Practice this phrase and try to have it down pat by midcentury: “Bienvenido a la bodega.”
Sure, it’ll require a bit more than that (“Welcome to the little convenience store”) to gain loyalty from Spanish-speaking Hispanic consumers. But it’s probably a feel-good start in outfitting the c-store to attract one of the fastest-growing demographics in the U.S.
Data released in August by the U.S. Census Bureau shows the country’s Hispanic population—Spanish- or English-speaking—is expected to triple from now until 2050, jumping from 46.7 million to 132.8 million. More importantly, the bureau projects the Hispanic portion of the nation’s overall population will essentially double, from 15% to 30%.
By 2050, nearly one in three U.S. residents would be Hispanic. On that note, the Census data predicts that minorities, who are currently about a third of the U.S. population, will actually become the majority by 2042.
It’s not entirely breaking news, per se, as a number of researchers have said as much in recent years. It is, however, the first time that the Census Bureau has officially released such numbers in some time.
And while these projections may not sit well with some politically, they identify tremendous growth opportunities for retail channels that successfully respond to Hispanic consumers’ needs and desires.
“The first thing I learned,” said Brad Eaton, category manager at Spinx Oil Co., “is that Mexican consumers will go where the tortillas are fresh.”
Buying Power
Spinx operates 65 convenience stores throughout South Carolina, a state that has the fastest-growing Hispanic population in the nation, according to U.S. Census data.
While larger states like Texas and California have more Hispanic residents in terms of shear numbers, the Palmetto State saw the largest increase in Hispanic residents last year, about 9%.
In Spinx’s market area in northern South Carolina, the Mexican population is closer to 18%. It’s a point that hasn’t been lost on Eaton and his colleagues. “It’s taken us a while to build,” he said of his Hispanic consumer base.
But the multi-faceted marketing machine at Spinx has done its job, if sales figures are any watermark. Mexican products accounted for almost 27% of the chain’s sweet-snack sales last year, and of the retailer’s Top 10-selling sweet snacks for the same year, seven were Mexican products.
“When you’re considering the sweet snacks section, all your Kellogg’s, Kraft, etc., that’s a big category,” Eaton said. “And then to think that 27% of those sales are Mexican products.”
Jon Bratta, director of proprietary brands at ampm, also recognizes the buying power of this group.
“The Hispanic consumer is one that is critically important to ampm,” Bratta said. “Although we are already a preferred destination for the Hispanic consumer, our brand team and category-management teams are actively working on new products that we believe will provide a compelling draw for this important customer.”
Who, What and Where
Pinpointing the precise makeup of a convenience store’s Hispanic market is paramount in understanding what these shoppers are comfortable buying.
For starters, they crave authenticity. Conveniently enough, c-stores have something working in their favor on this right from the start.
“The convenience store works really well for Hispanics, because this is what they’re used to,” said Sylvia Melendez-Klinger, founder of Hispanic Food Communications Inc., a Hispanic food and marketing consultant for powerhouse suppliers and retailers. “They have these little stores on every corner in Mexico.”
Small pharmacies and drug stores in Mexico double as convenience stores carrying everything under the sun, and they’re usually just blocks away from residential areas. “When they see those convenience stores (here),” Melendez-Klinger said, “it reminds them of (home).”
Beyond that, retailers have to understand exactly which Hispanic customer they’re trying to entice, Mexican? Columbian? Puerto Rican? Cuban? They all have different tastes.
“You have to do a needs assessment in the community,” Melendez-Klinger said. “The research is out there. You have to have the clientele and have them already coming to the store.”
Or, at the very least, you must know how to get them into the store. “One of the first things we learned was, define your market,” Eaton said. “When we say Hispanic, we’re talking strictly Mexican.”
A somewhat counterintuitive discovery for Spinx: The greatest sales were reaped not in markets where Hispanic consumers lived, but where they worked. “The busiest stores are where the construction is,” Eaton said.
Authentic Suppliers and Products
Spinx began courting its potential Mexican consumers years ago, with early efforts including the rollout of Hispanic beverages from an area wholesaler, as well as various items from a grocery wholesaler whose products were from countries “that had nothing to do with the Hispanic or Mexican population,” Eaton said. “Our sets just died.”
Those early efforts lacked the zing Spinx was looking for, so four years ago the chain turned to a local supplier—what Eaton calls his “tienda”—run by a Hispanic guy with genuine knowledge of Hispanic trends.
