Wal-Mart Caters To Hispanic Customers
Last updated Thursday, May 11, 2006 9:58 PM CDT in Business
By Anita French
The Morning News
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"Precios bajos todos los dias."
In Spanish or English, Wal-Mart's mantra of "Every day low prices" is the main reason why Hispanics shop at the retailer's stores, the company says research shows. But that doesn't mean Wal-Mart isn't reaching out in other ways to capture more of this customer base.
Wal-Mart Stores Inc.'s chief marketing officer, John Fleming, said at the company's April media conference in Rogers that Wal-Mart has at least 1,300 stores with a "strong" Hispanic customer base.
He told Ad Age that the company is reaching out to these customers by stocking food items they use, such as peppers and mangoes, and cooking tortillas in the stores.
Wal-Mart spokeswoman Linda Blakely said the company has gone even further in some stores, particularly in areas like Northwest Arkansas where there is a high concentration of Hispanic residents.
"In addition to food, categories such as greeting cards, party supplies, music and home videos, as well as health and beauty aids are merchandised to meet the preferences of the Hispanic customer," she said. "Our outreach to Hispanic customers also includes bilingual in-store signage, bilingual staff and community involvement."
Blakely said Wal-Mart updates its customer data daily, and that the company now has 1,400 stores whose customer bases include a significant percent of Hispanic customers.
Wal-Mart also has doubled its ads aimed at Hispanics, and Blakely said these advertisements appear in Spanish-language magazines, television and radio and bilingual versions of Wal-Mart circular ads. In 2004, Wal-Mart launched Viviendo Magazine, a quarterly publication written in English and Spanish. The magazine is targeted to women with families, Blakely said.
"With a circulation of more than 500,000, Viviendo is available free in those stores we have identified with significant portions of the customer base being Hispanic," she said.
Wal-Mart is not the only one reaching out to Hispanics. Kellogg Co., the nation's dominant cereal maker, says it's boosting marketing to Hispanics by 60 percent, according to a recent Associated Press article.
Kellogg took the unusual step of focusing solely on Hispanic marketing at last week's Food Marketing Institute Show, the annual trade show for supermarkets in Chicago, the Associated Press reported.
Hispanics are the youngest, fastest-growing segment of the American population, according to the Census Bureau.
They were 14 percent of the population in 2004 but made up nearly half the nation's growth from 2000 to 2004. Their median age, just under 27 years, is younger than the general population. The median age is just over 31 years for blacks and just over 40 years for white non-Hispanics.
Unilever released a recent study which said that while Hispanic food shoppers tend to be better prepared for their food shopping trips, retailers tend not to appreciate them, thinking that bilingual signs and coupons will be enough to cement their loyalty.
"Hispanics are far less satisfied with their shopping experience than the general market," said Mike Twitty, group research manager of shopper insights at Unilever's U.S. unit. "Only 35 percent of Hispanic shoppers are extremely satisfied with their shopping experiences, versus the general market, where it's 58 percent."
Springdale-based Harps converted its regular grocery store in Rogers to a supermercado two years ago in an effort to capture Hispanic customers. Harps spokesman Kim Eskew said this week that the store is "doing OK."
"We certainly haven't perfected what we're doing there. Marketing to the Latino community is not something we're experts at yet. It's somewhat of a trial and error process," Eskew said.
Blakely said a retail study last year by NOP World showed that 36 percent of Hispanic Americans named Wal-Mart as their first choice. While no one specific Hispanic store was selected by a significant percent of consumers, 5 percent of respondents named as their favorite a local store that caters to Hispanic Americans, the study said.
"When the NOP World study asked which factors are most important when deciding where to shop, Hispanic Americans cited the same priorities that other Americans have when choosing retailers -- convenience, low prices, and a wide range of merchandise," Blakely said.
"However, a critical second-tier of priorities that is unique to the Hispanic market is cited by about half of Hispanics as being 'very important', including store employees speaking Spanish, products relevant to Hispanic consumers and Spanish language signage."
The Associated Press contributed to this article.
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justtex wrote on Mar 13, 2009 3:55 PM:
There, they explain that Walmart will call these stores "Supermercado de Walmart", in Phoenix and Houston, and one of the Houston Sam's Club's will be re-named the "Más Club".
The FT also explains that Eduardo Castro-Wright, previously, the head of WalMart’s Mexican subsidiary, currently the head of all of WalMart’s US stores (since 2005), is the chief promoter of all these ethnic-centro changes.
It truly saddens me that Walmart/Sam's Clubs have decided to participate in the expansion of the ever growing cultural divide, here in the USA.
In the short term, this business model just may pay off for the company.
However, in the long term, I am certain there will be a fairly large consumer backlash, by those already very concerned about illegal immigration, and the expanding cultural divide.
And that just can't be good for Walmart/Sam's, or the larger general public they claim to serve.
In reality, all this is no problem-o for me. And I'm certain that Kmart will love to have more of my business once again. "