AHAA: CPGs, CPG-based retail companies that reach out to Hispanic market see higher revenue growth

Coca-Cola, Walmart named among key drivers

MCLEAN, Va. — Consumer packaged goods brands that dedicate a share of their overall marketing resources to the ever-growing Hispanic market prompted about one-third of their overall revenue growth, according to a study from the Association of Hispanic Advertising Agencies.

AHAA said it found a positive connection between corporate Hispanic marketing and revenue growth specific for CPGs and CPG-based retail companies after analyzing 35,000 U.S. advertisers and their allocation trends to Hispanic media between 2006 and 2010. Approximately 39 CPG companies and retailers were included in the final study, a subset of 211 public companies with consistently advertised in Hispanic media between 2006 and 2010, AHAA said.

The study identified seven companies as "best in class," driving the highest overall organic revenue growth from their consistent leading efforts in the Hispanic market, including Coca-Cola, General Mills, Ralcorp, Groupe Danone, Nestle, Walmart and Walgreens. Other companies analyzed include Clorox, Unilever, Kimberly-Clark, Target, Church & Dwight, CVS, Hormel, PepsiCo, Kellogg's, Diageo, Pernod Ricard, Sara Lee, Fortune Brands, Rubbermaid, NutriSystem, ConAgra, Campbell's, Hershey's, L'Oreal and Estee Lauder, among others.

The AHAA said effective growth leaders consistently put higher focus on creating solid relationships with the Hispanic consumer base, while CPG "underperformers" tend to overlook Hispanic growth opportunities, which typically resulted in sluggish growth, which leads to slower value creation to their shareholders.

"The connection is clear and very significant," said Cristina Garcia, professor of statistics at USC, who oversaw the methodology of the study. "The study found evidence that the proportion of resources a company, irrelevant of market category, puts behind Hispanic consumers is an essential driver for sustainable growth performance."

Added AHAA chairman and Acento Advertising CEO Roberto Orci, "This new information is compelling because the data indicates that the Hispanic market can be a big determinant in corporate success. CPG companies not only want to gain market share among their competitors but they also want to provide growth and stability for their investors — investing in Hispanic marketing is a clear strategy in achieving that two-fold objective."

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