While Hispanic flavors and foods may have mainstream appeal, the Hispanic demographic is powerful and growing. The group is the largest minority in the U.S. and is expected to account for 24% of the country by 2050. Present-day Hispanics hold a sizable degree of purchasing power (see sidebar “La Energia”), estimated at $700 billion by Hispanic Business magazine (Santa Barbara, Calif.). As such, it may be surprising to some that many categories have yet to tap the potential of this group.

Jim Corcoran, vice president of the National Confectioners Association (Vienna, Va.), believes, “There is no bigger opportunity for confectionery manufacturers today (than the Hispanic population),” and certain manufacturers are responding. While Atkinson Candy Co. (Lufkin, Texas) and Pop Rocks Inc. (Falls Church, Va.) have made tentative moves into Hispanic candies, Hershey Foods Corp. (Hershey, Pa.) has introduced a line of sweets targeting the demographic. "With over 40 million Hispanics influencing all areas of American culture--from food to music to fashion--and with purchasing power of $630 billion, the U.S. Hispanic market represents a tremendous growth opportunity," explains Thomas K. Hernquist, senior vice president and chief marketing officer with Hershey.

To appeal to the group, aside from a multi-year marketing agreement with Latina entertainer Thalía Sodi, Hershey has developed a line of products tailored to Hispanic tastes. Expanding its Jolly Rancher line, La Dulceria Thalia features Frutas Enchiladas Spicy Fruit & Chili Lollipops in three flavors: lime, mango and tamarind. La Dulceria Thalia Hershey's Kisses are made with white chocolate and filled with dulce de leche, while the Cajeta Elegancita Candy Bar consists of wafer sticks layered with cajeta-flavored creme and drizzled with milk chocolate.

C What I Mean

The emerging Hispanic influence also is being felt in c-stores, and new products are taking the authenticity seriously. For Lettieri's Inc.'s (Shakopee, Minn.) line of Buenos Amigos empanadas, “We had food experts take a look at it and try to mimic some of the authentic recipes out there currently,” explains David Poplau, the company's director of marketing and sales support. “We did a focus group this past summer, which was a half-dozen panels of c-store customers, and it is amazing how sophisticated that customer is. They are demanding that authenticity, rather than a quasi-Mexican type food.”

Such adventurous gringos are the primary target for Nueva Cocina Foods Inc. (Miami), though the company hopes to attract second- and third-generation Hispanics as well, assures company president Celeste De Armas. “In many ways, Latin food is where Italian foods were 30 years ago,” she believes, “where everybody knew Italian: spaghetti, lasagna and pizza. It was almost a staple, but the last 30 years has seen a jump from just the basics to the richness of the cuisine and all the variety. With Latin cuisine, we are at the tip of development or maturation of the cuisine in the U.S. and getting much more sophisticated. It will take a little time, but it will be there.”

Cindy Ayers, vice president with Campbell's Kitchen (Campbell Soup Co., Camden, N.J.) shares a similar forecast. “As a basic cuisine becomes more popular in more mainstream venues, chefs at higher-end foodservice operations begin to 'deconstruct' that cuisine, looking for ways to leverage the growing interest of their patrons, while retaining their own uniqueness and creativity. For example, once salsa and tacos and enchiladas were firmly ensconced on America's tables, high-end chefs were using ingredients like chipotle chilies and huitlacoche mushrooms, and menuing dishes from Oaxaca and Veracruz…but it does take time for these very authentic foods and ingredients to move from restaurant menus to supermarket shelves.”

Keep It Real

Whether due to increased travel or more-adventuresome palates, consumers are looking for an authentically ethnic food experience and realize that foreign cuisines are far from homogenous. Chinese food suffices no longer; now, the consumer wants Cantonese, Hunan or Szechwan varieties and, instead of Americanized Italian, the consumer is seeking Sardinian, Ligurian, Bolognese or Tuscan cuisines, which have prompted several recent introductions.

