Five tips for promoting alcohol products to Hispanics
By Juan Lezama
May 14th, 2012
- More drinkers to come: The percentage of drinking-age adults who are Hispanic is expected to grow from 16 percent in 2010 to 30 percent by 2050. This increase presents a lucrative opportunity for the beverage industry, but also means more steep competition as brands try to capitalize on the growth. These market changes reveal the importance for companies to develop culturally relevant communications for the Hispanic community with a clear understanding of the sensitivities of this unique consumer.
- Cerveza is king, but wine and spirits consumption is growing: Traditionally, Hispanics are beer and tequila drinkers. Beer enjoys strong preference across the board. However, with the rise in income among Hispanic millennials and overall influence of the general market, sales figures show growing interest in other beverage choices. In spirits, Hispanic spending totals about $4 billion and is growing by about 10 percent annually. U.S. Hispanic alcohol preferences mirror that of the general market particularly among the U.S. born, English-fluent Hispanics. Hispanic wine consumption has increased by nearly 35 percent since 2005. Non-Mexican Hispanics account for the most significant increase in wine consumption. Vodka preferences rival that of other ethnicities among Latinos 21-34, however not for older Latinos. Growth of tequila consumption among Hispanics is about 8 percent. Tequila consumption is strong among Mexicans, even the priciest brands tend to do well at retailers that traditionally target low- and middle-income consumers.
- Brand Equity crosses the border: Mexican brands such as Corona or Tecate have an advantage in appealing to recently arrived immigrants. They are capitalizing on their brand equity in Mexico to help attract the immigrant Hispanic consumer market. Hispanics are more likely than non-Hispanics to purchase imported brands (25 percent vs. 13 percent, respectively). To reach recently immigrated consumers, Mexican brands can consider themes of nostalgia and Mexican national pride in developing their communications. However, data shows U.S. born Hispanics tend to prefer domestic beers and are increasingly driven by price points.
- Community is important: Hispanics are by nature community-oriented and like to forge strong ties. This makes them loyal consumers to a brand they feel they can identify with and trust, even if they have to pay more for it. Companies that have reached out to the community not only via marketing, but through corporate social responsibility programs have benefited. Anheuser-Busch is one of the companies that support the Hispanic Scholarship Fund and continues to grow their efforts investing in the community through CSR programs. CSR programs should definitely be considered as part of a strategy to establish a long-term relationship with Hispanics.
- Socializing is important also online: Hispanics are culturally highly social. This socializing also transfers to social media and mobile usage. Facebook is experiencing Hispanic growth by 125 percent annually and YouTube by 25 percent annually. 82 percent of Hispanics use mobile phones; this is on par with the general population, and 53 percent are using smartphones. Hispanics also outpace all other ethnic groups in mobile downloads of music and photos, and are more likely to watch a video online on their mobile phones than others. They also over-index in their use of SMS and phone calls. When developing a communications plan, a social media/mobile component should be a priority.
These changes are exciting and present a world of new opportunities for beverage makers. The Hispanic market is more powerful and vibrant than ever, and with the right recipe, brands can keep this important market coming back for more. ¡Salud!