Hispanic shoppers in U.S. staying home
Target CEO sounds alarm over sales drop
Target Corp. chief executive 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 Tuesday in Aspen, Colo. “They are staying home. They are going out less often.”
Cornell didn’t mention U.S. President Donald Trump by name, but he talked about a shift in behaviour 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 eight per cent 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 i ncreased and made it an indemand demographic. Two years ago, Target began a campaign geared at Hispanics called Sin Traduccion.
Other retailers like 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 per cent of the U.S. 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.
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.”
CONCERN ABOUT GOING OUT WHERE YOU COULD BE DEPORTED.