March 8, 2012 by The Sacramento Bee, PR Newswire.
AHAA: The Voice of Hispanic Marketing has released its second comprehensive study which revealed a positive connection between corporate Hispanic marketing and revenue growth specific for Consumer Packaged Goods (CPG) and CPG-based retail companies. In fact, the data showed a significant difference in the revenue growth rate attained by CPG companies which designate a higher focus to the Hispanic market than those corporations who focus less.
“This new information is compelling because the data indicates that the Hispanic market can be a big determinant in corporate success,” said Roberto Orci, chair of AHAA and CEO of Acento Advertising. “CPG companies not only want to gain market share among their competitors but they also want to provide growth and stability for their investors – investing in Hispanic marketing is a clear strategy in achieving that two-fold objective.”
The study analyzed the top 500 overall U.S. advertisers between 2006 and 2010. The regression model showed similar correlation findings and significance levels for the CPG set of companies when tested against the full sample of consistent top advertisers for the same time period. The study found, with a 95 percent confidence level, that among CPG brands, the share of overall marketing resources dedicated to the booming Hispanic segment explains about a third of their overall revenue growth.
“The connection is clear and very significant,” said Dr. Cristina Garcia, professor of statistics at USC, who oversaw the methodology of the study. “The study found evidence that the proportion of resources a company, irrelevant of market category, puts behind Hispanic consumers is an essential driver for sustainable growth performance.”
Effective growth leaders consistently put higher focus on creating solid relationships with the valuable Hispanic consumer base. Conversely, CPG underperformers tend to overlook Hispanic growth opportunities resulting typically in sluggish growth, and by consequence, slower value creation to their shareholders.
Approximately 39 Consumer Packaged Goods companies and retailers were included in the final study, a subset of 211 public companies with consistently advertised in Hispanic media between 2006 and 2010. The study identified seven companies as best-in-class, driving the highest overall organic revenue growth from their consistent leading efforts in the Hispanic market, including Coca-Cola, General Mills, Ralcorp, Groupe Danone, Nestle, Walmart, and Walgreens. Other companies analyzed include Clorox, Unilever, Kimberly-Clark, Target, Church & Dwight, CVS, Hormel, PepsiCo, Kellogg’s, Diageo, Pernod Ricard, Sara Lee, Fortune Brands, Rubbermaid, NutriSystem, ConAgra, Campbell’s, Hershey’s, Loreal and Estee Lauder, among others.
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CPG Hispanic Allocation