HISPANIC MARKET SNAPSHOT

1
HISPANIC MARKET SNAPSHOT

• A SUMMARY OF KEY FACTS, TRENDS OTHER
• INFORMATION THAT SUBSTANTIATES THE
• OPPORTUNITY PRESENTED BY THE FAST-
• GROWING HISPANIC SEGMENT.

2
HISPANIC MARKET SNAPSHOT

• CONTENT
• MKT SIZE
• MKT GROWTH
• CATEGORY SPENDING INFO
• LATINO DEMOGRAPHICS
• KEY HISPANIC STATES MARKETS
• RETAIL INFORMATION SHOPPING DATA
• MISC/OTHER

3
HISPANIC MARKET SIZE

• Current Hispanic population is almost 41 million
  (excl undocumented estimated at 7- 10 million)
• Hispanics are largest ethnic group in the U.S.
• Hispanic factor changing political landscape,
  cultural mosaic and marketing paradigm in U.S.
• Offers business opportunities across many
  products, categories service sectors for astute
  marketers

4
HISPANIC MKT GROWTH Growing twice as fast as
general population at close to 4/yr
43.0 million
3.4 Yearly Growth
32.0 million
4 Yearly Growth
18.5 million

• Source US Census 2000 Standard Poors DRI,
  The Hispanic Consumer Market in 1999forecasts
  to 2020
• Number based on Top 50 US Hispanic DMAs

5
HISPANIC MKT GROWTH

• From 1990 to 2000 Hispanic population grew 58
• From 1990 to 2000 Hispanic purchasing power grew
  160 to over 428 billion
• Hispanic spending grew 209.3 in period 1990-2004
  vs 95.2 for non-Hispanics
• Latinos are the fastest-growing minority group in
  the U.S. they represent half of the U.S.
  population growth and 14 of overall population
• By 2010, one of every six people will be Hispanic
  origin
• By 2050, the Hispanic population will hit 96
  million, representing nearly ¼ of total U.S.
  population

6
HISPANIC MKT GROWTH

• By 2009, the disposable income of Hispanics will
  grow to 1 trillion 44.6, double
  non-Hispanic growth (or 9 of total purchasing
  power nationwide)
• -Hispanics fueled 35 increase in furniture
  sales in last 5 yrs
• -48 of growth in cereal was due to Latinos in
  same time period
• -Hispanic economic clout growing at annual
  compound rate of 8.2
• nearly twice the 4.9 rate for
  non-Hispanics
• By 2010, Latinos will account for nearly 1/3rd of
  the home buying pool (Clients will finance 44
  billion of mortgages thru loans that accept a
  government- issued alternative to the Social
  Security Number)
• Self-employment by Latinos grew 41 between 2000
  and 2003 while overall self-employment grew 6.2
  Latina-owned businesses surged 62.4 for seven
  yrs ending 2004 (vs 9 for all businesses)

7
HISPANIC MKT GROWTH

• Traditionally growth has been mostly fueled by
  immigration.
• This is still true in newer/emergent markets,
  however native born second generation is
  generating a bigger share of the growth in more
  mature markets and overall
• Hispanic growth between 1990-2000 consisted of
  52.9 foreign born Hispanics and 47.1 US born
  Hispanics
• For 2004, 53 of Hispanic population growth is
  accounted for by births 47 thru immigration
• Going forward, borne in U.S. (ie 2nd, 3rd
  generation, bilinguals) will drive growth

8
U.S. Hispanic population
Source Synovate - 2004
9
HISPANIC MKT GROWTH

• Emerging Markets
• The Hispanic population has tripled in seven US
  states
• Alabama, Arkansas, Georgia, Nevada, North
  Carolina, South Carolina, Tennessee
• Strong Hispanic growth is evident in the
  following markets
• Atlanta, Las Vegas, Portland, Orlando, Salt Lake
  City, Seattle, Dallas, Phoenix, West Palm Beach,
  Tampa
• Many emerging markets are appearing
• Detroit, Charlotte , Raleigh Durham, Dodge City,
  Kansas City, Oklahoma, Amarillo, Detroit, Salem
  and Philadelphia

