His­panic shop­ping pull­back per­ceived

Northwest Arkansas Democrat-Gazette - - BUSINESS & FARM - BLOOMBERG NEWS MATT TOWNSEND AND SPENCER SOPER

Tar­get Corp. Chief Ex­ec­u­tive Of­fi­cer Brian Cor­nell is sound­ing alarm bells over the state of His­panic shop­pers in the U.S. — a key growth de­mo­graphic for many re­tail­ers and con­sumer brands.

“The His­panic con­sumer in the U.S. is shop­ping much less,” Cor­nell said at the For­tune Brain­storm Tech event last week in Aspen, Colo. “They are staying home. They are go­ing out less of­ten.”

Cor­nell didn’t men­tion Pres­i­dent Don­ald Trump by name, but he talked about a shift in be­hav­ior this year and men­tioned “bor­der towns” — where re­tail­ers for years have de­pended on shop­pers from north­ern Mex­ico for higher rev­enue. Trump took of­fice in Jan­uary af­ter promis­ing to crack down on un­doc­u­mented im­mi­gra­tion, es­pe­cially from Mex­ico. Pur­chases by His­pan­ics at U.S. re­tail­ers in cat­e­gories tracked by re­searcher NPD Group have fallen 8 per­cent this year.

“There’s clearly been a pull­back” since Trump was elected, said Mar­shal Co­hen, an an­a­lyst at NPD. “There’s con­cern about go­ing out in an en­vi­ron­ment where you could be de­ported.”

As the num­ber of U.S. His­pan­ics has grown over the past decade, the group’s spend­ing power has in­creased and made it an in-de­mand de­mo­graphic. Two years ago, Tar­get be­gan a cam­paign geared at His­pan­ics called Sin Tra­duc­cion — with­out translation — that fea­tured words with no English equiv­a­lent.

Other re­tail­ers such as J.C. Pen­ney Co., restau­rant chains such as McDon­ald’s Corp., and con­sumer brands as di­verse as Yo­plait, Her­shey and John­nie Walker are all court­ing a group that now makes up about 20 per­cent of the pop­u­la­tion.

Ap­parel and ac­ces­sories have also been hurt, ac­cord­ing to NPD data through March. Food and small ap­pli­ances, though, haven’t been af­fected, Co­hen said. The de­cline in pur­chases among His­pan­ics comes as U.S. con­sumer spend­ing over­all has in­creased amid ris­ing con­fi­dence, low un­em­ploy­ment and wage gains.

Sneakers are tak­ing a hit with pur­chases by His­pan­ics de­clin­ing at a high-teen per­cent­age this year, ac­cord­ing to Matt Pow­ell, also an an­a­lyst at NPD. He said that’s af­ter growth last year in the mid-teens range. The brands see­ing the big­gest im­pact are VF Corp.’s Vans, Nike, Skech­ers and Nike’s Jor­dan brand, ac­cord­ing to NPD.

Pow­ell called the drop un­prece­dented.

“I’ve never seen any­thing like it,” he said. “It’s re­ally there and ma­te­rial.”

In­for­ma­tion for this ar­ti­cle was con­trib­uted by Craig Gi­ammona, Les­lie Pat­ton, Jen­nifer Ka­plan and Matthew Boyle of Bloomberg News.

Newspapers in English

Newspapers from USA

© PressReader. All rights reserved.