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P&G targeting Latino shoppers

September 15, 2011

A WSJ report says the company will tweak its products to appeal to the Hispanic market.

Procter & Gamble is accelerating its efforts to win over Hispanic shoppers, The Wall Street Journal reports. WSJ's Ellen Bryson says based on its research, P&G is tweaking products, retargeting its marketing, changing its mix of celebrity spokeswomen and making greater use of Spanish on its products.

Hispanics accounted for more than half of the gains in the U.S. population from 2000 to 2010, according to the U.S. Census Bureau, and their younger, bigger families are a good fit for the maker of Pampers diapers and Tide detergent.

"You've got to consistently shift your business model to target where the growth is," says Melanie Healey, P&G's group president of North America.

Bryson emphasizes that more American shoppers remain reluctant to spend, hampering sales growth for P&G's brands and the overall household-products industry. Sales in emerging markets, where P&G is aggressively expanding, are growing briskly, but it still depends on the U.S. to deliver the biggest share of its sales and profit.

According to market-research firm Packaged Facts, sales in the U.S. Hispanic population, however, are showing better growth. In the past decade, the demographic's spending on laundry, household-cleaning supplies and personal-care products grew nearly three times faster than non-Hispanics' outlays.

Hispanic households tend to spend more on cleaning and beauty products and are more loyal to the brands they like than the average U.S. consumer, industry analysts say. P&G's researchers have found that while generally frugal spenders, Hispanics are also willing to splurge on the types of premium household goods that P&G makes, subscribing to the phrase "lo barato sale caro," meaning that cheap things may ultimately prove costly.

"She's not necessarily going for the least expensive option all the time, because that can be more expensive in the long run," Alexandra Vegas, P&G's multicultural marketing director, says of the Hispanic consumer.

Hispanics spent about $1 trillion last year, accounting for some 9% of total consumer buying power in the U.S., and are expected to shell out $1.5 billion by 2015, outpacing growth in spending by non-Hispanic consumers, according to estimates by the University of Georgia's Selig Center for Economic Growth.

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