On a recent business trip from Alabama to Texas, I noticed as we drove closer to the Mexico border the big chain super stores were slowly changing. The products being sold were items that were not familiar to me. Many items were labeled in Spanish. There were items such as ponchos, sombreros, etc. This was fascinating to me. I felt like I was in another country even though I was still in the United States. Later that month, I was at a family function and had a conversation with my sister-in-law. We were talking about her job, and we started discussing how the retailers cater to ethnicity in their stores. This event led me to research how ethnicity in certain areas of the United States influences how retailers stock their shelves.
Clarifying ethnicity as a demographic concept can be a little tricky. The first thing I want to do is clarify the definition of ethnicity. According to Diffen, ethnicity refers to cultural factors including nationality, regional culture, ancestry, and language. It is the state of belonging to a social group that has a common national or cultural tradition (Ethnicity vs. Race, n.d.). Ethnicity is not based on how you look or what your race is. It is based on cultural traditions, heritage, language, and cuisine. Ethnic differences are something you learn. They are not inherited.
Some people have more than one ethnicity. Race and ethnicity can sometimes blend together. For example, a Hispanic-American would probably identify themselves as a member of the Hispanic race but if they do not participate with any of the customs of their ancestors, they will probably not associate with that culture or ethnicity. People often get race and ethnicity confused. They will refer to Italian, German, Irish, or Scottish as races when in fact they are ethnicities. Race is who you are genetically. There are largely five categorizations of race: American Indian or Alaska Native, Asian, Black or African American, Native Hawaiian or Other Pacific Islander, or White (Katzen, S., n.d.).
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Although ethnicity is different from race, it is interesting to note that race was a demographic concept back in the first census in 1790. It has evolved over the years with certain terms being added, removed, or replaced as time goes on. The term “Negro” was replaced with “African American” and “Oriental” was replaced with “Asian American”. As immigrants came to the United States, ethnic groups congregated and formed small communities. These communities were made up of street vendors, restaurants, and retail stores selling ethnic food, vegetables, clothing, jewelry, etc. An example is Chinatown that was formed in 1853. Many metropolitan areas have a “Little Italy”, “Chinatown”, Hispanic community, etc. As the immigrants dispersed into wider areas, there may be one or two ethnic stores in a small town. Today we see retailers use ethnicity to determine what to buy and sell in mainstream stores. For example, Walmart has a section of their store dedicated to international food.
First, we have specialized stores that are specific to a certain ethnicity. Winn-Dixie has a subsidiary, Fresco y Mas, that provides authentic ingredients to Hispanic communities. There are also supermarkets such as 99 Ranch Market for the Asian-American population. These are examples of companies recognizing the demand from consumers for ethnic products being offered either at their local stores or at a specialized store. It is interesting to note that as the income level is rising in Latin and Asian ethnic groups, so does their spending power. According to Loria (2017), new Nielsen research reveals that multicultural groups spend as much as 4% more in fresh grocery store departments than white non-Hispanics.
It is also interesting to note that non-ethnic shoppers are watching the Food Network and becoming interested in different foods, spices, and seasonings as a hobby. These customers increase business as they expand their tastes and become more involved in their hobby of cooking. Secondly, we need to look at the agricultural aspect. Farmers will need to stay attuned to the demand of ethnic groups so they can keep up with the demand of vegetables, flours, grains, etc. and provide them as needed. The agricultural demand can even go into flowers used for ceremonies or decorating. Thirdly, retailers can add to their existing stock or tailor what they sell based on the demands of their ethnic clientele.
As immigration fluctuates in the United States, so would the demand for their stock. Using data from research would help retailers understand the impact of immigration and population shifts. Adding to their existing stock does not even need to be based on immigration. This can be based on where the stores are located. In Texas, stores that are near the border have such diverse customers that bring the demand for items they are accustomed to buying in their native country. The idea of location also can expand to cities who have universities in them. Colleges with multiple ethnic groups are a great place to establish stores, vendors, or restaurants that cater to a diversified group. If you look at cities that have established ethnic communities, these are the areas that would be great to introduce a specialized grocery store.
I foresee as immigration grows in the United States, we will start to see more and more stores that specialize in certain ethnic groups. We will also see established stores continue to add to their stock as the demand grows. There are two ethnic groups on the horizon – Asian and Hispanic. Donna Boss states in her article that there is a tremendous opportunity due to the population growth in the U.S. She gives an example of a family-owned neighborhood grocery store founded in 1962 that has grown to 34 locations in Florida. Another example she gives is Vallarta Supermarkets, which began in 1985 who just recently opened its 50th location. Even though these stores focus on Hispanic ethnicity, they have found that other ethnicities are interested too. They also ensure that the store is employed by people from the local neighborhood. These stores began organically. They adapt to the community, cater to it, and market to it (Boss, 2018).
In conclusion, I feel that we can all benefit from retailers using ethnicity to diversify their products. We can use the specialized markets to enhance our palates or start a new hobby. It’s a way to embrace immigration and accept new cultures. If you are an entrepreneur, it would be a great way to look at the forecasting of immigration and see what the demand may be by that culture.
