A new comprehensive report from Nielsen provides strategic insights for retailers seeking to leverage new growth opportunities across the perimeter, over the next several decades, by engaging multicultural consumers, the fastest-growing segment of the U.S. population and the growth engine for the supermarket perimeter, encompassing meat, produce, seafood, deli and bakery.
According to “A Fresh Look at Multicultural Consumers,” multicultural households spend a higher share on fresh foods as a percentage of their total food spend, versus non-Hispanic white households. In fact, multicultural consumer shoppers make 3 percent more trips to stores with fresh items and spend 4 percent more annually on fresh items, leading to a $2.2 billion opportunity for retailers.
The reason for this is that fresh foods are, for many multicultural families, a dietary mainstay, embedded in the cultures of African-Americans, Asian-Americans and Hispanics, among others. Additionally, the appeal of multicultural flavors and demand for fresh food are influencing a wider range of shoppers, and becoming a key driving force for fresh food category growth.
“In order to tap this critical market, retailers need to rethink their delivery and assortment strategies of fresh products being offered to today’s increasingly multicultural shoppers,” noted Courtney Jones, VP of multicultural growth and strategy at Schaumburg, Ill.-based Nielsen. “To be successful, retailers must understand the importance that culturally relevant, fresh offerings play in the multicultural shopper landscape. Retailers must also embrace the many layers of multicultural consumers and the undeniable ‘halo effect’ that those consumers are having on mainstream non-Hispanic white shoppers. The multicultural consumer covers a broad spectrum, from multigenerational families to Millennials, to Asian-American, African-American, and Hispanic subgroups that have been influenced by distinct global culinary traditions. Retailers must consider the multiethnic tastes of their current and desired customers and recognize that the palates that favor multicultural flavors are influencing the taste preferences of non-Hispanic whites and society at large.”
Key insights from the report include that multicultural consumers are availing themselves of the convenient meal solutions and meals for large families within the deli; social media influencers and popular restaurant flavor trends are invading the produce section, resulting in such trends as the growth of Habanero peppers; multicultural consumers spend more in meat and seafood departments than in any other fresh department, with a preference for made-to-order, unbranded meat products, usually prepared behind the counter; and as the bakery offers the biggest opportunity for multicultural consumers, who spend only 9.8 percent of their fresh dollars there, grocers should leverage the department’s proximity to the deli to create strong cross-department connections for multicultural shoppers across various entertaining categories.