According to Angulo, most Spanish-speaking cultures also have a strong sense of family and religious devotion, but she, too, said it is difficult to segment by nation of origin. "If you had to slice it up you wouldn't have enough money to target everybody. You have to understand the bigger segment. At Kraft we have to think about the Mexicans."
The level of acculturation is also an important consideration in marketing to Hispanic consumers, she noted. Regardless of country of origin, there are major differences in how a customer who has been in the United States for four or five years reacts to a product, compared to one whose family has been in this country for three generations. Distribution channels differ as well. Newly-arrived Hispanics tend to shop in small, urban stores, while those whose families have been in the country longer are more likely to buy at retail chains, she said.
Louis Martin, a consultant at McKinsey & Co., suggested that Hispanic consumer markets in the United States are so big that Latin firms based overseas are looking to break in. They view the market as confined not just to North America, "but accessible to Latin American companies as well," he said, adding, however, that U.S. companies which have learned to target Hispanics effectively would not necessarily be able to turn such success into results overseas.
"That said, there's tremendous cross-pollination," he noted, with Latin Americans traveling to North America and back frequently. As a result, multinational firms need to be careful positioning brands in the United States and Latin America because of differences in consumer sophistication. A brand that might sell at a discounter like Wal-Mart in the United States may be a premium brand in Latin America. "There's a continuous flow of products that are bought in the States and sent home to families [which could result] in brand confusion."
Some specialized products are best targeted regionally, Martin said. An understanding of the local market should determine whether to promote a product with a Mexican soccer player or a Dominican baseball star. "Understanding your demographic base on a local level can help you."
According to Weitzman, another way to think of the Hispanic market is as one made up of younger, larger families that tend to live in multigenerational households more often than the general population. Hispanic families are also more likely to make purchasing decisions as a group. "We will see whole families going food shopping or opening a checking account," she said. And Hispanics, more than the overall population, "tend to be brand loyal and respond to Spanish language movie stars as spokespersons. They are not a jaded segment. They are like a typical 1950s family."
Weitzman also noted that the Hispanic market is both mature and developing at the same time. "Everything in financial services comes down to, 'Do you have credit or not?' For Hispanics, there are many who do, but then there is a huge segment that is 'unestablished' and 'unbanked' with no credit cards." Meanwhile, financial firms have saturated the market among Hispanics who are acculturated, have good credit and own their own homes. Newer immigrants, she said, still struggle to establish credit. "There will be those two segments forever."
Acculturation can occur at different rates, Angulo said. For example, there are so many Mexicans in Los Angeles that they have developed their own rich community and feel less need to interact with mainstream America than Hispanics in other regions. "They are holding more of their culture. It is happening in different ways across the different Hispanic segments."
Hispanics want to acculturate, she said, but they don't want to assimilate. She suggested that as Hispanics become more acculturated, general marketing campaigns must become more trans-cultural. In addition, focused marketing should reach out to the newer immigrants - "all the people we don't even know about, who in the next three to five years may be coming."
Kraft has business-to-business partnerships and media alliances tailored to the Hispanic market, but no major Hispanic products. "At the end of the day we are Kraft Foods and we are as American as apple pie," Angulo said. In the past, Kraft has tried to launch more specific Hispanic products, but it didn't work well. "We are American cheese. When consumers come over, it is part of that acculturation."
Martin also pointed out that it is difficult for marketers to research buying patterns among Hispanics, compared with other populations. For example, many Hispanics shop in small, inner-city stores that do not scan items. Researchers would have to track buying patterns manually. "Customers have told us it takes five times as long to understand these segments. A lot of marketing firms have to rethink how they can approach this segment going forward."
In surveys of his firm's clients, respondents mentioned marketing to Hispanics as one of their top 10 goals, but it was not usually in the top five or six priorities. "Many heads of companies say, 'I know it's important but I don't understand the most efficient way to go after it.' They put it on the list, but they target the problems they know they can fix today. That mentality is going to have to change."
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