Todays Session Research Overview Hispanic Consumers Shopping - - PowerPoint PPT Presentation

▪ Research Overview ▪ Hispanic Consumers ▪ Shopping Habits ▪ Retailer Preference ▪ Hispanics and Dairy

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Today’s Session

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HISPANIC CONSUMERS

Hispanic Population

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16% 21% 27%

Source: U.S. Census

Fastest growing ethnic group …will be the 2nd largest in the U.S. by 2020

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Hispanic Population

…residing in all states across the U.S.

Source: U.S. Census

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Hispanic Population

…growth in all regions of the U.S.

Source: U.S. Census

…U.S. Hispanic buying power has increased 500% since 1990

Hispanic Buying Power

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Source: Statista.com 2016 – via IRI

$0.00 $0.20 $0.40 $0.60 $0.80 $1.00 $1.20 $1.40 $1.60 $1.80 1990 2000 2010 2012 2015 2017*

$1.5 trillion in 2015 …expected to reach $1.7 trillion by 2017*

Trillions in U.S. Dollars

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SHOPPING HABITS

1. Like to shop with others 2. Fewer pre-shopping activities 3. Spontaneous and Impulsive 4. Willing to try new products 5. Chooses ‘Fresh’ over ‘Price’

…shopping behaviors that drive decisions

Hispanic Shoppers

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Source: Latinum Hispanic Household Survey 2016

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Like to Shop With Others

Source: Latinum Hispanic Household Survey 2016

…when shopping for groceries, Hispanics prefer to shop with others

46% 33% 25% 56% 25% 12%

Myself Spouse/Partner Children

Hispanic Hispanic Hispanic Non-Hispanic Non-Hispanic Non

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Influencing Decisions

Source: Latinum Hispanic Household Survey 2016

…family members play a big role in making shopping decisions

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Pre-Shopping Behavior

51% 31% 19% 62% 37% 21% Check my pantry Refer to a recipe Check product online

Hispanic Hispanic Hispanic Non-Hispanic Non-Hispanic Non-Hispanic

Source: Latinum Hispanic Household Survey 2016

…Hispanics practice fewer pre-shopping activities than Non-Hispanic shoppers

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Pre-Shop for Coupons

…before shopping, Hispanics clip coupons less often than Non-Hispanic shoppers

47% 28% 21% 54% 36% 24% Ad Circulars Online Mobile

Hispanic Hispanic Hispanic Non-Hispanic Non-Hispanic Non-Hispanic

Source: Latinum Hispanic Household Survey 2016

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What Drives Store Visits

38% 40% 30% 49% 42% 23%

On a schedule For a sale For an upcoming event

…Hispanics are more spontaneous shoppers before and during their visit to the store

Hispanic Hispanic Hispanic Non-Hispanic Non-Hispanic Non-Hispanic

Source: Latinum Hispanic Household Survey 2016

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Willing To Try New Items

…for Hispanics, trying new items is an important part of the In-Store experience

72% 58% 40% 65% 43% 29% Food Items Non-Alcoholic Beverages HBC

Hispanic Hispanic Hispanic Non-Hispanic Non-Hispanic Non-Hispanic

Source: IRI Hispaniclink 2016 Study

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…are even more willing to try new products, especially food and beverage

Hispanic Millennials

53%

Beer, Wine & Spirits

58%

Household Cleaning Products

43%

Healthcare OTC Medications

55%

Beauty Products

72%

Food Products

62%

Non-Alcoholic Beverages

Source: IRI Hispaniclink 2016 Study

* Significantly more likely than Non-Hispanics

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Freshness beats Price

Source: Latinum Hispanic Household Survey 2016

33% 16% 9% 27% 21% 12% Freshest products Lowest cost Brands I always buy

Hispanic Hispanic Hispanic Non-Hispanic Non-Hispanic

Non-Hispanic

…Freshness wins with Hispanic shoppers

Hispanics use their smartphones in-store… but Hispanic Millennials use it at a higher rate

In-Store and Online

43%* use smartphones in-store

while 54% of hispanic millennials use smartphones in-store

51% look for coupons 37% compare retail prices 27% look up recipes

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Source: Latinum Hispanic Household Survey 2016