Companies also would be well-advised to draw inspiration from elsewhere in the region, considering the health benefits of the Mediterranean diet. Various studies have boasted of the cuisine's ability to help lower the risk of heart disease and cancer, decrease cholesterol and increase life expectancy. The foods of Greece and southern Italy have been of interest to researchers, as these locales have a particularly low incidence of chronic diseases and high life-expectancy rates.

The positive health benefits of the Mediterranean diet were not lost on Campbell Away From Home, the foodservice division of Campbell Soup, when looking to expand its award-winning V8 line of soups, chilis and entrées. Amy Galgon, associate marketing manager with Campbell Away From Home, recalls, “In developing the new soups, we leveraged the creativity of our culinary resources, which led us to explore beyond the expected Italian and French into Greek and other Mediterranean cuisines. The Greek Minestrone variety features ingredients consistent with those recommended in the Mediterranean diet--tomatoes, orzo pasta, red lentils and olive oil, and it fits very well into the nutritional profile of the V8 product line.”

Campbell is not the only company with Mediterranean inspiration for a foodservice foray. Fairfield Farm Kitchens (Brockton, Mass.) looked to Morocco for its Moroccan Stew Entrée, a mix of fresh sweet potatoes, cabbage and peppers simmered with tomatoes, raisins and chickpeas served with golden couscous.

The retail arena has seen some Mediterranean introductions, but few entire lines built completely around the cuisine as a whole. Red pepper hummus dip under the Sabra Go Mediterranean banner from Blue & White Foods (Astonia, N.Y.) joined the company's hummus line, and Grecian Delight Foods (Elk Grove Village, Ill.) is among the companies launching gyros as a convenient mealtime option.

For the most part, however, companies simply have added a Mediterranean variety to a line. Kraft's (Northfield, Ill.) range of South Beach Diet Frozen Dinners includes Mediterranean Style Chicken with Couscous, as did an entry from Destination Products' (Mississauga, Ont.) Homestyle Menu Low Carb Frozen Foods. One recent debut adds the flavor of the Mediterranean to pizza, as the Chef Antonio line from Richelieu Foods (Braintree, Mass.) combines such regional staples as roasted peppers, artichokes, roasted eggplant, black olives and basil for Mediterranean Style pizza.

Moroccan flavors can be found in Moroccan Lentil Rice Pilaf from Seeds of Change (Santa Fe, N.M.), and this division of Masterfoods USA (Hackettstown, N.J.) also added a New World flair to its Caribbean Style Rice & Black Beans, which blended black beans with “the warm spices of the islands.”

Caribbean Keen

Much like the Mediterranean offerings, Caribbean-flavored items appear mostly as a portion of larger lines rather than as a range themselves. For instance, Island Chicken in Caribbean Sauce with Rice appears under the Smithfield Flavore' Refrigerated Entrées line from RMH Foods (Morton, Ill.). A notable exception is the Matouk's range from National Canners (Sunrise, Fla.), which boasts four versions of Caribbean Jams (mango, pineapple & guava, guava and pineapple), plus Hot Calypso Sauce (blending West Indian scotch bonnet and habanero hot peppers) and Caribbean Chunky Salsa (made from West Indian garden herbs, spices, and hot and sweet peppers). On the dessert side, Tropical Treats from Caribbean Ice Cream (Toronto) include such flavors as lychee, saffron, grapenut, mango, date, fig and coconut for foodservice operators.

While there may not be a great number of Caribbean-themed foodservice establishments, one chain has done fairly well over its 10-year history. Bahama Breeze (Orlando, Fla.) registered sales of $176 million in 2004, a 28% improvement over the previous year, and the popularity of ethnic restaurant chains cannot go unnoticed.

