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HISPANICS BUY MORE NONFOOD: GMDC

CHICAGO -- Hispanic consumers could be a crucial component of nonfood category health, according to a study previewed at the Food Marketing Institute show here.The study will be released in September by the New York-based Educational Foundation of the General Merchandise Distributors Council, Colorado Springs, Colo."Hispanics buy more nonfood items than other groups in the United States," said Jim

CHICAGO -- Hispanic consumers could be a crucial component of nonfood category health, according to a study previewed at the Food Marketing Institute show here.

The study will be released in September by the New York-based Educational Foundation of the General Merchandise Distributors Council, Colorado Springs, Colo.

"Hispanics buy more nonfood items than other groups in the United States," said Jim Wisner, president, Wisner Marketing Group, Libertyville, Ill., during the presentation.

According to data from the ACNielsen Homescan L.A. Hispanic Panel, published by ACNielsen, Schaumburg, Ill., Hispanic spending power was $653 billion in 2003.

The most popular categories among Hispanics, according to GMDC's study, include children and family-oriented products like infant health and beauty care, diapers, clothing and Mother's Day products. Thirty-nine percent of Hispanics, vs. 27% of non-Hispanics, are under the age of 19, according to data presented.

It is very important for retailers to pay attention to the Hispanic market, said James Dodge, vice president, global business intelligence, ACNielsen. In 2002, 38.8 million Hispanics were living in the United States, 9.8% more than two years prior, according to the U.S. Census Bureau.

Almost half of U.S. Hispanics are concentrated in a handful of cities, however, Dodge said. Chicago, Houston, San Antonio, Miami, New York and Los Angeles have the highest population numbers, according to data from ACNielsen's Claritas, a Hispanic-oriented information service.

Los Angeles has the largest population of Hispanics, with 17% of U.S. Hispanics living there. San Antonio has the largest population segment as compared to other residents. Hispanics represent 57% of that market. It's important to remember that Census data is understated, Wisner pointed out. "The impact of the change in population will be greater than just the numbers suggest it is."

Hispanic shoppers are also an appealing demographic from a retailer standpoint, Dodge said. The average weekly grocery spending of Hispanic households is $104.61, vs. $84.88 among non-Hispanics. Unacculturated Hispanics spend even more in grocery stores, according to data presented from ADVO, El Mercado 2004. Unacculturated Hispanics spend $131.50 a week in the grocery channel, as compared to acculturated Hispanics, who spend $128.50. The total U.S. market spends an average of $91.

Unacculturated Hispanics also go to fewer channels to complete their purchases, according to ACNielsen Homescan data. Foreign-born Hispanic population numbers were at an all-time high in 2003, according to Census data.

While it may seem that ethnic marketing has received a great deal of attention, not as much has been accomplished as one would think, Wisner said.

"A lot has been done in food, but very little has been done in general merchandise and health and beauty care."

One wholesaler that has done a particularly good job of marketing to its Hispanic customers is Unified Western Grocers, Commerce, Calif., said Wisner. The company has made good use of a number of key concepts, he said, including children and family, communication, connecting, celebration, cuisine, culture, caring and community through large events and in-store positioning.

Unified and the independent markets it serves in Los Angeles sponsor two large community festivals that celebrate Cinco de Mayo, held this year on April 24, and Independencia (Mexican Independence) on Sept. 4. The events leverage the chain's knowledge of its Hispanic customer base in a big way, Wisner said. More than 150,000 people showed up for the Cinco De Mayo event.

"It goes beyond fun to loyalty," Wisner said.

The festival incorporated manufacturers like Procter & Gamble, Cincinnati, and Unilever, Greenwich, Conn., which did product sampling, as well as prepaid phone card providers and Western Union financial services, along with political and community organizations.