*43% of Non-Hispanics also use smartphones in-store

…Hispanics look for coupons while in-store much like Non-Hispanics

View Coupons In-Store

Coupon

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60% 57% 43% 38% 61% 55% 50% 39%

Retailer Website Retailer App Coupon App Brand Website

Source: Latinum Hispanic Household Survey 2016

Hispanic Hispanic Hispanic Non-Hispanic Non-Hispanic Non-Hispanic Hispanic Non-Hispanic

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…Hispanics engage in social media much like Non-Hispanics

Post-Shopping Behavior

89% 56% 50% 44% 23% 20% 18%

Source: Latinum Hispanic Household Survey 2016

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Post-Shopping Behavior

…Hispanic consumers engage with retailers and brands on social media

Source: Latinum Hispanic Household Survey 2016

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BOTTOM LINE

Source: Latinum Hispanic Household Survey 2016

Hispanics shoppers make more of their purchase decisions in-store!

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Multi-Channel Shoppers

…like most consumers, Hispanics shop a variety of different retailers

Source: IRI Hispaniclink 2016 Study & Innovation Center

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Walmart Wins on Price

…but drug leads with loyalty program

74% 32% 47% 34% 34% 46% 30% 46% 49% 21% 50% 21% 44% 32% 44% 31% 0% 10% 20% 30% 40% 50% 60% 70% 80%

Offers good prices Has a good loyalty program

Walmart Target Walgreens CVS Dollar General Family Dollar Costco Sam's Club

Source: Latinum Hispanic Household Survey 2016

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Loyalty Card Usage

…most Hispanic consumers have loyalty cards and they use them frequently

% of Hispanics use

loyalty cards

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• In-store savings
• Coupons
• Gas rewards
• For credits / points
• Special events

Reasons… for using the card

Source: VozLatinum Loyalty Card Usage Study 2014

Compared to 57% of all shoppers

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Source: Latinum Hispanic Household Survey 2016

68% 71% 48% 59% 54% 55% 52% 54%

0% 10% 20% 30% 40% 50% 60% 70% 80%

Offers fresh produce Offers fresh dairy products Walmart Target Costco Sam's Club

Walmart Wins on Fresh

Hispanics believe Walmart has the freshest products …with dairy ranking highest

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Walmart and Target

…rank high in connecting with Hispanic shoppers

62% 58% 46% 41% 36% 38% 43% 41% 0% 10% 20% 30% 40% 50% 60% 70% Is a store for people like me

Walmart Target Walgreens CVS Dollar General Family Dollar Costco Sam's Club

Source: Latinum Hispanic Household Survey 2016

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Hispanic Connection

…making shoppers feel welcome

Regardless of their preferred language,

58% of Hispanics want

access to Spanish translations in-store and

• n product packaging

Source: IRI Hispaniclink 2016 Study

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Prefer Spanish Language

…different Hispanics desire different levels

• f access to Spanish Language

English Speaking

67% lived in US >25 years

34% of Hispanic population

Bilingual

49% lived in US >25 years

30% of Hispanic population

Spanish Speaking

18% lived in US <5 years

36% of Hispanic population

Instructions on Package 22% 54% 78% Product Features 23% 54% 75% Ingredients on Package 25% 58% 76% Spanish Signage 13% 38% 61%

Source: IRI Hispaniclink 2016 Study & Innovation Center

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Source: IRI Hispaniclink 2016 Study

More Dollars per Trip

…the in-store experience often drives Hispanics retailer choice

On average, Hispanics spend 9% more per shopping trip than Non-Hispanics

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Product Choices

…Hispanics are less likely to be driven by habit when choosing products

42% of Hispanics are

influenced by the “brand they always buy” when choosing products

…compared to 60% of Non-Hispanic shoppers

Source: IRI Hispaniclink 2016 Study

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Private Label Perception

…not as valued as national brands

78% of Hispanic shoppers

believe private label food items are equal to or not as good as national brands

Source: IRI Hispaniclink 2016 Study

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HISPANICS & DAIRY

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Hispanics and Dairy

Natural Chees e

12% of Sales

Milk

13% of Sales

Yogurt Drinks

30% of Sales

Yogurt

12% of Sales

…dairy consumption is high among Hispanics, who contribute significantly to overall sales

