in African American and Asian marketing joined the conference’s cadre of Hispanic experts. Presenting companies included such market leaders as Nielsen, Walmart, Walgreens, the NFL, Brookshire’s and Kroger.

More than 50 speakers discussed subjects ranging from cultural relevancy beyond language and the importance of independent grocers gaining a better understanding of black consumers. Topics were so popular that, by the morning of Thursday, Aug. 13, the conference had become a leading trend topic in Southern California on Twitter.

Anheuser-Busch and PepsiCo were title sponsors of the 11th annual event, which was formerly titled the Hispanic Retail 360 Summit. McIIhenny Company, maker of Tabasco Sauce, sponsored the Cultural Immersion bus tour. Held Aug. 12-15 in Anaheim, the Summit was presented by Stagnito Business Information, publishers of Progressive Grocer, Convenience Store News, Retail Leader, Store Brands and a host of other leading retail business magazines. Total attendance exceeded 450 retailers, suppliers and other marketers that target multicultural consumers.

The growth and significance of the multicultural market were reflected by the National Football League, which is committed to growing its 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 fan strategy and marketing, NFL, 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 will star Dascha Polanco, another Dominican actress. At the grass roots level, the NFL is targeting underdeveloped markets with youth participation programs designed to foster lifetime enjoyment of football.

Big Names in Retail

On the retail end, a panel of executives from top chains talked about hindrances to multicultural initiatives, the importance of company-wide cooperation and how diversity can generate additional revenue.

Rona Fourté, Walgreens’ director, 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,” she added.

Walgreens also launched a bilingual FSI when it began selling Hispanic groceries, said Martha Garnica, manager, multicultural marketing. The dossier is published at the beginning of the month when low-income customers receive government benefits.

Mike Byron, senior director, 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.’”

In a second retail panel, Joe Buescher, VP of merchandising at Food 4 Less, and Mike Hendry, EVP, marketing and merchandising at Hispanic grocery chain Northgate Gonzalez Markets, discussed the changing ethnic customer, employee diversity, key elements of future stores and getting organizational buy-in for diversity programs. Subriana Pierce, managing partner, Navigator Sales & Marketing, also took part in the discussion. The panel was moderated by Cynthia McCloud, director of Food Industry Programs at the USC Marshall School of Business.

Brookshire's New Strategy 

Three executives from Tyler, Texas--based Brookshire’s outlined a 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.

Outside of supermarkets, Sean Bunner, VP of new business development at the Home Shopping Network, 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 U.S. in 2000 at 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

As always, the Multicultural Retail 360 conference featured an impressive roster of research experts. Eddie Yoon, principal of The Cambridge Group, a wholly-owned subsidiary of Nielsen, and Guy Garcia, president, 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 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 they did the Superbowl. “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 that 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 economics in the world.”

Huggies & Tobasco

One important segment of the Hispanic market is comprised of Millennial moms. These women are better educated and more acculturated than previous generations and consider themselves bicultural. “It’s not the stereotypical ad image of a Hispanic mom feeding three kids,” said Lizette Williams, multicultural marketing leader, North America.

Today, a multi-media campaign includes an ad in which mom asks dad to buy diapers and a web app that lets consumers create a song about their family. The song can be used as a ring tone. This is particularly important for the Huggies diaper brand, since one in four babies is born to a Latina mom.

For some suppliers, “multicultural” means targeting almost everybody on the planet. This is the case at McIIhenny Company, maker of Tabasco Sauce. The brand is labeled in 22 languages and sold in more than 180 countries. The versatile hot sauce is used in everything from eggs for breakfast, Bloody Marys in the evening and all sorts of meat, fish and other dishes in between.

In Japan, it goes on spaghetti and pizza; in Mexico, it's a Michelada ingredient. And while some cultures view it as a condiment, others see it as an ingredient. “We became multicultural before it was a buzz word,” said Stephen Romero, VP U.S. sales. “We have to find ways to market in every country we go to.”

In the U.S., Tabasco is used in different ways by 75 percent of Hispanics, 69 percent of Asians, 57 percent of blacks and 55 percent of Anglos. It is also featured by Chipotle Mexican Grill, the company’s largest food service account.

At retail, partnerships with companies like Avocados from Mexico and Olé Foods are a key part of marketing. In Colorado, Tabasco targeted Hispanics ages 18 to 34 by teaming up with former Denver Bronco Terrell Davis, who made a video on how he uses Tabasco. The company also offered a Broncos collector’s item. “One brand carries the other,” said Romero.

In the South, where Tabasco is promoted through African American colleges, the company has come to recognize the cultural importance of pot luck dinners and church gatherings. A Tabasco cookbook offers new takes on traditional black recipes.

“Where do we want the brand to go?” said Romero. “It’s a matter of correctly identifying usage occasions.”