10
HISPANIC MKT GROWTH

• Reaching The Newer Generation
• More Acculturated US Mexicans
• By the year 2010. . .
• 20 of children under 5 years old. . .
• 18 of all 5-17 year-olds. . .
• 16 of all 18-34 year olds. . .
• 14 of all 35-44 year-olds. . .
• . . .will be Hispanic

11
By 2050, Hispanics 24 total pop ethnic pop
outnumbers whites 218MM vs 210MM
12
CATEGORY/SPENDING INFORMATION

• Over 55 billion spent on food per annum
• 14 more per dollar than Non-Hispanics
• 8 more per household
• Over 35 billion spent on food consumed at home
• 23 more than Non-Hispanic Households
• Food sales projected to grow 6.5 annually
• Hispanics spend relatively more on their
  children
• than any other group

13
CATEGORY/SPENDING INFORMATION

• Amount Latinos spend yearly vs non-Hispanics
• Mens boys apparel - 551 vs 396
• Children under 2 apparel - 142 vs 77 (nearly ½
  of nations children under 5 are racial/ethnic
  minorities)
• Shoes - 521 vs 294
• Groceries Hispanics spend 133/wk vs
  non-Hispanics at 91
• Latinos account for 55 of opening weekend movie
  theatre audience
• Hispanic spending on automobiles other
  transportation will reach 70 billion in 2006

14
HISPANIC DEMOGRAPHICS

• The vast majority of Hispanics are bilingual
  (83)
• Hispanics age 15-34 earn 37 of total Hispanic
  Income, versus 21 for non-Hispanic Whites
• The average Hispanic household has 3.5 persons
  with 1.6 wage earners. Non-Hispanic household
  has 2.4 people with 1.3 wage-earners.
• The US Hispanic population is diverse and
  complex (eg Cubanos, Columbianos, Mexicanos,
  Puerto Ricanos, recent arrivals, 4th generation)

15
HISPANIC DEMOGRAPHICS

• 36,630,000 Hispanics in top 50 DMAs (approx 90
  of Latinos) as of 2004
• US Hispanics are the Worlds 5th largest
• Hispanic market
• The median age for Hispanics is 25.9
• Half of Hispanics are younger than 26 and
• 1/3 are under 18.
• Hispanics are not equally spread
• throughout the US

40,700,000 US Hispanics
Excl un-documented
16
HISPANIC DEMOGRAPHICS
Breakdown of Language Use

• 52 of Hispanic Households
• communicates only or mostly in
• Spanish.
• Only 5 of Spanish dominant
• Households earns more than
• 35,000 a year
• Consumers tend to be living in a
• Spanish Dominant Household

Source Nielsen
17
U.S. Hispanic population
Source Synovate - 2004
18
HISPANIC DEMOGRAPHICS
Hispanics of Mexican Origin (approx 67 of
Latinos)

• 24.1 million US Mexicans
• 11.8 million of Mexican-Americans
• are Mexican born.
• 300,000 Mexicans arrive each year
• (Migration Policy Institute)
• 800,000 to 1,000,000 Mexicans
• make one or more round-trips
• between U.S. and Mexico each year.

24,100,000 Mexicans
Number based on Top 50 US Hispanic DMAs and
excludes undocumented
19
U.S. Hispanic population
NYC Miami only mkts where Mexicans do not
dominate
Source Synovate - 2004
20
U.S. Hispanic population
Source Synovate - 2004
21
HISPANIC DEMOGRAPHICS

• The importance of the new generation and more
  acculturated US Mexicans
• A high percentage of Hispanic teens speak
  Spanish at
• home but Spanglish or English w/friends
  outside
• home
• 9 of the top 10 shows watched by Hispanic teens
  are in
• Spanish and 10 of the top 20 shows
• By 2020, one in four new workers will be the
  child of a
• Latino immigrant

22
GROWTH HISPANIC DEMOGRAPHICS RTUNITIES FOR
Importance of the youth market!
Teen Population Growth 1993-2001
Teen Population Growth 2020
62
10

• Currently there are 2,122,000 Mexican teens
  (12-17yrs) in the US in the top 50 DMAs
• Projections indicate that there will be
  3,437,640 Mexican teens (12-17yrs) by the year
  2020 in the top 50 DMAs

