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.
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 – 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 grocery ecosystem in the West. While national players own strong shares in some areas of the area, regional chains and independents continue to find ways to customize offers and experiences tailored to Latino populations of varying countries of origin throughout the region.
Latino-led region
With nearly 71 million residents, according to the U.S. Census Bureau, the West accounts for 21 percent of the nation’s population. While its most populated state, California, has seen a minor population decline, it still accounts for 56 percent of the region’s total – more than 39 million people.
Within the region, the Latinos are a driving force. For context, they accounted for some 21 million residents – 30 percent of the West’s population – and one-third of the Latino population in the U.S.
Seventy-three percent of those residents live in California, while Arizona, Washington and Nevada also have significant Latino populations concentrated around urban areas or rural agricultural centers.
In Arizona, more than 40 percent of the metro populations in Tucson and Phoenix is Latino. One-third of Las Vegas’ population identifies as Latino.
Power, potential of Latino grocers
Several strong regional and independent retailers have targeted Latino consumers in the West. They have carved out significant market shares by offering products and services that resonate with Latino communities.
A couple of examples are Cardenas Markets, which operates stores in California, Arizona and Nevada, and Los Altos Ranch Markets in Arizona. Owned by Heritage Grocers Group, these banners have become a preferred destination for many Latino consumers.
The retailer leans into its wide variety of fresh produce, authentic and intentional product assortment and specialty items that often are hard to find in mainstream grocery stores.
Another key player is Northgate Gonzalez Markets, which operates primarily in Southern California.
Like other stores focused on the Latino community, Northgate has built loyalty among its consumers through strong produce, bakery and meat departments offering authentic assortments. It emphasizes community engagement and cultural celebration, with stores often hosting events and promotions that align with Latino traditions and holidays.
With locations throughout California, Vallarta Supermarkets is another prominent retailer targeting Latino consumers in the region. El Super, owned by Chedraui USA, is a subsidiary of Mexico’s third-largest retailer. A sister banner to Fiesta Mart in Texas, El Super operates more than 70 stores throughout the West.
These retailers have shown that understanding and addressing the specific needs and preferences of Latino consumers can lead to significant business success. By offering culturally relevant products, creating welcoming store environments and engaging with the community, they have built strong connections with their customers and established themselves as leaders in the Hispanic grocery market.
More importantly, we see that the approach to retailing appeals to both Latino and non-Latino consumers. In a December article by P2PI, Placer.ai shared that Latino grocery chains show higher visitation rates than other retailers in the category, and non-Latino consumers are shopping in the channel more often.
[RELATED: Harnessing Power Of Latino Market In Southwest]
Exploring critical consumer themes
In looking at key consumer trends among Latino consumers, we see similarities to the average shopper. Value is still a critical part in decision-making – both for the brands bought and retailers chosen.
Natural and organic products continue to be a growth driver across segments, and the role of technology throughout the shopper 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 2024 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).
In the West, we see Latino consumers are more likely than their general population counterparts to choose a retailer because it has friendly and helpful staff (36 percent versus 27 percent), strong private label (20 percent versus 15 percent) and a good loyalty or rewards program (28 percent versus 23 percent).
Nationally, Latino consumers are more likely to say they will spend more for a product that reflects their values. And we see consistent attitudes among Latinos in the region (58 percent versus 54 percent), which creates an opportunity for purpose-driven brands.
Compared to their counterparts, they are much more likely to create shopping lists (75 percent versus 55 percent), so reaching them before they visit the store is important. More than half (54 percent) of Latino consumers nationally say that they plan meals for the week.
Technology can play a differentiating role in reaching these shoppers. We see that 83 percent of Latinos in the region engage with their retailers’ mobile apps, using them most often to check for deals and discounts, browse products, clip digital coupons and place orders for delivery or pickup.
Within their retailers’ apps, they also are more likely to engage with new tech features such as augmented reality to find digital coupons in-aisle and compare prices.
In addition, one in four Latino consumers in the West uses artificial intelligence as part of the grocery shopping journey. Half of Latino consumers that use AI in the region say they do so at least weekly for grocery shopping and meal planning, and they are using these tools for meal recommendations, voice-activated shopping and to find deals and discounts.
PDG Insights also explored how consumers view their broader circumstances, digging into areas beyond grocery shopping.
Compared to those in other regions, Latinos in the West are less positive about their financial health. Just 52 percent state they are in good or excellent financial shape, while the average across other regions is 58 percent. However, the overall cost of living, healthcare costs and inflation remain top-of-mind for all consumers.
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.