Ice Cream

9% of Sales

Source: IIRI Dairy Hispanic Consumption Trends May 2017

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Source: Package Facts 2016 & IRI Dairy Consumption

Hispanics = Milk Growth

…driving growth in milk category

For the past 10 years, Hispanic consumers drove all of the growth in the milk category

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Milk Volume vs. YAG

Source: IRI Specialty Panel – All Channels 2017

…Volume growth for Hispanics exceeded All Volume growth in all channels except Dollar

1% 5% 9% 10% 14% 4%

• 3%

4%

• 4%
• 3%

Dollar Grocery Walmart Club Mass

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Hispanic Volume All Outlet Volume

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Source: US Dairy

Milk Consumption

…Hispanic households purchasing milk

but, milk consumption remains high for Hispanic children Milk consumption decreases as Hispanics become more acculturated…

Hispanic Kids and Dairy

…Top 4 favorite foods for Kids

Source: Whitman Insight Strategies 2016

86% 73% 68% 65% 85% 73% 67% 60% Pizza Cereal Dairy Milk Yogurt

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Hispanic kids Hispanic kids Hispanic kids Non-Hispanic kids Non-Hispanic kids Non-Hispanic kids Hispanic kids Non-Hispanic kids

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Hispanics and Milk

Source: Latinum Multi-Cultural Beverage Consumption 2016

…when and why they consume Milk

Milk is mostly

consumed at home during breakfast

Nutritional value

is the primary reason for purchasing milk

Nutritional Value of Milk

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…Hispanics recognize the nutritional value of Milk based on the following:

Source: US Dairy

10 20 30 40 50 60 70 80 90 Calcium Folic Acid Omega 3 Probiotic

79% 58% 54% 44%

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Whole Milk Preference

Hispanics drink 66% more whole fat milk than Non-Hispanic customers

Source: Package Facts 2016 and USDA

Hispanics believe that whole milk tastes better and is more nutritious than other milk

…whole milk has the highest value

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Hispanics and Coffee

83% of adults drink coffee

U.S. Hispanics have the

highest consumption

• f coffee, and…
• 67% add cream,

sugar, and milk to their coffee

Source: Nespresso 2016

…growth opportunity for cream and milk

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Source: US Dairy

Yogurt Consumption

…Hispanic households purchasing yogurt

Hispanic yogurt consumption grows with acculturation

Yogurt consumption for U.S. born Hispanics mimic average U.S. consumption habits

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Yogurt Volume vs. YAG

Source: IRI Specialty Panel – All Channels 2017

• 10%
• 7%

2% 1%

• 23%
• 16%
• 4%
• 3%
• 7%
• 8%

Dollar Grocery Walmart Club Mass

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Hispanic Volume All Outlet Volume

…Volume growth for Hispanics led All Volume growth in Club and Walmart only

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Source: U.S. Dairy

Hispanic Yogurt Growth

…Hispanics enjoy all varieties of yogurt especially Hispanic-brand yogurt

Hispanic yogurt continues to grow in sales and variety

Huge growth

• pportunity with kids

and adults as they spend more time in U.S.

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Drinkable Yogurt

…leading yogurt products

Source: Food Business News 2016 & Dairy Foods 2017

Drinkable yogurt

is often the preferred yogurt for Hispanic families because

• f convenience and nutrition

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Source: US Dairy

Hispanics and Cheese

Cheese is an important part

• f the Hispanic diet and

consumption continues to grow with acculturation

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Source: Food Business News 2016

Hispanics Like Cheese

Opportunity to build cheese sales since Hispanics are willing to try new cheeses and new recipes with cheese

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Cheese Volume vs. YAG

Source: IRI Specialty Panel – All Channels 2017

19% 9% 5% 11% 28% 15% 3% 8% 1% 4% Dollar Grocery Walmart Club Mass

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Hispanic Volume All Outlet Volume

…Volume growth for Hispanics exceeded All Volume growth in all channels except Walmart

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Hispanic Cheese

2% of total cheese fixed weight dollar share

97% is natural 9% growth in 2016 Queso Fresco is the No. 1 variety with 64% of volume share 93% is national brand 85% is regular flavored 99% is regular fat content

Source: IRI Hispanic Cheese deck 2017

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Hispanic Millennials over-index with Hispanic cheese accounting for 15% of sales

Source: IRI Hispanic Cheese deck 2017

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Merging Cultures

…shifting appetites in the U.S.

