As the largest minority population in the U.S., Hispanics have the buying power to positively impact the futures of brands and retailers, according to a new Cotton Incorporated Supply Chain Insights report.
Hispanics currently spend an additional $370 annually on apparel and services compared to non-Hispanic demographics and are projected to total 31 percent of the U.S. population by 2060, noted the report, “Securing the Hispanic Consumer.”
If brands and retailers are still considering whether or not to target this burgeoning market segment, they should consider Hispanic apparel and services spending is estimated at more than $30 billion, according to the Bureau of Labor Statistics.
“Winning the loyalty of Hispanic consumers could secure a confident future for brands and retailers willing to tailor their services to meet the demands of this growing demographic,” the study said.
Hispanic consumers have distinguished themselves as a special customer segment in part through their tendency toward being fashion-forward, said the study. The group is more likely (43 percent vs. 34 percent) than non-Hispanics to adopt new fashions earlier, as well as buy these fashions at the beginning of the season (27 percent vs. 19 percent).
“This fashion-forwardness can be critical for brands and retailers as they are eager to move merchandise off the shelves to make room for new, full-cost apparel,” the report said.
Hispanics spend an average of 22 minutes more shopping in-store, which the study said was “an opportunity for brands and retailers to take advantage of a captive audience and the additional time and money they could potentially contribute to a store’s bottom line.”
In addition, Hispanics are more likely to be motivated by fashion magazines, TV shows, commercials and celebrities, the study noted, so target marketing through these channels could be effective in stimulating apparel purchases.
Hispanic shoppers are also more likely to view shopping as a fun, social activity — 67 percent to 54 percent — than non-Hispanics, and are more likely to say they “love or enjoy shopping,” which could be another contributing factor to why they spend more time in-store (63 percent vs. 51 percent). Creating social spaces where customers can linger could also generate longer shopping times and potentially translates into more sales and a more loyal customer base.
Another way to encourage loyalty among this burgeoning consumer segment is to provide increased apparel product education, as Hispanics are 40 percent more likely to be loyal to brands that give them insight into fiber content and garment care. The study found that 72 percent of Hispanics surveyed considered cotton a favorite fiber.
As performance features become more popular and the ath-leisure trend continues to gain traction, the research showed that Hispanic consumers participate in high-intensity workouts and are more likely than non-Hispanics to participate in dance or Zumba and running or jogging. Many of these and other high-intensity activities demand performance features as well as custom apparel, outfits and accessories. This could explain why Hispanics are 50 percent more likely to buy a new outfit when taking up a new athletic activity.
“Brands and retailers can capitalize on athletic trends while also taking advantage of the fact that Hispanic customers are willing to pay a premium for the perfect athletic outfit ($87),” the study added. “This is a 37 percent spending increase over non-Hispanic demographics…Performance features Hispanics are willing to splurge on include cotton products that prevent odor, regulate temperature, shape and smooth, and don’t show sweat. Providing these fabric innovations in cotton will help brands and retailers secure the spending power of this growing demographic.”