Less than a month into the New Year and the e-retailer and marketplace announces plans for three additional U.S. fulfillment centers.
Language remains a barrier to reaching online Hispanic shoppers. The question: How big a barrier?
Hispanics represent the fastest-growing group in the U.S. population and among Internet users, and about half of online Hispanics prefer Spanish-language web sites. Yet most major online retailers neither provide web content in Spanish nor respond to customer inquiries in that language.
Some retailers say they don’t see customers clamoring for Spanish web content. And many are daunted by the considerable cost of translating an e-commerce site, continually translating new content as inventory changes, and providing the Spanish-language customer service that Hispanic shoppers would expect.
But at least two of the 50 largest e-retailers, consumer electronics chain Best Buy Co. and online florist 1-800-Flowers.com Inc., have in the last nine months launched Spanish-language sites duplicating nearly all the content of their English-language sites. Their initiatives, and a more modest effort by smaller online retailer PlumberSurplus.com, provide a glimpse of what it takes to serve customers in Spanish and how they respond.
While Best Buy isn’t providing sales figures, it says many Spanish-speaking customers have commented favorably on the Spanish content. And the Spanish site gets higher marks on such survey questions as “Would you refer to a friend?” and “Would you return?” than the English site, says Ana Grace, the retailer’s Spanish site manager.
The way customers use the site suggests they are hungry for Spanish content, although Grace says it’s too early to draw firm conclusions. “Customers are spending roughly double the amount of time on the Spanish site as English-language customers,” Grace says. “We’re wondering, is that because they haven’t had this level of detail before and are really digging in? We’re not sure.”
Spanish speakers may well feel deprived of opportunities to shop online in their own language because most e-commerce sites are English-only. Only 18 of the 102 largest online retail sites had any Spanish content in late 2006, according to research firm Common Sense Advisory Inc. Seventeen of the 102 sites responded in Spanish to all three Spanish e-mail inquiries researchers sent in August 2006, an improvement from two in a similar test two years earlier.
Despite the lack of Spanish content, Hispanics are buying online. They spent $12.8 billion on the web last year and will spend $21.6 billion by 2011, estimates research and consulting firm JupiterResearch LLC.
But online retailers may be able to reach most of those consumers in English. Only 32% of Spanish-dominant Hispanic adults use the Internet, versus 76% of those who are bilingual and 78% of Latinos who mainly speak English, according to a 2006 survey by the Pew Internet and American Life Project.
What’s more, only 23% of online Hispanics who prefer Spanish have ever purchased online, versus 41% of English-preferring Hispanics, according to a 2007 Forrester Research Inc. report. And Spanish-dominant consumers have less to spend, as their average household income was only $26,800 last year, compared with $45,000 for bilingual Hispanics, $56,200 for English-dominant Hispanics and $60,200 for non-Hispanics, Forrester says.
Most retailers don’t need Spanish-language sites to reach their customers, argues Fernando Espuelas, chairman of Voy LLC, operator of bilingual Latin music web site Voy Plaza. He views the Hispanic market as bifurcated between mostly Spanish-speaking, older and less affluent immigrants and younger, native-born Latinos who mostly speak English.
“If a product is aimed at an early arrival Hispanic, Spanish is a must,” says Espuelas, who was born in Uruguay and came to the U.S. in 1976 when he was nine. “But if someone has a credit card, the chances are low that he can’t transact in English.” The Voy site is bilingual in order to address Latin American consumers, but also, Espuelas says, to signal to U.S. Hispanics “that this is a Latin space.”
Not all agree. A Forrester survey last year showed that, while only 23% of Hispanic consumers require Spanish, a total of 51% prefer using Spanish web sites. And 28% said they were more likely to trust a company with a web site in Spanish. “A Spanish-language site is not just about reach but is also about brand trust and customer goodwill,” says Forrester analyst Tamara Barber.
For retailers considering launching a Spanish site, cost is a major stumbling block, Barber says. “Not only do you need to translate it once, but you continually have new inventory coming, so you need to be able to translate quickly and inexpensively,” she says.
Completely translating a major web site can cost “a couple of million dollars” and retailers can expect annual maintenance to run about 30% of the original cost, says Chuck Whiteman, senior vice president of client services at language service provider MotionPoint Corp., which provided the translation and serves up the Spanish-language sites for Best Buy and 1-800-Flowers.com.
Those retailers would not comment on what they’ve invested in their Spanish sites, but say fast turnaround has not been an issue. MotionPoint translates new product information for Best Buy within 12 business hours, and can do it in four hours for a higher fee, Grace says.
Offshore translation services can be surprisingly inexpensive, says Espuelas of Voy. While not saying how much he’s paying, Espuelas says he gets good results from a translation team in Argentina whose work is checked by in-house personnel.
Best Buy’s strategy
While there is debate about the value of translation, there is little about the growing importance of Hispanic consumers. The U.S. Census Bureau reported last month that the U.S. Hispanic population reached 45.5 million as of July 1, 2007, when it represented 15.1% of the U.S. population and was the largest and fastest-growing of U.S. minority groups.
In certain states, Hispanics make up a much larger share of the population, the Census Bureau says. Hispanics represent 44% of the population of New Mexico and 36% in California and Texas.
It was feedback from store managers in the Southwest and Southern Florida about the importance of Hispanic customers that led Best Buy to review its strategy for reaching Hispanics about 18 months ago, Grace says. The retailer decided to take steps to enable customers to shop in Spanish in stores, on the phone and via the web, she says. “We want to connect to customers in the way they prefer and the language they prefer,” she says. “It’s not just about building a web site.”