Evaluate an international expansion strategy for Goya.
Goya Helps Latinos Maintain Mealtime Traditions
Eighty years ago, Latino immigrant Prudencio Unanue and his wife longed for the comfort foods of their home, so they started an import business to satisfy the need. However, a few years later, the Spanish Civil War broke out, and they could no longer obtain the foods they wanted for their business. So they began importing sardines from a cannery in Morocco. “He had to do something. He had four kids, and we had to eat,” recalls his son, Joseph A. Unanue, now in his 70s. The elder Unanue bought the brand name, Goya, along with the sardines. The name cost an extra dollar. Throughout the years, Unanue added olive oil, olives, and other products the Latino community in America requested. During the 1960s, Goya began canning everything from beans to coconut juice. Today, Goya serves up entire menus of beans, rice, pasta, seasonings, beverages, and a variety of specialties. On the surface, it might seem to be a simple matter to import and manufacture food products to serve what appears to be a niche community. But it isn’t.
First, the Latino population, including immigrants and descendants, now accounts for 13 percent of the U.S. population. By 2050, Latinos will make up about 25 percent of the population. Thus, Latino consumer tastes are becoming more and more a part of the mainstream, not to mention a huge segment of purchasing power. Second, there is no such thing as a single Latino population. Although Goya was originally founded to serve consumers of Spanish descent, American Latinos come from a variety of countries, from Puerto Rico and Mexico to Nicaragua and Cuba. Their cultures, family structures, attitudes, and tastes in food are different. “Latinos from different countries eat different foods,” notes Andy Unanue, Joseph’s son and likely successor as CEO.
But Goya is ahead of other marketers in pinpointing the location of different populations. We know which Latinos are moving into what regions before anybody else,” says Andy. Goya often ends up serving different groups of Latino consumers within the same geographical region. But its marketers know that Cubans prefer black beans, while Nicaraguans want small chili beans and Mexicans will buy pintos. So they provide all three-and more. Changing roles in Latino families have also reflected a change in purchasing habits, and Goya has adeptly kept up with the times, serving both the young and the old. Latino seniors still want to create their own meals from scratch; they don’t want packaged or prepared foods. So Goya offers a full complement of ingredients for this market. But “the younger people are busy, they are used to the microwave, and they want to eat those things they grew up on that they don’t have time to make or can’t make as well as their mothers,” explains Mary Ann.
So Goya provides a wide range of rice-and-bean mixes and other foods that can be prepared quickly by working mothers or fathers. The company Web site offers even more help for this new generation: a section with favorite recipes that includes menus for holiday celebrations and other occasions. By being first to the grocery shelves decades ago, Goya established itself as the premiere Latino food brand, and it has been discovered by more and more non-Latino consumers who are becoming more interested in Latino foods. Moreover, Goya has managed to ward off attempts by larger companies to tread on its turf by simply producing higher-quality, more authentic products. “We firmly believe that Latinos like buying things they consider their own, that are authentic,” remarks Andy Unanue. “And we are. We’re Latino and we give them authenticity.”
Not only do Latino consumers prefer Goya’s authenticity, but so do non-Latinos. Thus, after failed attempts to introduce their own Latino food lines, giants like Campbell’s Soup are trying to compete by purchasing genuine Latino food businesses. Goya is watching carefully. Goya remains a privately owned business steeped in strong family tradition, with no plans to change the way it operates. Although Goya products generally represent low-involvement purchase decisions, consumers relate strongly to the traditions these products represent. When they fill their shopping carts with Goya rice, olives, and salsa, they feel like members of a community.
Question
1. Evaluate an international expansion strategy for Goya.
2. Should Goya consider entering Latin American markets?
3. What are some of the research issues that Goya needs to consider when tracking Latino subgroup?
