Through a special arrangement, what follows is a summary from a current article from Private Label Buyer, presented here for discussion.
Private label earned only 6.8 percent of the growing ethnic foods category, with Mexican/Hispanic and Asian brands such as Tostitos, Pace and Kikkoman dominating, according to a January 2012 report from Mintel. But that could change if consumers became more convinced of private label authenticity, according to the report.
Younger households, families with children, and those earning more than $75,000 represented especially promising targets for private label ethnic brands, Mintel says. The report suggests that ethnic food be moved out of generic-sounding "international" aisles and introduced more appealingly to a broader range of consumers through signage, in-store education, cooking classes and sampling efforts.
Overall, Mintel expects the ethnic food category to expand 5 to 6 percent annually through 2016, reaching $4 billion. Growth is expected to be driven as immigration continues, native-born Americans further diversify their palates, and the slow-growth economy keeps families eating at home more.
Euromonitor International also believes that younger Americans who make up the Millennial generation comprise a promising target for ethnic foods. More of these consumers have Hispanic and Asian backgrounds as well as more adventurous eating habits and a desire for healthier options provided by food cooked in spices rather than fats and oils.
Euromonitor predicts that consumers will move beyond more established Chinese and Mexican offerings — which are not seen as much more "ethnic" than Italian food — to other ethnic and regional cuisines such as Indian, Korean and Vietnamese. Private label players such as Whole Foods and Trader Joe's have entered this space already through ethnic frozen ready meals like Korean bulgogi, a barbecued beef dish.
According to a study from Consumer Science, most consumers cited price as their main motivator for buying private label ethnic foods, although younger consumers were somewhat more likely to cite quality rather than price.
Private label ethnic food need not be "ethnic as in cheap ethnic," said Ann Stettner of Wild Thymes Farm, Greenville, NY. "It's high-quality ethnic at a cheaper price."
Also, retailers that segregate Hispanic products into a "Hispanic products section" potentially will lose otherwise interested Anglo consumers, says Jim Wisner, president of Wisner Marketing Group.
"Unless it is products that nobody in the United States would typically buy, it doesn't make sense" to segregate, he says. "Better-selling items that appeal to a broad base of people ought to be marketed where they belong," which leads to "reverse acculturation," he said. "The United States is learning to be more Hispanic."