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Ethnic Food Choices Abound in the Marketplace

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As the ethnic population in the United States continues to grow, so does the popularity of ethnic foods and cuisines. Favorites like tacos, sweet and sour chicken and pad Thai are becoming the norm, not the exotic.

Last updated on September 5th, 2012 at 02:54 pm

by Ashley Bates/staff writer

As the ethnic population in the United States continues to grow, so does the popularity of ethnic foods and cuisines. Favorites like tacos, sweet and sour chicken and pad Thai are becoming the norm, not the exotic.

The ethnic food segment continues to grow due a combination of factors, according to the International Dairy Deli Bakery Association (IDDBA). Among them are an increase in immigrants, international travel, more interest in cooking and TV cooking shows, and new product development of ethnic seasonings, sauces and kits that simplify preparation.

The popularity of ethnic food is clear, as sales of sauces and marinades in the supermarket is off the charts, according to research firm Mintel. It reports that the cooking sauces and marinades category gained 20 percent in U.S. retail sales between 2005 and 2010 and is expected to increase by another 19 percent by 2015.

The IDDBA’s “What’s in Store 2011” report, citing Mintel’s “Ethnic Foods-U.S.” report, predicts that “sales of ethnic foods will continue to grow, posting a total increase of almost 20 percent ­between 2010 and 2014” (or annual growth rates between 3 and 4 percent).

Targeting ethnic cuisine lovers with product-specific merchandising has become a very important piece of the advertising and marketing puzzle in the marketplace.

The IDDBA report states that Mexican/Hispanic foods made up almost 62 percent of ethnic food sales, but growth was strongest for Indian food (35 percent total growth between 2006 and 2008) and Asian food (11 percent total growth in the same time period).

Census confirms remarkable Hispanic population growth

More than half of the growth in the total U.S. population between 2000 and 2010—27.3 million people—was due to an increase in the Hispanic population, according to the U.S. Census Bureau. The total population of the U.S. in 2010 was recorded as 308.7 million people, and Latinos now make up 16-18 percent of the total population.

Between 2000 and 2010, the Hispanic population grew by 43 percent, from 35.3 million to 50.5 million people. The Hispanic population of the U.S. is larger than the entire population of Canada (about 33.8 million).

By 2050, it is expected that the Hispanic population within the U.S. will number 132.8 million.

Within the next decade, Latinos will become the majority in California and Texas.

The Hispanic population grew in every region of the U.S. between 2000 and 2010, and most significantly in the South (57 percent) and Midwest (49 percent), according to the U.S. Census Bureau. The rate of growth was slower in the West and Northeast, but those regions still saw ­significant increases in the Hispanic population, growing by 34 percent and 33 percent, ­respectively, between 2000 and 2010.

Hispanic influences seen in market offerings

Hispanic consumers’ spending power is $950 billion, as reported earlier this year by Symphony IRI Group and Synovate, and is expected to grow to $1.2 trillion by 2012.

The Nielsen Co. found that Hispanics shop less often than other ethnicities, but spend more on each trip and annually. English-preferred Hispanics are more frequent shoppers in supercenters, mass merchandisers and drugstores, while Spanish-preferred Hispanics outpace English-preferred in trips to dollar stores, convenience/gas stations and warehouse clubs.

Hispanic households spend disproportionately more than the U.S. average on staple ingredients such as dried vegetables and grains, shortening oil, flour and seasonings and spices. They also buy more men’s and women’s beauty products and baby-related items than the average U.S. consumer.

Porter Novelli recently released its Amplify report, “Census: It’s All in the Numbers,” which ­investigates the buying power and influence of the Hispanic market in the U.S. The report makes a strong case for the importance of the Hispanic market for sustained growth and brand health.

Retailers who want to take advantage of this growing segment might consider developing Hispanic-American products under their own brands.

For example, Wisconsin cheese makers have begun producing many varieties of Hispanic cheeses. Queso Blanco, Queso Fresco, Anejo Enchilado and Oaxaca are now being produced in the state.

The Wisconsin Milk Marketing Board (WMMB) says the products appeal not only to Hispanic ­customers, but also to gourmet food shoppers who prefer to cook with authentic ingredients.

“Obviously, the burgeoning Hispanic population in the U.S. is a major factor in the growth of these cheeses,” said Marilyn Wilkinson, director of national product communications for the WMMB. “The awareness of these cheeses in the broader population has also ­ignited a desire for their versatility, unique flavors and convenience far beyond the traditional Hispanic niche. One major asset of the cheeses is their mild flavors, which complement rather than compete with bolder flavors used in many Latino dishes.”

Bakeries also have jumped on board across the country, offering more Hispanic and kosher items, the IDDBA reports.