Source AHAA, June 2002 and U.S. Census
23
HISPANIC DEMOGRAPHICS

• The Impact Of Acculturation
• As the market becomes more acculturated mental
  cookbook gets smaller
• Traditional cooking Convenience foods
• Americanized meals
• Shorter cooking times
• Hectic
• Carry-out
• Entertaining less frequent

Source Cultural Insight, Segmentation Analysis
24
HI- HISPANIC STATES MKTS
25
U.S. Hispanic population
Top 50 Markets Ranking by Hispanic Population -
1/1/2004
Source Synovate - 2004
26
California

• 1990
• Total Population 29,760,021
• Hispanic Population7,687,938
• 2000
• Total Population 33,871,648
• Hispanic Population10,966,556
• Growth 1990-2000
• Total Population 4,111,627
• Hispanic Population 3,278,618

Hispanics as a of Total
43 Hispanic Growth
Source US Census, 2000
27
Texas

• 1990
• Total Population 16,986,510
• Hispanic Population 4,339,905
• 2000
• Total Population 20,851,820
• Hispanic Population 6,669,666
• Growth 1990-2000
• Total Population 3,865,310
• Hispanic Population 2,329,761

Hispanics as a of Total
54 Hispanic Growth
Source US Census, 2000
28
New York

• 1990
• Total Population 17,990,455
• Hispanic Population 2,214,026
• 2000
• Total Population 18,976,457
• Hispanic Population 2,867,583
• Growth 1990-2000
• Total Population 986,002
• Hispanic Population 653,557

Hispanics as a of Total
30 Hispanic Growth
Source US Census, 2000
29
Florida

• 1990
• Total Population 12,937,926
• Hispanic Population 1,574,143
• 2000
• Total Population 15,982,378
• Hispanic Population 2,682,715
• Growth 1990-2000
• Total Population 3,044,452
• Hispanic Population1,108,572

Hispanics as a of Total
70 Hispanic Growth
Source US Census, 2000
30
Illinois

• 1990
• Total Population 11,430,602
• Hispanic Population 904,446
• 2000
• Total Population 12,419,293
• Hispanic Population 1,530,262
• Growth 1990-2000
• Total Population 988,961
• Hispanic Population 625,816

Hispanics as a of Total
69 Hispanic Growth
Source US Census, 2000
31
Arizona

• 1990
• Total Population 3,665,228
• Hispanic Population 688,338
• 2000
• Total Population 5,130,632
• Hispanic Population 1,295,617
• Growth 1990-2000
• Total Population 1,465,404
• Hispanic Population 607,279

Hispanics as a of Total
88 Hispanic Growth
Source US Census, 2000
32
Los Angeles, CaliforniaRank 1

• 1990
• Total Population 15,093,827
• Hispanic Population 4,932,649
• 2000
• Total Population 17,053,235
• Hispanic Population 6,854,781
• Growth 1990-2000
• Total Population 1,959,408
• Hispanic Population 1,922,132

Hispanics as a of Total
39 Hispanic Growth
Source US Census, 2000
33
New York, NYRank 2

• 1990
• Total Population 18,556,988
• Hispanic Population 2,798,716
• 2000
• Total Population 20,181,238
• Hispanic Population 3,750,741
• Growth 1990-2000
• Total Population 16,14,250
• Hispanic Population 952,025

Hispanics as a of Total
34 Hispanic Growth
Source US Census, 2000
34
Miami, FloridaRank 3

• 1990
• Total Population 3,270,606
• Hispanic Population 1,071,426
• 2000
• Total Population 3,955,969
• Hispanic Population 1,575,942
• Growth 1990-2000
• Total Population 685,363
• Hispanic Population 504,516

Hispanics as a of Total
47 Hispanic Growth
Source US Census, 2000
35
Chicago, IllinoisRank 4

• 1990
• Total Population 8,394,916
• Hispanic Population 898,096
• 2000
• Total Population 9,305,521
• Hispanic Population 1,499,315
• Growth 1990-2000
• Total Population 910,605
• Hispanic Population 601,219

Hispanics as a of Total
67 Hispanic Growth
Source US Census, 2000
36
Houston, TexasRank 5

• 1990
• Total Population 4,021,279
• Hispanic Population 818,601
• 2000
• Total Population 5,006,796
• Hispanic Population 1,413,293
• Growth 1990-2000
• Total Population 985,517
• Hispanic Population 594,692