Source: Package Facts 2016

Tortillas and taco kits

• utsell hamburgers

and hot dog buns Salsa boasts twice

the dollar sales of

ketchup

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SUMMARY OF FINDINGS

455 pages of research

Summary of Findings

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Spontaneous shoppers who are willing to try new things Appreciate and respond to Spanish language materials Family-centric … identifies fresh & nutritious as top reasons for dairy purchase Dairy Lovers … higher consumption when paired with complimentary items

HISPANIC CONSUMERS ARE…

1. 2. 3. 4.

Summary of Findings

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Spontaneous shoppers who are willing to try new things

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Retail

• Sample and promote new items in-store
• Capture impulse purchases by featuring dairy products in
• ther parts of the store: deli, produce, check-out

Manufacturer/Processor

• Support new product launches with in-store materials
• Innovate with new products/flavors targeted to Hispanics

Food Service

• Promote new recipes featuring yogurt and cheese
• Consider table-tents promoting NEW cheese apps
• Sampling opportunities to create an fun atmosphere

…recommendations for success

In-Store Experience

…sampling, willing to try new items

Product Sampling

• Milk. Cheese. Yogurt.

Cross Promote Hispanic Cheeses with Taco Shells and Tortillas

Breakfast Cross Promotions New Recipes for Kids

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Food Service Experience

…consider fresh hispanic-inspired products, recipes and ambiance College Cafeteria’s, Hospitals and Restaurants

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Summary of Findings

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Appreciate and respond to Spanish language materials

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Retail

• Add Hispanic images and Spanish language on in-store
• Consider end cap featuring all bi-lingual products
• Encourage Spanish-speaking employees to communicate

with customers in common language Manufacturer/Processor

• Use bi-lingual copy on product packaging and signage
• Share bi-lingual messages via social media

Food Service

• Welcome diners with celebrations like Cinco de Mayo
• Create authentic recipes – share ‘old world’ history

…recommendations for success

In-Store Experience

…with fun, excitement and a Hispanic connection

The Dairy Experience

Connect, Engage and Welcome with Spanish Signage and Products

New Item Signs

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Drive Product Innovation

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…consider bi-lingual, portable, fresh and nutritious

Bi-Lingual Packaging

• Hispanic products
• National Brands
• Private Label

Product Information

• Nutritional information
• Natural ingredients
• Recipe Ideas

Summary of Findings

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Family-centric … identifies fresh & nutritious as top reasons for dairy purchase

3.

…recommendations for success

Retail

• Provide nutritional signage for milk, cheese and yogurt
• Expand employee training in fresh, local and nutritious

Manufacturer/Processor

• Provide larger, family-size package with nutritional value
• Share fresh and nutritional information via social media

Food Service

• Provide nutritional information on menus and table tents
• Share the fresh and local message on dairy items

Summary of Findings

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Dairy Lovers … higher consumption when paired with complimentary items

4.

…recommendations for success

Retail

• Provide ongoing promotions with milk, cream and coffee
• Let kids drive the sale … milk & cookies and milk & pizza

Manufacturer/Processor

• Provide cross merchandising items on package with

images and recipe ideas - - promote on social media Food Service

• Meal deals with breakfast & dairy and apps & dairy
• Try new items and new recipes featuring dairy

Retail and Food Service

…fun, new cross merchandising ideas to drive dairy sales

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Online Connection

…retailers website and social media

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89% 56%

• Hispanic-based messaging
• Spanish-language messaging
• Tortilla and cheese promotions
• Hispanic / Dairy recipes
• Promote nutritional value of milk
• Cheese as an after school snack
• Yogurt as a morning snack
• Online coupons for dairy items

50% 44%

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IN INSPIRE.

• SPIRE. IN

INFORM.

• ORM. EDU

EDUCATE. TE.

Un Under erstan stand Hispani nic c Shopper pers.

• s. Exceed

ed their Expecta ectatio tions. ns.