There are tremendous opportunities for Hispanic snacks that target non-Hispanic consumers, but products must be spicy and authentic, according to a marketing expert.
In the US there are 53 million Hispanics with a spending power of $1.3 trillion a year and this economy is expected to triple by 2050, according to Nielsen data.
In line with this, the past few years have seen a flurry of new product development and marketing targeting US Hispanic consumers. But Terry Soto, president and CEO of Hispanic-targeted strategy firm About Marketing Solutions, said snack firms should not just target this mounting population.
“The ethnic snack category potential is much larger than just the Hispanic market,” Soto said in her educational session at Snaxpo 2013.
“…The preference for Latin and Mexican [among non-Hispanics] is tremendous. The appetite has grown in leaps and bounds and is expected to grow as a segment by 2% over the next two years.
“It is absolutely a category that is growing.”
The marketing expert said this is based on a strong preference towards ethnic foods – something that has been “brewing for years” – and totted up sales of $3bn in 2011. Mexican and Hispanic foods represented half of these sales.
Heat and authenticity
Soto said there are key attributes that non-Hispanic consumers look for in ethnic, particularly Hispanic, snack products.
“This year alone, heat and authenticity are operative words. There is just this amazing like and appeal for very, very spicy flavors from non-Hispanic consumers.”
However, she said consumers are also demanding complex and interesting flavors as knowledge of chilies and other heat-giving ingredients improves.
A 2011 Mintel survey indicated that 66% of consumers want ethnic foods to be authentic.
Soto said that in order to successfully develop ‘authentic’ flavors, manufacturers – particularly the decision makers – must work hard to understand and have the ability to distinguish true flavors themselves.
Challenges moving forward…
“There’s a huge disconnect between the boomers and the seniors who are sitting in management roles and decision-making roles within corporations trying to relate to and connect to what is now a very diverse community.”
She said these decision-makers must work hard to better understand target consumers and the market in general. “Inspiration can be drawn from understanding Hispanics’ snacking behavior and what non-Hispanics are looking for in Hispanic foods.”