“More mainstream bakeries are expanding their ethnic specialties to include Hispanic and Asian fare along with the more traditional mix of French, Italian and Jewish food cuisine,” the “What’s in Store” report states. “Bakery manufacturers have added Hispanic product lines and more ­bakeries are offering traditional Mexican bakery products such as bolillos (crusty sandwich bread) and conchas (sweet breads), and galletas and polvorones (cookies).”

The influence is not just seen in traditional grocery products. Cummins-Allison (C-A), a maker of self-service coin kiosks, uses ethnic merchandising in its marketing plan to increase traffic to the company’s machines. The kiosks made by C-A are sold to independent or chain grocery stores and convenience stores as well as other retail outlets. C-A allows the store to set fees and manage features, such as languages and custom graphics. The company also provides promotional materials available in two standard language formats: bilingual (English/Spanish) and English.

The self-service kiosks also come standard with multiple language options on all touch screens, ­giving store owners the option to display more than one language onscreen and on printed receipts. The Money Machine allows as many as five languages to be displayed at once.

Mintel reports that there is no longer a “digital divide” between Hispanics and the U.S. population as a whole. One in five online Hispanic men use only a smartphone to connect to the internet, while 30 percent of Hispanic women use a cell phone as the primary device for getting online.

Hispanics text more than any other race/ethnicity, with 943 texts a month, and they use a wide range of mobile activity, including mobile banking, Nielsen reports. Forty-five percent of Hispanics have smartphones, on par with the Asian-American population in the U.S.

Asian population growing faster than other major race groups

Approximately 14.7 million people identified their race as Asian alone in the 2010 U.S. Census count. Asians gained the most in share of the total population, moving up from about 4 percent in 2000 to about 5 percent in 2010.

The Asian-alone population grew faster than any other major race group between 2000 and 2010, increasing by 43 percent. The Asian-alone population had the second-largest numeric change (4.4 million), growing from 10.2 million in 2000 to 14.7 million in 2010.

This demographic has higher birth rates and shows a disproportionate amount of sales for baby categories, The Nielsen Co. reports.

Asians/Pacific Islanders offset slightly lower per-trip spending with more frequent shopping than White Non-Hispanics.

Asians also get the biggest bang for their buck, buying close to 31 percent of purchases on deal, according to Nielsen.

Asian/Pacific Americans bring home far more fresh produce, nuts, dried fruit, pasta, yogurt, soup and juice/drinks compared to the U.S. average. Their spending on skin care and oral hygiene also index well above average, Nielsen reports.

Asians/Pacific Islanders are the most active PC and internet users, spending nearly 80 hours on PC in February 2011 vs. the national average of about 55 hours. They also consume more internet content than any other group, visiting 3,600 web pages in February—about 1,000 more than their counterparts. Although they watch the least amount of TV (3 hours and 14 minutes per day), they stream the most online video, averaging 10 hours and 39 minutes in February—more than double the overall mean of 4 hours and 20 minutes, Nielsen reports.

African-Americans shop more places, more often

The black or African-American population totaled 38.9 million and represented 13 percent of the total population in the 2010 Census. The Nielsen Co. reports that African-Americans shop more frequently than other ethnicities, but spend less on each trip and on an annual basis. Compared to other households, African-Americans make relatively fewer trips to major channels like grocery stores and supercenters, but are more frequent shoppers in smaller retailers like drug stores, dollar stores and convenience/gas outlets. Spending on basic food ingredients, non-alcoholic beverages, and personal and beauty care products exceeds the U.S. average.

Nielsen also reports that African Americans are the heaviest TV consumers, watching 6 hours and 54 minutes a day vs. the average for all U.S. households: 5 hours and 11 minutes. They also use more voice minutes than other groups (1,261 minutes per month), according to Nielsen.

Lesser-known products move into grocery aisles

Mintel reported earlier this year that lesser-known ethnic fare is growing in popularity. Mintel’s Global New Products Database (GNPD), tracked a 150 percent increase in 2010 vs. 2009 in new food items that contained “Caribbean” in the product description. “Japanese” product launches soared more than 230 percent from 2009-10. Meanwhile, “Thai” product launches saw a 68 ­percent increase from 2009-10.

“Italian, Mexican and Asian cuisine are the more mainstream, popular ethnic cuisines,” says David Lockwood, senior analyst at Mintel. “But Thai, Caribbean and Japanese foods are seeing healthy growth, and consumers seem to be getting more comfortable with a wider ­variety of ethnic flavors.”

Twenty-six percent of ethnic food lovers say they were introduced to the cuisine by TV programs, newspapers or magazines that feature cuisine from other countries, according to Mintel.

Another 23 percent read cookbooks with recipes for dishes popular in other countries; 18 percent brought their new love for ethnic food home from a trip abroad; and 25 percent say they live in a diverse neighborhood where varied ingredients are readily available.

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