Study reveals how QSRs can build loyalty among Hispanic consumers

April 6, 2012

Univision Communications Inc., a media company serving Hispanic Americans, released its Univision QSR Landscape study exploring how quick-service restaurants can expand their businesses by better addressing the needs and wants of the Hispanic community.

The findings of the study, conducted in partnership with Burke Inc., were discussed during the "Hispanic 411: Insights to Grow Your Business" webinar earlier this week.

"Last year, NPD's new CREST Hispanic tool confirmed that Hispanic consumers are driving QSR growth, contributing 17 percent of all restaurant traffic and 18 percent of all restaurant dollars in 2011," said Michele Kessler, senior vice president of Univision's Client Development Group. "Univision's QSR Landscape study will help brands take advantage of the opportunity by understanding what motivates Hispanic consumers to visit, return and become loyal customers."

During the webinar, Kessler and Peter Filiaci, vice president of Univision's Client Development Group, discussed the survey's key findings, including:

  • Hispanic consumers are frequent visitors to QSRs. Hispanics, including millennials, are much more likely than the general population to visit QSRs. The study found that on average, Hispanics visit QSRs more than 10 times in a 30-day period, while non-Hispanics visit about seven times per month. Furthermore, Hispanics are nearly twice as likely to be categorized as frequent users (more than 10 visits a month) than are non-Hispanics and significantly contribute to the breakfast (20 percent Hispanic vs. 14 percent of non-Hispanic) and snack (21 percent Hispanic vs. 12 percent non-Hispanic) dayparts. Latino millennials visit QSRs even more frequently – 12 times a month versus eight times per month than non-Hispanics.
  • Hispanic party size is bigger. The Univision QSR Landscape study found that Hispanics are more likely to visit with friends and family than the general population – 34 percent of Hispanics are likely to bring children 18 years of age or younger versus 25 percent of non-Hispanics; and 25 percent are likely to bring friends compared to 18 percent of non-Hispanics. Hispanic millennials are also 10 percent more likely to bring friends (36 percent vs. 26 percent non-Hispanic). Across all meal times, this adds up to Hispanics having on average 2.9 people in their party vs. 2.1 for the general population.
  • Hispanics showcase profitable ordering patterns. Hispanics are much more likely to order beverages with their meals; 93 percent say they order food and a beverage when they visit a QSR vs. only 78 percent of non-Hispanics saying they order both. Hispanics are also less likely to use a coupon (25 percent vs. 30 percent non-Hispanic).
  • A family-friendly environment is a major driver. Whether it's for new or returning customers, Hispanics look for QSRs that can accommodate their bigger parties and social needs. Hispanics are much more likely to cite spending time with family (44 percent vs. 20 percent non-Hispanic), treating the children (30 percent vs. 16 percent non-Hispanic) and spending time with friends (21 percent vs. 10 percent) as reasons to visit a QSR. The story is similar for Hispanic millennials; two out of the top five reasons to visit are tied to family. Family did not rank in the top five reasons to visit for non-Hispanic millennials.
  • Hispanics are drawn to fresh food options. Fresh food also plays a major role in getting Hispanics to visit and return to a QSR. "Having fresh food on the menu," "having healthy meal options for children," and "offering fresh veggies and salads" are some of the most commonly chosen reasons to try a new restaurant. For non-Hispanics, that list is dominated by value options like "getting more food here for the same price at other places" or receiving a discount or coupon in the mail.
  • Opportunities abound to build relationships with Hispanics. Overall, unaided awareness levels for QSR brands are generally lower among Hispanics. The burger category dominates QSRs when it comes to top of mind recall and overall unaided awareness. Hispanics also hold more favorable opinions of brands across categories with 65 percent having extremely favorable or very favorable opinions of burger brands (vs. 50 percent non-Hispanic), 50 percent for pizza brands (vs. 38 percent non-Hispanic) and 58 percent for sub/sandwich brands (vs. 54 percent non-Hispanic). And, once a brand establishes a relationship with Hispanic consumers they become even more loyal customers than non-Hispanics.

"We believe that more targeted communication to Hispanics would help raise awareness levels and motivate Hispanics to make a decision among the plethora of fast food options available to them," Kessler said. "Restaurant ad spending on Spanish-language TV has grown 31 percent from 2006 to 2011 as brands realize that Hispanic consumers are essential to their growth, yet many brands are inactive or spending way below the recommended 15 percent of total media dollars."

The study, fielded by Burke Inc., consists of interviews of 1,250 U.S. and foreign-born Hispanics, and 1,250 non-Hispanic adults who are frequent patrons of QSRs. Twelve QSR chains were used in the study. The survey was conducted in both English and Spanish.

Similar to other studies

Results from the study echo similar reports released recently about how the growth of the Hispanic demographic will benefit the restaurant industry. The U.S. Census indicates that the Hispanic population is expected to grow 34 percent from 2010 to 2020. Foodservice market research company NPD Group has found that this growth is beginning to influence national consumption patterns.

QSRs have begun responding to the trend by directing more marketing dollars toward the Hispanic demographic. According to the Association of Hispanic Advertising Agencies (AHAA), there has been a 14 percent increase in budget allocation for these types of campaigns since 2009.

The QSR segment falls into the "Leaders" category of the AHAA's list of Hispanic advertisers, with a significant increase of 30 percent, or $70 million in incremental investment, for $301 million total spend in 2010.

Brands such as Popeyes', Domino's, Pizza Patron, Wendy's, Burger King, Dunkin' Donuts, Baskin-Robbins, El Pollo Loco, Whataburger, Sonic, Carl's Jr. and Hardee's have increased their Hispanic marketing budgets, hired agencies specifically to communicate to the Hispanic demographic or added staff for the same reason.

In 2011, McDonald's was listed as the fourth top spender in Hispanic media, among all advertisers in all industries.

Read more about trends and statistics.

Topics: Business Strategy and Profitability , Marketing / Branding / Promotion , Operations Management , Trends / Statistics

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