NORTHFIELD, Ill. -- Kraft Foods here has established a corporate focus on ethnic marketing, and in the process has helped spur A.C. Nielsen, Schaumburg, Ill., to expand its data resources on Hispanic Americans.
The increased ethnic focus at Kraft was enabled by the business consolidation the company undertook at the end of last year, said John Bowlin, president of Kraft Foods. At that time the former Kraft USA, General Foods and Oscar Meyer divisions were brought together under a unified sales force.
Each former division targeted ethnic audiences, but their separate programs were "sub-optimal in scale," Bowlin said in an interview.
"We had inadequate data. We could not measure the results," he added. Without independent data, crucial quantities such as market share could not be tracked.
Hispanics represent roughly 9% of the U.S. population. Bowlin said Kraft confronted how much spending it was doing and "how little we knew" about its effectiveness.
Early in the year, the company named Kraft USA executive Lou Nieto to spearhead ethnic marketing, and it devoted a proportional slice of marketing resources to the activity. "It then became higher priority for Nielsen as it became clear to them around February or March that it was a high priority for us," he said.
Nielsen had previously gathered only limited data on Hispanic shoppers, from a few high-density areas such as Los Angeles, San Antonio and Miami, said Nieto. "They also needed to refine how to capture that data for comparison between Hispanic and non-Hispanic stores," he added.
In partnership with Kraft, Nielsen was able to add the Houston, Chicago and New York markets, and within weeks, new insights were flowing from the numbers.
Said Bowlin, "When you look at the category development and brand development indices, in some categories the ethnic skew is neutral, you cannot differentiate. In some others, the skew is significantly higher. Ready-to-eat cereal, Yuban coffee, Kool-Aid, sour cream and many cheeses are big with the Hispanic population."
The data also gave Kraft national projectable numbers, which he said are critical, so now any given brand can be rated in terms of its Hispanic business nationwide.
The new flow of data from those six markets has enabled Kraft to begin doing some customized Hispanic marketing there, and to fund them at what Bowlin called "optimal levels."
Targeted messages have already brought dividends to products such as Kraft Singles processed cheese, where the company met its latest national marketing plan with a volume increase of more than 3% for the nine months ended Sept. 30. In the same period, an alternate Hispanic marketing campaign, which features the use of Kraft singles for quesadillas, boosted volume 9%, Nieto said.
