According to IRI, Hispanics represent 12% of total OTC sales today. But that doesn’t tell the whole story. When you dig down to the OTC category and brand level, Hispanic growth is outpacing that of non-Hispanics. In fact, brands returning to the market are seeing Hispanic growth outpacing non-Hispanic by at least 20%.
That’s why our partners at the Consumer Healthcare Products Association (CHPA) asked us to develop a webinar with IRI Worldwide for their event series all about this game-changing consumer. We joined IRI’s Kathy Kemmet for Total Market Strategy: Your Roadmap to Winning with Hispanic Consumers last week, and here’s an overview of the Roadmap we covered:
Strategy. To realize this opportunity, OTC companies must make Hispanic an imperative at all levels of the organization, including the C-suite. It must also be integrated across the business planning process from Product R&D, to Market Research and Analysis, to Marketing (the four Ps), to Tracking & Measuring. Finally, companies should resource appropriately from both an employee and a financial perspective. Your marketing budget should be reflective of Hispanic contribution to your sales volume.
Research and Analysis. “In a Total Market Strategy organization, research and analysis must be inclusive of all customers,” shared Kemmet. That means that all the tools in your OTC toolkit – Point of Sale data, shopper panels, consumer psychographics, U.S. Census analyses, etc. – should include the Hispanic perspective. Here’s one example. Hispanics currently make up 11% of sales for the Cold/Allergy/Sinus category. If the category was able to increase that to 18% — fair share according to the U.S. Census – it would stand to gain $426 million. “This is pretty sizable. And let’s face it, cold/allergy/sinus problems aren’t going away,” added Kemmet.
Execute. The beauty of market research is that we know Hispanics have a similar buying behavior in 75% of health and beauty categories. In the execution phase is where you can embrace those similarities and celebrate the differences between segments to your advantage. In the pharma space, Flomax celebrated differences by understanding that the Hispanic consumer was at a different developmental stage. Their English-language campaign talked to a consumer already educated about BPH, while they knew they had to get back to the basics by making Hispanics aware of BPH symptoms in the Spanish-language version. They chose an original creative path, but OTC marketers can also consider adaptations and shadow shoots depending on how aligned their consumers are. A total market commercial plays nearly identical in English and Spanish. See McDonald’s First Customer here.
Track and Measure. When you hold leaders accountable for delivering results against a consumer group you begin to see positive momentum. A shared scorecard with key metrics on the campaign and segment level is important. It is this micro understanding of performance that will enable refinements to be made to maximize long-term success. As Kathy said, “When it’s done right, you will see a positive ROI.”