In 2001, Advance Auto Parts realized it needed to learn Spanish—and fast. The nation’s No. 2 auto-parts retailer, behind AutoZone, had just acquired Discount Auto Parts with the heart of its store count in the heavily Hispanic South Florida area.
The company, with almost 3,300 stores, and annual sales nearing $5 billion, is dedicated to driving its automotive business in pursuit of the rapidly growing Hispanic market. Darren Jackson, the former Best Buy executive VP who was appointed president and chief executive of Advance Auto Parts earlier this year as part of the chain’s turnaround, has charged his executive VP and customer development officer Elwyn Murray with advancing Advance Auto Parts’ Hispanic initiative.
“The acquisition of Discount Auto Parts in 2001 immediately opened our eyes to a world of Spanish-speaking communities, the likes of which we had never seen before,” said Murray. “The education we gained from that acquisition allowed us to carry the initiative to other markets.”
Surprisingly, the “other markets” aren’t the ones that most people associate as being Hispanic. For example, Advance Auto Parts isn’t in Los Angeles or Phoenix. Instead, the Roanoke, Va.-based retailer is in Greensboro, N.C., Nashville and other seemingly Anglo cities.
“Our footprint is in roughly where 40% of the Hispanic population is,” said Murray. “Nonetheless, the Hispanic growth is occurring in the markets we’re in, and it’s critical for us to capture that.”
Critical, because Hispanics now account for more than 15% of the U.S. population, according to just-released Census Bureau data, and will grow to 30% by 2050. The group’s spending power is rising faster than the general population and, at $1 trillion, Hispanics have more disposable income than any other minority.
Building staff: The surest way to reach out to Hispanics, said Murray, is through in-store staffing. Research has shown that approximately 69% of first-generation Hispanics cite Spanish-speaking employees as the most important reason for shopping a certain retailer. In answer, Advance Auto Parts turned to Consorte (pronounced Consortay) Media, a San Francisco digital-marketing company that helps employers connect with the Hispanic online audience—which numbers approximately 20 million.
According to Consorte CEO Alicia Morga, tailoring an online recruiting and hiring solution for Advance Auto Parts, designed to attract Spanish-speaking staff, isn’t a one-size-fits-all approach. “Hispanics identify with more than just language or country of origin,” said Morga, who works with companies such as Best Buy and Advance Auto Parts to develop integrated marketing programs to target the Hispanic market. “We promote a metric-driven approach and testing what will work and what won’t.”
For Advance Auto Parts, Consorte developed marketing messages designed to attract bilingual employees at primarily the managerial level in selected geographic regions.
“Today we have Spanish-speaking team members in about 65% of our stores,” said Murray. “However, that’s not claiming victory, as we need many more. This is a hugely important ongoing initiative for us.”
Building brand: “The other dimension we’re dialing up in 2008 is our electronic-media spend targeted to Spanish-speaking customers,” continued Murray. The increase equates to five times the level expended in 2007. A new brand campaign, implemented through Dallas-based Richards Group, is intended to resonate with a Spanish-speaking customer base. Bilingual in-store signage, a tailored assortment, grassroots marketing efforts around Hispanic events and celebrations, and a Hispanic Council that includes Hispanic company leaders have put Advance Auto Parts on the path to a chainwide initiative. In the near future, Murray hopes, this program will be led by a single leader that will champion the movement across merchandising, marketing and operations.