by Diana Leza Sheehan / founder, principal consultant, PDG Insights
In this new series, we explore the opportunity created for retailers by targeting Latino grocery consumers across the United States. In this article, we focus on the Southeast.
For context, the Latino population in 2024 reached about 66 million, or about 19.5 percent of the total U.S. population. Spending power among this diverse demographic group has reached more than $3.7 trillion. Annualized income growth among Latinos has outpaced non-Latinos significantly – 4.8 percent compared to 1.8 percent.
This series will highlight the size and opportunity for retailers, unique consumer trends and success stories across each of The Shelby Report’s five regions.
In this article, we explore the retail ecosystem in the Southeast. While national players own strong shares throughout the region, independents continue to find ways to customize offers and experiences tailored to Latino populations of varying countries of origin throughout the region.
Because the Latino consumer is the focus of this article, we have also chosen to include Puerto Rico in the Southeast analysis. The island territory is a unique but critical geography that has shaped the broader Latino population in the U.S.
Understanding diversity of region’s Latino consumer
The Southeast region encompasses 11 states and the territory of Puerto Rico and accounts for 26 percent of the U.S. population – 85.7 million people. One in five Southeast region consumers – nearly 13.5 million Latino residents – identify as Latino when Puerto Rico is included, and their population growth rate outpaces Latinos in any other regions.
U.S. census data helps us further understand the nuance of Latinos in this region. For retailers and manufacturers looking to prioritize Latino markets, Florida has the largest and most diverse population in the region, with 5.7 million consumers.
While 28 percent of the Latino population in Florida is Cuban, 20 percent is Puerto Rican and 18 percent hail from countries throughout South America. In addition, 13 percent identify as Mexican and remaining Latino consumers report country of origin in Central America and the Dominican Republic.
Puerto Rico serves as the next largest market in the Southeast, with 3.2 million Latino consumers, and accounting for one-fourth of Latino consumers in the region.
Georgia, particularly around the Atlanta metro area, and North Carolina also have large populations of more than one million Latino residents.
Virginia has seen steady and significant growth, rising to more than 865,000 Latinos, with many settling around Alexandria, Arlington and Virginia Beach.
Unlike Florida, other Southeast states see the majority of Latino consumers identifying as Mexican.
[RELATED: Unlocking The Midwest: Retail Strategies For Engaging Latino Consumers]
Local independents drive differentiation
National players like Walmart and Kroger hold significant market share in the Southeast, and discounters like Aldi and Dollar General continue to gain ground. As a regional player, Publix also targets Latino consumers.
However, to reach the Latino market, these mainstream retailers can learn from successful local players, customizing their offerings to meet the needs of Latino consumers.
In Puerto Rico, Supermax, Pueblo and Econo are the largest grocers on the island, with a focus on local products but integrating national brands as well. They are community focused and have tailored their approaches to local residents.
In Florida, family-owned retailers such as Sedano’s and Presidente each have dozens of stores throughout the state. They have established loyal Latino consumers bases with strong produce and meat departments, as well as by offering a variety of imported products from throughout Central and South America and the Caribbean where possible.
Bravo Supermarkets, an owner/operator group of stores that works through the Krasdale Foods grocery distributor, also is known for catering its assortment to appeal to Latinos, adjusting assortment to accommodate different countries of origin and featuring authentic foodservice.
What shoppers want: Exploring consumer themes
In looking at key consumer trends among Latino consumers, we see many similarities to the average consumer. Value remains a critical component in decision making – both for the brands purchased and the retailers chosen.
Natural and organic products continue to be a growth driver across segments and the role of technology throughout the shopping journey evolves as new technologies change how retailers and brands engage with consumers.
There are some attitudes and perceptions that stand out. According to a study conducted in December by PDG Insights, Latino consumers are much more likely to choose a retailer if they have unique or specialty items that represent their culture or ethnicity – 26 percent versus 16 percent of general population.
In the Southeast, we also see Latino consumers are more likely (38 percent versus 30 percent) to choose a retailer for in-store services, including bakery, deli and prepared foods.
Nationally, Latino consumers are much more likely to say they will spend more for a product that reflects their values.
In the Southeast, consumers are more likely than to favor products that align with their values regardless of ethnicity, which creates an opportunity for purpose-driven brands.
Southeast consumers also are more likely to define value as something that is more than just price. Latino consumers top their non-Hispanic counterparts (64 percent versus 58 percent) on this evolved value definition.
The role of technology also is a bit differentiating for Latino consumers when it comes to grocery shopping and meal planning. Nationally, more than half (54 percent) say they plan meals for the week.
When looking at those in the Southeast, that number increases to 58 percent of Latino consumers who engage in meal planning.
In addition, we see that 85 percent of Latino consumers in the Southeast engage with their retailers’ mobile apps, using it most often to check for deals and discounts, browse products and place orders for delivery or pickup.
Latino consumers also are more likely to interact with their retailers’ apps using new tech features such as augmented reality to navigate the store and find digital coupons.
In addition, they more likely than their general population counterparts to use artificial intelligence as part of the grocery shopping journey (33 percent versus 22 percent).
Three-fourths of Latino consumers that use AI in the Southeast say they use the tools or apps at least weekly for grocery shopping and meal planning. They use them for meal recommendations, automated shopping lists and finding deals and discounts.
PDG Insights also explored how consumers are viewing their broader circumstances, digging into areas beyond grocery shopping.
In the Southeast, Latinos are slightly less likely to think positively about their household financial health, with 59 percent stating they are in good or excellent financial shape compared to 63 percent of the general population. However, overall cost of living, healthcare costs and inflation remain top of mind for all consumers.
Blend of tradition, innovation
The Latino grocery market in the Southeast presents a clear opportunity for brands and retailers, driven by a diverse and growing population. Retailers who understand and cater to the cultural nuances and preferences of Latino consumers can tap into a significant and expanding market.
By offering authentic products, personalized services and leveraging technology to enhance the shopping experience, both national and local players can build strong, loyal customer bases. As the Latino population continues to grow and evolve, staying attuned to their needs and preferences will be key to sustained success in this complex market.
Diana Leza Sheehan, CEO of Evanston, Illinois-based PDG Insights, helps emerging brands and retailers make more effective strategic decisions. By leveraging data, she shares cost-effective consumer insights to plan retail sales narratives and brand strategies. Her 25-plus year career in the industry across sales, insight and strategy provides a unique perspective for clients.