Expanding a Major Food Company’s Innovation Pipeline via Hispanic Consumer Research

Background

A major foods company, known for producing a wide range of canned food products, sought to expand its market reach by targeting Hispanic consumers, particularly Mexican-Americans in the United States. The company planned to introduce two new products: Flavored Product X and a Meatless Product Y. These products were designed to compete against established brands, particularly the leading competitor brand, which held a strong position in the Hispanic food market. To ensure the success of these products, the company engaged CASA, a specialized consumer insights firm, to conduct comprehensive research aimed at understanding the preferences, behaviors, and cultural significance of Product X and Product Y among Hispanic consumers.

Research Objectives

The research aimed to address several key questions critical to the successful launch of the new products:

1. Brand Loyalty: Assess the loyalty of consumers to the leading competitor brand in the Product X and Product Y categories.
2. Product Interest: Determine the level of interest in the Meatless Product Y, which requires consumers to add their own protein.
3. Geographic Variations: Identify any geographic differences in product preferences and market opportunities, particularly between the East and West coasts.
4. Brand Naming: Evaluate which brand name, Brand A or Brand B, would resonate more with the target consumers.
5. Label Design: Assess consumer preferences for can label designs and how they could be improved to compete with the leading competitor brand.

Research Methodology

The research was conducted in three phases:

1. Quantitative Survey: A survey was developed and distributed to 743 Hispanic consumers, primarily Mexican-Americans, who were regular buyers of canned Product X and Product Y. This survey was conducted in both Spanish and English, ensuring a broad demographic reach and high response rates.
2. Qualitative Online Bulletin Board: A weeklong online discussion with 40 high-engagement consumers was conducted to gain deeper insights into purchasing habits, cultural connections, and reactions to the product concepts.
3. Virtual Focus Groups: Follow-up discussions with 20 consumers provided further qualitative feedback, focusing on clarifying and expanding on insights from the previous phases.

Key Findings

1. Brand Loyalty and Cultural Significance:

The research revealed that the leading competitor brand is deeply embedded in the cultural and familial practices of many Hispanic households. Product Y, in particular, holds significant cultural value, often associated with family gatherings and traditions. Consumers expressed a strong loyalty to the leading competitor brand, driven by its perceived authenticity, taste consistency, and quality. However, this loyalty was not insurmountable, as consumers indicated a willingness to try new products if they matched or exceeded the leading competitor brand’s quality and taste.

2. Interest in Meatless Product Y:

There was a notable interest in the Meatless Product Y concept, especially among younger, health-conscious consumers. These individuals appreciated the flexibility of the product, allowing them to avoid tripe, which many found unappealing, and to incorporate their preferred protein. The product was also seen as a convenient and culturally appropriate option for family meals and religious occasions, such as Lent. However, the success of the Meatless Product Y would hinge on its ability to replicate the traditional taste and texture of Product Y while clearly communicating its health benefits.

3. Geographic Insights:

The research uncovered regional variations in consumer preferences. While there was interest in both coasts, the East Coast showed a slightly higher openness to trying new products, particularly among second and third-generation Hispanics. These consumers were more likely to explore new flavors and healthier options, aligning with broader trends in health and wellness.

4. Brand Naming and Label Design:

Consumers showed a strong preference for the brand name “Brand A” over “Brand B.” “Brand A” was perceived as more authentic and culturally resonant, evoking the image of a traditional Hispanic woman’s homemade recipe. In contrast, “Brand B” lacked the personal and emotional connection necessary to compete effectively in this market segment.

Regarding label design, consumers favored labels that conveyed authenticity and cultural heritage. They preferred simple, yet culturally significant designs that incorporated Mexican colors and symbols. Labels that depicted fresh ingredients and used Spanish as the leading language were particularly appealing. However, the term “starter” on the Meatless Product Y label was confusing to many consumers, who associated it with a base product rather than a ready-to-eat option. This confusion, coupled with inaccuracies in the Spanish translation, led to a lack of trust in the product’s authenticity.

Impact of the Research on the Company

The research provided the major foods company with critical insights into the Hispanic consumer market, enabling the company to make informed decisions about its product development and marketing strategies. Key recommendations included:

• Enhancing Product Authenticity: The company was advised to ensure that the Meatless Product Y closely mimicked the traditional taste and texture of Product Y while clearly communicating its health benefits. The company was also encouraged to consider developing a Meatless Pozole, leveraging the popularity of Product X in Mexican cuisine.
• Refining Brand and Packaging: The preference for the “Brand A” name and the importance of culturally resonant packaging led the company to refine its branding strategy. The company was advised to simplify its label designs, incorporate traditional Mexican elements, and use accurate and appealing Spanish translations.
• Targeted Marketing: The research highlighted the importance of targeted marketing, particularly towards younger, health-conscious consumers on the East Coast. The company was encouraged to emphasize the health benefits of its Meatless Product Y in its marketing campaigns and to explore opportunities for product sampling in Hispanic supermarkets.

Conclusion

The comprehensive research conducted by CASA provided the major foods company with invaluable insights into the Hispanic consumer market, particularly within the Mexican-American community. By understanding the deep cultural connections to products like Product X and Product Y, the company was able to tailor its product offerings and marketing strategies to better meet the needs and preferences of this important consumer segment. As a result, the company is well-positioned to successfully launch its new products, fostering brand loyalty and expanding its presence in the Hispanic food market.