Get Ready for the Battle of the Latino Basket

Marketers Know the Real Skirmish Is at Retail -- Do Their Agencies?

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Among the more than 800 attendees of last week's Hispanic Retail 360 conference held in San Diego, there were surprisingly very few agencies. In fact, according to conference organizers, only about 10% of attendees came from the agency world. I'm surprised by such small agency turnout given that performance at retail is the ultimate measure of success for any marketing campaign. Isn't this where the rubber meets the road? It's all about moving cases and gaining market share -- or getting fired for not delivering.

Maybe agencies don't care about the tremendous impact Latinos are having at retail, but their clients certainly do, evidenced by the largest crowd I've seen at this conference in the past five years. The three-day conference included a keynote speech from former Mexican President Vicente Fox (who called for a renewed vision of NAFTA) and an intimate conversation with Latin hip-hop sensation Pitbull, who shared his perspective on how he connects with his fans, whether they be Latinos or not.

But for me, the most interesting presentation came from Jose Luis Prado, the recently appointed president of Quaker Foods and Snacks North America, PepsiCo. After a 17-year career at PepsiCo, including most recently running and successfully growing their Gamesa business in Mexico, Mr. Prado moved to Chicago six months ago to take charge of the Quaker Foods business.

PepsiCo is one of those companies that early on saw the value of marketing to its ethnic consumers and was one of the leaders in setting up a strong multicultural practice in the late 1990s. Over the last two decades, however, internal support for multicultural marketing has suffered its ups and downs -- resulting in very inconsistent voice and presence with its most important consumers. It's hard not to wonder that , if it had been consistent with its multicultural marketing practice -- like McDonald's or P&G or Kraft have been -- would be in such a tough spot now. But it seems like the tide is turning at PepsiCo.

Mr. Prado spoke about how the company wanted to go to market with "an open mind" and, through innovation, bring Latino flavors to mainstream products like Gatorade. In addition, Quaker is catering to Hispanic tastes directly by playing off of the tradition of aguas frescas with Dole's recent launch of new fruit juices under the "sensacion natural" line.

Bottom line: It's all about foot traffic, and retailers know better than anyone who is shopping their stores and what products move or don't move. The fact that so many showed up at this conference to learn how to win with the Latino consumer is a testament to their changing perceptions.

"Due to cultural factors and values, Hispanics are buyers of premium products who don't compromise much when it comes to providing for our (larger) families," wrote Cesar Melgoza, CEO of Geoscape, in his recent article Are Retail Giants Sleeping on Hispanic Opportunities?

"If one measures the lifetime spending potential of an average household from today to its projected lifetime, you will see that Hispanic households will actually spend more, not less, than White, non-Hispanic households, to the tune of about 48% on food consumed at home and away, 82% on apparel and 22 % on personal care products," he added. This is due, of course, to Latinos being younger and having larger households.

Mr. Prado's experience runs deep in Latin America and Spain, which will certainly help him understand the Latino consumer in the U.S. A quick look at the array of products in the Quaker Foods portfolio that are currently not being marketed to Latino consumers makes me think that Indra Nooyi knew exactly what she was doing when she named Prado to his most recent post. Forget the cola wars and get ready for the battle of the Latino basket.

Chiqui Cartagena is VP-corporate marketing for Univision Communications. She is also the author of Latino Boom!: Everything You Need to Know to Grow Your Business in the U.S. Hispanic Market. Follow Chiqui on Twitter @chiquicartagena.
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