Keep in mind 4 things prior to launching a line solely for Latinos as the strategy to grow your brand’s Hispanic market share.
The recent buzz about the success of Hispanic malls and J.Lo’s Viva Movil Hispanic-targeted cell phone shopping experience, or Mintel data showing that 20% of Latinos would like to see more personal care products designed just for them may lead you to think that you need to launch Hispanic-targeted products to grow your brand’s market share among Latino consumers. Before proceeding, make sure you have covered your bases in 4 areas:
- Know which of your mainstream items have higher sales in “Hispanic” vs. “non-Hispanic” stores. It is easier to convince a retail buyer to tweak the on-shelf and display assortment in “Hispanic” stores to showcase items that are already selling and have a proven appeal to Hispanics. Plus, your brand’s sales will increase simply because you will make it easier for Latinos to buy the products that they already like, especially if those items are also featured on in-store imagery and advertising.
- Understand your retailer’s “Hispanic” store classification. The impact of your new Hispanic-targeted items will be more noticeable at chains where at least 1/3 of stores are designated as “Hispanic” and when at least half of those “Hispanic” stores are in trade areas where Latinos represent 25% or more of the population. If your retailer does not meet this criteria, it may be better to focus your Hispanic strategy on your mainstream items that over-index among Hispanics.
- Negotiate success thresholds with your retail buyer. Many lines developed specifically for Hispanics do not survive on shelf because buyers make planogram decisions based on overall item rankings, instead of assessing sales performance separately in “Hispanic” vs. “non-Hispanic” stores. For example, black haircolor SKUs do not yet make the national Top 10 but rank #1 or #2 in “Hispanic” and “African-American” doors. Also, make sure that your Hispanic brand is evaluated using success benchmarks for other “ethnic” items vs. standard general market thresholds.
- Develop lines with key benefits for Latinos that also appeal to a broader audience. This will insure you against discontinuation while expanding distribution of your targeted brand to stores where Hispanics are 10-25% of shoppers. For example, L’Oréal Paris carved a lasting space for its high intensity pigment (HiP) cosmetics by changing its positioning from “for women of color” to “for women who love color”.