Can CPG Brands Stop Waning Hispanic Brand Loyalty?

March 2, 2017 Author: Mario X. Carrasco

ThinkNow Affinity™ Brand Loyalty Study suggests a shift in consumer behavior

If there is one “truth” that has persisted in multicultural marketing throughout the decades, it is the assumption that less acculturated Hispanics are more brand loyal than their bicultural and more acculturated Hispanic counterparts. But this persistent trope has trickled outside of the confines of Hispanic marketing. Less acculturated Hispanics are now considered the most brand-loyal consumer segment out of non-Hispanic whites, Asians, and African-Americans.

But where did that ideology come from? Let’s look at the genesis of how this may have come about. Less acculturated Hispanics are typically the recently immigrated population in the U.S. Because they are unfamiliar with the brands in the U.S., they look to advertising to help guide their purchasing decisions.

Highly visible brands compete for mindshare among less acculturated Hispanics. Top performing brands became “top” of mind as less accultured Hispanics assimilate to life in the U.S., creating loyalty that will last throughout the consumers’ lifetime and potentially to future generations as they pass down these purchasing habits.

In theory, it all makes sense. But, as we’re seeing across several consumer verticals right now, behavior is changing.

Our recent study, ThinkNow Affinity™, which analyzed brand loyalty across the Total Market, looked at several core CPG categories, specifically:

  • Toothpaste
  • Laundry Detergent
  • Bottled Water
  • Toilet Tissue
  • Shampoo
  • Dishwashing Soap

Not the most exciting categories, but these staples don’t change much over time and is something almost everyone purchases. This gives us a good pulse on brand loyalty vs. brand loyalty of products in constant flux.

But before we dive into the insights gleaned from specific Hispanic segments such as Less Acculturated and Bicultural, let’s look at brand loyalty across the Total Market:

Brand Switching

Non-Hispanic Whites show the highest level of loyalty overall. This goes against what multicultural marketers have traditionally thought. This new reality becomes even more interesting when we break out loyalty by Hispanic sub-segments:

Brand Purchase

Interestingly, Bicultural Hispanics now rise to the top regarding brand loyalty, with almost 40% of Bicultural Hispanics indicating that they will go to another store or come back another day if the brand they usually buy was not available where they regularly shop.

Conversely, 35% of Less Acculturated Hispanics indicated the same. The difference becomes more pronounced, however, when we look at those who stated that they would go to another store to buy the brand they usually buy, which would suggest a higher level of brand loyalty. Only 18% of Less Acculturated Hispanics indicated that they would do that vs. 22% of Biculturals.

This research suggests that brand loyalty among various Hispanic sub-segments is changing. Relying on dated marketing perceptions spell trouble for your next campaign. To stimulate brand loyalty among all segments of the U.S. Hispanic population will always boil down to cultural relevance and a deep understanding of what drives their purchasing behavior. And the best way to do that – research.

Download the report here for additional insights:

Download this study.