Mintel (Chicago) research finds that large ethnic restaurant chains reported $4.3 billion in sales in 2003--compared with $2.5 billion as recently as 1998. The NPD Group Inc. (Port Washington, N.Y.) reports that 3.5% of fast-food meals purchased are Mexican, and 2.3% are Asian, nearly double their respective totals from 1989. The leader among Asian chain restaurants is P.F. Chang's (Scottsdale, Ariz.), offering largely authentic menu items like lo mein beef and kung pao chicken. While the fare may not be truly adventuresome, the chain has been successful, to the tune of $670 million in annual sales.

According to the NPD Group, ethnic foods are providing the impetus for the 6% growth in takeout traffic in 2004 at independent casual-dining restaurants. While pizza unsurprisingly occupied a spot in the top five, other items at the top included shellfish, pasta, Asian foods and Hispanic items, which are propelling interest in other cuisines.

“Argentine food is coming along with the other cuisines from South America,” Ayers finds. “In a similar vein, but with a Caribbean flair, the cuisine of Cuba still has room to grow, though it seems to be still happening in restaurants but not in most supermarkets. Also, from Europe, the authentic cuisine of Spain continues to make inroads on restaurant menus.”

The National Restaurant Association (Washington) reports Latino-themed restaurants are growing 3.5 times faster than any other group, and most mainstream restaurants are incorporating Latin fusions. The association notes the Hispanic population spends more than $55 billion annually on food and beverages. Furthermore, Crain's Chicago Business (Chicago) finds that Hispanic consumers, while not the only group demanding Latin flavors, still account for 10.5% of all expenditures for food at home--approximately $11.1 billion on meat, poultry and dairy; $4.5 billion on fruits and vegetables, and $1 billion on fats and oils. Meanwhile, the number of Hispanic-owned restaurants and drinking establishments more than doubled between 1987 and 1997, according to U.S. Census data published in 2001.

The important thing to remember is that the term Hispanic does not imply only Mexican or even Latin cuisine. Flavors from further south also are poised to occupy consumers' attention, due to the growing understanding and appreciation for the diversity of the area's influences.

“These cuisines are still some time away from most grocery shelves,” believes Ayers, “but the dishes most likely to be featured on menus are those related to barbecue. In Brazil, the churrasco is a celebration of grilled meats, including beef, pork, lamb and sausage. This kind of meal is also popular in Argentina (another emerging South American cuisine), and there it is called asado. Building on the recent Atkins frenzy, these 'high-protein' meals surged. The sauce chimichurri--a tangy, spicy herb sauce served in Argentina with asado--definitely is making waves on menus, and Brazil's caipirinha, a potent lime drink made with cachaça (a sugarcane liquor), similar to the Cuban mojito (made with rum), is all the rage.”

Sidebar: La Energía

Manufacturers likely are well aware of the buying power of the nation's Hispanic populace, but other traits of this diverse group should be considered as well.

Hispanic household income is growing--38% earned over $40,000 in 1999 versus 26% in 1994.

Seven states have more than 1 million Hispanics (Arizona, California, Florida, Illinois, New Jersey, New York and Texas).

The Latino population wielded $653 billion in spending power in 2003, a number expected to surpass $1 trillion by 2008, estimates the Selig Center for Economic Growth (University of Georgia, Athens, Ga.).

In the U.S., Hispanic purchasing power is growing at triple the rate of the overall U.S. population.

Hispanics contributed 23% ($65 billion) of the nation's total purchasing power of $284 billion in 2003, while only accounting for 13.8% of the total U.S. population.

Currently, the U.S. has more than 10 million Hispanic households. By 2010, that number will soar to 13.5 million, up from less than 6 million in 1990. These households will control $670 billion in personal income six years from now, with Mexican-American households accounting for $409 billion of this total. By 2010, the nearly 2 million households from Central and South America will earn $107 billion, with Puerto Rican households controlling $65 billion. Cuban families will account for $32 billion, the remaining $56 billion being earned by Spanish, Dominican and other Hispanic households.

Source: The Conference Board (New York)

Links

• Crain's Chicago Business
• Hispanic Business magazine
• National Restaurant Association
• National Confectioners Association
• The NPD Group