By Peter Filiaci
Last week we joined the Restaurant Leadership Conference for a session on Hispanic consumers. More than 700 restaurant operators attended our session as we brought top marketers to the stage to discuss their winning strategies.
I was excited to lead a panel discussion with Vice President of Brand and Field Marketing for Denny’s, John Dillon; Vice President of Product Management/Food Service at NPD Group, Kelley Fechner; Senior Vice President/CMO of Pepsi Foodservice, Roberto Rios; and Vice President of U.S. Marketing for McDonald’s, Adam Salgado. Our topic: “Your Consumers Have Changed. Are you Changing with Them?” With Hispanic America expected to grow 19% in Adults 18-49 and 18% in Adults 18-34 through 2014 – while the non-Hispanic population remains flat or declines over the same time period – connecting with this consumer will increasingly be a business imperative.
With Hispanics fueling growth in the young adult demographics, they will need to be part of any strategy for restaurants seeking sustainable growth in traffic. According to NPD, in 2013 Hispanic consumers accounted for 18% of traffic and 19% of dollars at QSR. At Casual Dining, those numbers are both 12%, partly because fewer brands are directly targeting this consumer with culturally-relevant marketing campaigns. Those that do – and do soon – will likely reap first-mover benefits.
Now…enough of the set up. Here are the key takeaways from our esteemed panelists.
Hispanic Marketing is an “And” Not an “Or.” That’s what Rios said so eloquently when he shared how Pepsi supports the NFL and Mexican League Soccer. All of our marketers spoke about their total market approach where Hispanic efforts are baked into their process. For example, if digital is a strategy for the general market, they found ways to adapt, extend or launch new concepts in Spanish-language digital campaigns.
Lead with Ethnic Insights and the Total Population will Follow. Things like passion for soccer, music, family or Hispanic celebrities will take your campaigns far – maybe even farther than you think. Dillon said that Denny’s popular Skillet Whisperer campaign featuring Dog Whisperer Cesar Millan originated with the Hispanic agency in Spanish, but it did so well that it ran in English, too. Rios also talked about Pepsi’s Culture Labs, physical environments set up to engage young multicultural millennials and spot trends early.
Enrolling Franchisees is Mutually Beneficial. McDonald’s Salgado said that while the corporate offices do a lot to educate the field on how to connect with Hispanics, the learnings travel from the field up, too. That’s probably because in many of McDonald’s key markets, Hispanics today account for anywhere from a quarter to half of the young adult population. One example Salgado shared was the Hacer Scholarship program, which helps Hispanics go to college. The idea started local and went national, and you can watch the commercial here.
Own Your Metrics. All of the panelists work with NPD Crest to understand Hispanic restaurant behavior. They also supplement with their own research and tools. Dillon demoed the Denny’s Hispanic Penetrated Units dashboard, which goes deep into local markets to understand the ethnic composition of the market, the consumer demo, local media delivery, sales and traffic and how promotions are tracking.
Understand Hispanic Restaurant Drivers. Through NPD and our own QSR and Casual Dining Landscape studies, we have a full picture of why Hispanics try, buy and return. Elements like being a good place for a group social experience with friends and family, fresh food and feeling invited rank highly across the board. Fechner also shared that Hispanics are looking for more occasions – like early morning, late night and happy hours – and are more likely to add beverages and desserts to their orders. And digital communications are a important way to develop ongoing relationships with these mobile-savvy consumers.
Don’t Overcomplicate It. Don’t let fear of the unknown delay you one moment longer. It’s not about a total menu overhaul or fully-translated menus and signage. In fact, Salgado said that when McDonald’s tried to mimic food from home they weren’t as successful. Hispanic consumers told them: “I give you permission to use my culture to develop Latin ‘inspired’ products.” We’ll stay tuned for that Horchata Frappe coming soon! Dillon agreed that it’s really about being smart about your high-Hispanic density units and adding “inviting” touches – like condiments. But what Hispanic consumers truly love about Denny’s is its All-American Diner experience.
These marketers are seeing consistent results from Hispanic consumers. Your business can benefit as well.