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IRI's 2016 HispanicLink Study Reveals Hispanic Shoppers' Outsized Interest in CPG E-commerce

Hispanic Population Impact on U.S. Shopping Trends Accelerating, IRI’s Eighth Hispanic Shopper Study Notes

CHICAGO Aug. 10, 2016 — IRI® today released findings from its latest HispanicLink™ study, with new information about Hispanic shoppers’ path to purchase CPG products and a particular focus on the group’s widespread adoption of e-commerce as a purchase channel.

Today, there are 55 million Hispanics in the United States, representing 18 percent of the population and spending power of $1.5 trillion. Almost 60 percent of Hispanics are millennials or younger, and they account for 80 percent of segment growth, making Hispanic shoppers vital for any manufacturer or retailer eager to grow sales and market share. In addition, Hispanics tend to shop online more than non-Hispanics in several critical categories, including cosmetics, fragrances and beauty, and general household products.

Hispanics are also a highly diverse group, based on factors such as age, income, specific needs and language preference — English-preferred, bilingual or Spanish-preferred. For online shopping, there are six segments of e-commerce shoppers in the United States, defined by their attitudes and behaviors about the activity: e-shopping enthusiasts, variety seekers, review seekers, selective e-shoppers, e-shopping resistors and e-shopping avoiders. Hispanic shoppers are disproportionately prominent in two of the most active online shopping segments, e-shopping enthusiasts and review seekers, providing unique growth opportunities for CPG companies, which can leverage this knowledge and refine their marketing efforts. 

“Every year, we do an in-depth study on Hispanics’ shopping behaviors, and our most recent research takes a closer look at their shopper journey, including specific insights about the channels they shop, specific products they purchase as well as their adoption of e-commerce as a convenient and affordable means to do their shopping,” said Larry Levin, executive vice president of Consumer and Shopper Marketing for IRI. “Hispanic millennials in particular are a very large consumer segment and are very digitally savvy, so our research will help CPGs customize their marketing efforts to achieve optimal results among this core growth target.”
Key findings from HispanicLink identify that Hispanic shoppers plan to increase their online purchases of grocery products from large retailers at a significantly faster pace than non-Hispanic shoppers; at Amazon, the increase is projected to be more than 40 percent. However, Spanish-preferred Hispanics are more resistant to doing so. Overall, Hispanics are also more likely to make comparisons across retailers when buying groceries online, especially those who are bilingual.

Hispanics represent a desirable demographic for CPGs in e-commerce, based on their sheer and growing market size, over-weighting toward youth, spending power and digital engagement. Like the overall population trend, Hispanics also consider convenience an important factor, and they are significantly more likely than non-Hispanics to acknowledge that online grocery shopping is not only easy, but also more convenient than grocery shopping at a physical store. Because of its convenience factor, Hispanics are also more likely to seek out retailers that offer multichannel options, such as “click & collect.”

Results of the HispanicLink survey also found that Hispanics are significantly more engaged throughout the entire shopper journey, both online and offline. Before making a shopping trip, 38 percent of Hispanics search for sales and promotion deals online, primarily through retailers’ websites, while 24 percent compare prices offline. However, Hispanics are more likely to go shopping without a list and their product choices are less likely to be driven by habit than non-Hispanics. Additionally, significantly more Hispanics want access to Spanish translations, both in store and on product packaging, thus making in-store signage, circulars and promotions valuable tools for retailers and packaging important for manufacturers.

IRI’s study also reveals that dollars spent per grocery shopping trip continue to be higher among Hispanics versus non-Hispanics and are growing faster. However, Hispanics make substantially fewer shopping trips, and this decline in trips is accelerating. Survey results showed that English-preferred Hispanics spend the most per trip and Spanish-preferred make the fewest number of trips. These figures indicate stock-up trips to larger format stores and demonstrate the need for CPG manufacturers and retailers to make the most of every trip when targeting Hispanic shoppers.

Hispanics are also significantly more influenced than non-Hispanics by social media, a favorite blog and TV advertisements across grocery categories. When buying beauty/skin care products, for example, 33 percent read a favorite blog, 33 percent got information from social media and 21 percent were influenced by TV ads. These points of engagement represent substantial opportunities for marketers to effectively reach Hispanic shoppers. 

IRI’s HispanicLink suggests four core go-forward strategies for taking advantage of trends among Hispanic shoppers:

  • Make a connection early: Target young Hispanics, “Hispennials,” who tend to seek out large amounts of brand information and engage with them early
  • Embrace Hispanic biculturalism: Make it easy for shoppers to switch between English and Spanish by adapting product packaging, advertising and marketing — and it’s not just about language, but also creating relevant content
  • Create an engaging experience: Offer the opportunity to touch product, design visually interesting displays and promote interaction with in-store personnel
  • Encourage connection throughout the shopper journey: Promote online and offline feedback, provide opportunities to connect with brands and retailers, solicit product and shopping experience reviews and make customer service a priority

The latest HispanicLink survey closely examined the path to purchase for the following categories: food; nonalcoholic beverages; beer, wine and spirits; beauty; health care/over-the-counter medicines; and household cleaning. IRI has been releasing Hispanic insights reports since 2006, to equip CPG leaders with the key insights needed to achieve significant growth through highly effective targeting and activation of Hispanic shoppers.

For more information, please contact Staci Covkin, principal of Consumer and Shopper Marketing for IRI, at Staci.Covkin@IRIworldwide.com.

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E-mail: Shelley.Hughes@IRIworldwide.com
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