“When we started seeing how fast the drinks were going, we sat down and talked to him about delivering pastries,” Eaton said. “It’s been about four years now, and it’s been a good part of our relationship. He knows the trends. His dad is from Maine, his mother is from Mexico. He knows what they eat, he knows what they like.
“I’m very fortunate to have that relationship,” Eaton said. “I talk to other c-store people, and they don’t have that type of supplier.”
There are food and beverage brands that are Hispanic brands, but they may not appeal to microsets in the Hispanic demographic. “That brand might be the brand that Puerto Ricans or Columbians would want,” Eaton said, adding that some products are also more seasonal than others. “He knows what they’re eating and when they’re eating them.”
Joe Prezioso, owner of a RediGo c-store that’s part of a seven-store co-operative in northeast Ohio, relies on his suppliers as well, but also turns to Hispanic employees to provide insight on products that appeal to Hispanic shoppers.
Much like Spinx’s South Carolina market, Prezioso’s Hispanic consumers are typically Mexican, though there’s also a sizable Puerto Rican representation throughout the Greater Cleveland area.
Sweet snacks and pastries made by Philadelphia-based Tastykakes are popular at RediGo, as are beverages and snacks made by Goya and Bimbo. “We have a rack right out in front,” Prezioso said. “It brings ‘em back and makes ‘em feel at home.”
Melendez-Klinger said well-priced pastries and sweets are indeed popular with most Hispanic consumers, especially for the morning daypart.
That wasn’t a point lost on Eaton, either. “We carry a big line of fresh cakes,” he said. “A lot of cookies and things that have a longer shelf life.”
Spinx carries products from Bimbo and Goya, as well as Fanta sodas and flavored drinks like Jarritos sodas and Jumex Fruit Nectars. Gelatins and liquid yogurts from Mexico are also hot items. Fresh tortillas, hot sauces and salsas are staples as well.
A new product Spinx stores recently added: tres leches cake. “They are fantastic,” Eaton said of the pastry, which literally translates to “three-milk cake” and is made from dairy and whipped cream products.
Whether the advice is coming from a supplier, trade shows, Hispanic employees or colleagues, Eaton manages to tap into the latest Hispanic food trends. “There’s always something new coming out of Mexico that may not have been packaged before,” he said.
Grassroots is Good Advertising
Melendez-Klinger echoed Eaton’s sentiment that Hispanics are great when it comes to grassroots advertising.
“Word-of-mouth is really big,” she said. “You have to be careful, though. They’re really skeptical. You have to do it just right, so they don’t get scared and think that … they have to buy something or it’s a gimmick.”
To be sure, some are immigrants or have relatives who are immigrants. Fostering trust and loyalty for these groups is a long-term commitment.
“It’s been a learning experience,” Eaton said. “But the good thing about the Mexican community is they talk amongst themselves. When one finds a place, they tell the others. It’s really word-of-mouth advertising for us.”
Word-of-mouth may seal the deal, but it would be shortsighted to scrap traditional advertising routes. “You have to advertise a lot in the neighborhoods,” Melendez-Klinger said. “A lot of times they don’t know what you’re doing.”
Spinx started its advertising push with Spanish-language in-store signage, and over the years has mastered a well-polished marketing machine keenly attuned to Hispanic consumers. ATMs, snack and beverages areas and other key points in Spinx stores boast bilingual signage.
Just a sampling of other measurable marketing steps at Spinx:
– Publishing Spanish-language product ads in newspapers, as well as Spanish ads on Muzak.
– Printing the tagline for the Spinx logo, “Making Life Easier,” in Spanish: “Hace la vida mas facil.”
– Hiring bilingual managers and associates. “Some of our best stores have bilingual managers in them,” Eaton said. “One manager in our top store is from Columbia. Another is from Puerto Rico.”
The Right Mix, The Right Message
The convenience store that fine tunes its product mix to gain authenticity and sculpt a message that triggers local buzz is bound to solidify a place in the Hispanic mind.
“If they find what they want at the store, they’ll make the trip,” Melendez-Klinger said. “I’ll travel 15 to 20 miles to find Puerto Rican foods. I don’t care what it costs.”
That’s what Eaton is looking for.
“It takes time to build a business when you build a new store,” he said. “But the Mexicans here know pretty much where to come.”