Hispanics as a of Total
73 Hispanic Growth
Source US Census, 2000
37
RETAIL INFORMATION SHOPPING DATA
38
Source New American Dimensions/ADVO Study 2004
39
Compared to non-Hispanics, Hispanics Are Big
Spenders on Groceries
Total Weekly Dollars Spent on Groceries
Trends in the United States--Consumer Attitudes
the Supermarket, 2004
40
Age and Family Size, Rather than Income,
Determine How Much Families Spend Dollars Spent
per Week
18-24
25-39
40-49
50
lt25K
25K-50K
gt50K
1
2
3
4
Total Number of People in Household
Age
Income
41
Lower Income Hispanics Spend More Than One
Quarter of Their Total Income on Groceries
Percentage of Total Household Income Spent on
Groceries
42
Hispanics Spend a Significantly Larger Proportion
in Secondary Grocery Outlets Than
Non-Hispanics Weekly Grocery Expenditures
18
Secondary Outlet Spending
34
82
Primary Outlet Spending
66
Trends in the United States--Consumer Attitudes
the Supermarket, 2004
43
Hispanics Shop for Groceries in a Variety of
Outlets visiting in last month
Supermarkets
Discount Superstores
Drug Stores/Pharmacies
Bodegas/Corner Stores
Meat Shops/Carnicerias
Bakeries/ Panaderias
Warehouse Clubs
Limited Assortment Stores
Convenience Stores
Specialty Stores

44
Nearly Half of Hispanics Do Their Primary
Shopping on Weekends
Saturday
Sunday
Monday
Friday
Wednesday
Tuesday
Thursday
45
40 of Hispanic Grocery Shopping Visits Are Made
at Bodegas and Supermarkets Average Number of
Visits per Outlet per Month
Bodegas/Corner Stores
Supermarkets
Bakeries/Panaderias
Meat Shops/Carnicerias
Discount Superstores
Convenience Stores
Drug Stores/Pharmacies
Limited Assortment Stores
Warehouse Club Stores
Specialty Grocery Stores
46
With 26 Grocery Shopping Trips per Month,
Hispanics Shop Nearly Every Day. The US Market
Average is Less Than 9. Average Number of Visits
per Outlet per Month
47
Unacculturated Hispanics Primary Store is an
Ethnic Format, while Acculturated Hispanics
Prefer Chain Supermarkets
Top Primary Grocery Store Type In Each U.S. Market
48
A Clean, Friendly Store with Lots of Fresh Meat
and Produce is What Most Hispanics Want Answered
Very Important
A clean/neat store
Has fresh, high quality fruits and vegetables
Courteous friendly employees
Has fresh, high quality meats and poultry
Low Prices
Has fast checkout
Convenient Location

49
Hispanic Elements Are Also Important,
Particularly with the Less Acculturated Answered
Very Important
Bilingual Employees
Sells Hispanic Products
Bilingual Store Signs
Bilingual Packaging on Food Products
Store active in local community
Carries imported products from Latin America
50
Coupon Usage Increases With The Number of Years
Spent in the United States But Non-US Born,
That Use Coupons, Answered Everytime or Fairly
Often
0-4 Years
5-9 Years
10-15 Years
16 Years

51
Over Half Rarely if Ever Use Coupons
Use Coupons Every Time
Use Coupons Fairly Often
Sometimes Use Coupons
Rarely Use Coupons
Never Use Coupons

52
Mail-In Rebates are Used Even Less
Use Mail-In Rebates Every Time
Use Mail-In Rebates Fairly Often
Sometimes Use Mail-In Rebates
Rarely Use Mail-In Rebates
Never Use Mail-In Rebates

53
Hispanics Spend More On Groceries Than General
Market Shoppers
Weekly Grocery Expenditures
117
Primary Store - 80
Primary Store - 73
94
Primary Store - 77
87
Source Cultural Insight, Segmentation Analysis
54
Top 5 Channels Number Of Store Visits For
Groceries In The Past Month
Supermarket
Bakery
Butcher Shop
Corner Store
Discount Store
Source Cultural Insight, Segmentation Analysis
55
Hispanics Make More Trips To The Supermarket
Total Number of Trips Per Month
Total Number of Trips Per Week
Hispanic Shoppers
Hispanic Shoppers
U.S. Shoppers
U.S. Shoppers
Source Cultural Insight, Segmentation Analysis
56
Factors Rated Very Important By Hispanics In
Deciding Where To Shop
Bilingual Employees
Knowledgeable Employees
Sells Hispanic Products
Bilingual Store Signs
Bilingual Packages
Imported Food
Source Cultural Insight, Segmentation Analysis
57
Shopping Motivators
Bilingual
Spanish-Dominant
English-Dominant

