This post is sponsored by Acosta.
As the US population is becomes increasingly diverse, the preferences of multicultural consumers will have a significant impact on the future of grocery retail, according to Acosta’s first-ever Multicultural The Why? The Behind The Buy report.
The US population is expected to grow by 98 million people between 2014 and 2060, with the younger generations being significantly more diverse. Forty-four percent of millennials and 47% of those in Generation Z consider themselves multicultural, compared with 39% of those in Generation X and just 28% of Boomers. More African American, Asian American and US Hispanic consumers are users of technologies that are already transforming the grocery shopping experience, and their comfort with digital — combined with an affinity for shopping across multiple channels and seeking out healthy foods — will be key to retailers’ and manufacturers’ strategies for targeting the next generation of consumers.
“The growing multicultural population will drastically impact the grocery industry, and we have already noticed key differences between shopper groups,” said John Clevenger, senior vice president/managing director for Acosta Strategic Advisors. “Understanding these unique values and preferences is vital for manufacturers and retailers to win with these consumer segments.”
When it comes to the food shoppers are putting in their carts, Acosta found that multicultural shopper’s typical grocery cart includes a larger percentage of organic items compared with the total population of US shoppers. In the shopper survey, multicultural consumers were more likely to agree they buy natural/organic products because they know they are better for them.
“Multicultural shoppers recognize the link between food and their health and are significantly more likely to buy natural and organic foods even though they are often more expensive,” Clevenger said.
In addition to health, another attribute multicultural shoppers keep in mind when grocery shopping is authenticity. More than 40% of multicultural shoppers said they buy grocery brands that are authentic to their heritage, compared with just 26% of white/Caucasian shoppers.
To find the right products, multicultural shoppers are more likely to visit a greater number of store types for their grocery shopping needs. US Hispanic consumers are much more likely to visit a Hispanic/ethnic grocery store, while more Asian Americans reported grocery trips to warehouse or club stores compared to total US shoppers.
Another key area where multicultural consumers are breaking away from the total US shopper population is with their early adoption of digital technologies. Multicultural shoppers are comfortable with digital, with US Hispanic shoppers much more likely to read a digital flyer/circular, and Asian American shoppers to use a shopping list on their mobile device or use a product coupon on their mobile phone at checkout.
To connect with the growing group of tech-savvy shoppers, retailers and brands must bolster their overall digital presence and consider mobile apps and social media, according to Acosta.
Failing to keep up with the preferences of multicultural shoppers — from offering digital tools to stocking health-focused products — will cause retailers and brands to get left behind in the years to come. The population growth of multicultural shoppers is spread across the US, not just limited to select markets, so stores and manufacturers must find ways to connect with these consumers in order to succeed.
For more information about how multicultural consumers are shaping the future of grocery retail and insights from Acosta about how to adapt, download the Multicultural The Why? The Behind The Buy report.
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