Serving Multi-Cultural Households and Small Businesses at Retail

Serving Multi-Cultural Households and Small Businesses at Retail

August 4, 2021
Sally Smithwick
TrendsRetail Industry Insights

By Sally Smithwick, Managing Editor

At the 2021 RDBA Virtual Experience, the panel on Cross Cultural Micro Marketing at Retail proved to be a great start to more dialogue on meeting the needs of and communicating to multi-cultural households. Moderated by Annette Maggi, MS, RD, LD, FADA, RDBA Executive Director, we heard valuable insights from Mike Lancaster, Business Manager at United Supermarkets, LLC, and Sarah Putnam, Director of Operations at Coborn’s, Inc.

Let’s start with some perspective on the buying power of multi-cultural households in the U.S., which according to latest data from Acosta is now $3.9 trillion.

"Multicultural households continue to be a driving force of purchasing power and will account for half of the U.S. population in less than 25 years. This means understanding multicultural consumers and their shopping habits is key for grocery retailers to connect with an emerging group and provide a more personalized customer experience," said Colin Stewart, Executive Vice President, Business Intelligence at Acosta.

But how do retailers identify these shoppers and learn what the needs of these communities are? Coborn’s has around 120 stores including grocery, liquor, and convenience with an 84% white clientele in Minnesota and South Dakota. In St. Cloud, MN, Sarah Putnam oversees 12 grocery stores, but something unique happened in her St. Cloud store that led to the addition of an East African food set. She says corporate called noticing a growing number of Somali residents in the community, indicating small markets that offered products appealing to them were popping up. Putnam says they also found that many Somalis were shopping in her store, but they were only buying produce and not shopping any other categories, so she started talking with her Somali employees and touring some of the other markets that had East African products.

Putnam worked with a Somali from the community to find a distributor that sourced products that East African guests may need. The results were discovering, particularly during the height of the pandemic, that the biggest items were juices and beverages, powdered milks, large bags of rice, pastas, many varieties of dates, spices and their number one seller, tuna. After offering these products close to the produce section, she began to track larger basket sizes from these customers.

Mike Lancaster, who has 39 prior years’ experience as a distributor of natural, organic, local and specialty items, has been a buyer for six years with United Supermarkets. Since 1998, United made a commitment with their Market Street stores to offer “better-for-you” products. Reaching out to colleagues and business partners, this has organically led them to sourcing many products from black and women-owned companies. And as Lancaster says, many of these companies are small, so often times they make considerations to help them get their products on the shelves. “For smaller companies, until they can get to certain economies of scale, it has made it harder for them, so we help them.”

In fact, United has measured success of these small business programs by involving them at events. For example, on International Women’s Day they featured these companies and their products in digital and print ads at no cost to the companies with a goal to give them exposure. He also says their dietitian team has helped tremendously by bringing the “romance” aspect to their campaigns but writing copy that tells the stories of these women and black-owned businesses. Additionally, Lancaster works with these companies on communicating on their website which stores they can find their products on the shelves.

Although Lancaster sources a lot of items from one distributor, he also works directly with small vendors, making cost allowances on a case-by-case basis.

At Coborn’s in Minnesota, Putnam faced challenges working on their East African food set with language barriers with regards to customers as well as packaging on the products they were hosting. In addition, she says since these were items coming from East Africa, the packaging is different and sometimes does not hold up well. They also found that UPC codes coming from across the globe had extra digits and would not register in their system. Add to that a global pandemic, and you also face shortages, making it even trickier to support this small food set.

While staying committed to working with smaller companies and making the deliveries financially worth their time, Putnam also found that their greatest marketing tool was word of mouth. Once they were able to get some Somali shoppers in the store, the word quickly spread around the community. And retail RDs collaborating with Putnam even found ways to communicate to non-English-speaking adults through their children.

We should expect to see more focus on native foods and multi-cultural households in grocery where retail RDs can work help bring these customers into the family and support their needs.