• Has Reasonable Prices
• Spanish-Speaking Employees
• I can trust the prices
• Treats Customers with Respect
• Is near where I live or work

• Has Reasonable Prices
• I can trust the prices
• I can always find what I want
• Treats Customers with Respect
• Doesnt pressure me to buy anything

• I can always find what I want
• Has reasonable prices
• Is near where I live or work
• I can trust the prices
• Treats customers with respect

Source 2000 Yankelovich Hispanic MONITOR
58
Type of Food Eaten At Home
Other 2
Asian 2
Do not know 1
Italian 2
American 8
Hispanic 85
Source Cultural Insight, Segmentation Analysis
59
Other Interesting Hispanic Shopping
Characteristics

• Six out of 10 set a budget for groceries.
• Half of U.S. Hispanics prepare a shopping list.
• Just over four in 10 look at fliers delivered to
  the home and compare prices at different stores
• Half of U.S. Hispanics buy only what is on their
  shopping list.
• 1/3 buy products on special even if they had not
  planned to.
• 31 of U.S. Hispanics stock up on an item when
  they find a
• bargain.

60
Other Interesting Hispanic
Shopping Characteristics

• 63 of Hispanics express enjoyment of food
  shopping
• Tend to spend a longer time in the markets
• More likely to appreciate in-store displays
• Tend to shop together as families
• Tend to cook at home more and eat out less
• Hispanics are more brand loyal / brand conscious
  than other groups

61
Other Interesting Hispanic Shopping
Characteristics

• Distribution channels, other than independent
  grocery trade, will play
• increasing role w/more acculturated US
  Mexican-Americans
• Chains (SafeWay, Albertsons, Vons)
• Club stores (Sams, Cosco,)
• Mass Merchandisers (WalMart, Target)
• Convenience stores (7/11, Circle K, Chevron,
  Valero...)
• Fastfood (Taco Bell)
• Vending
• Bakeries
• Delis

To reach consumers, products have to be available
where they shop or consume
62
MISC/OTHER

• Hispanic LA rank among the nations largest
  cities 6
• -Of every 100 new Angelinos, number that are
  Hispanic 98
• -Latino population in California comprises
  32 of states 33.8 million
• people (by 2040, half of Californians will
  be Latino)
• -US Cities smaller than LAs Hispanic
  population Philadelphia,
• Boston, Detroit, Dallas
• Percent of population in Chicago of Hispanic
  origin in 1990 11
• -Percent population in Chicago of Hispanic
  origin in 2000 16.1
• -Percent of Chicagos population growth
  from Hispanic segment 66
• Percent of Lubbocks population growth from
  Hispanic
• segment 100

63
MISC/OTHER

• 70 of population increase for children younger
  than 5 is driven by Hispanics
• Each year over 1 million children are borne to
  Hispanic mothers
• 44 of Hispanics watch Spanish-language soap
  operas
• ½ of Hispanics (2002 data) had access to internet
  at home, work or at cyber cafe
• -Latinos on line 9.2 hrs/wk (vs 8.5 for anglos)
• -56 of Hispanics on line are aged 18-34 (vs
  34 for general)
• -55 use internet to listen to music (vs 41
  for general mkt)
• -Half of on-line Hispanics going online are
  doing so over hi-speed
• connections at home (despite
  fact that Hispanics are relatively newer to
• internet)

64
MISC/OTHER

• 1/3rd of U.S. borne Hispanic residents and over
  half of all Mexican immigrants lack bank accounts
• The average net worth of Hispanic households
  nationwide is 8,000, while for Anglo households
  its almost 89,000

65
Hispanic Market Snap Shot Compiled by Procom

• Procom takes sole responsibility for any errors
  or omissions.
• For more information
• Robert Leppan, President
• Voice [phone] Email
  robert.procom_at_gmail.com