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The 17th Annual
Buying Power of
Black America

A dollar-by-dollar breakdown
of the Black Economy

Plus:
The Leading
Advertisers In
Black Media


Published by
Target Market News

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Whole Foods becomes latest grocer seeking expansion by tapping black consumers

(September 4, 2013) The announcement today by upscale grocer, Whole Foods, that it plans to build a new store in Chicago's Englewood neighborhood should not come as a shock to the retail industry. It is simply the latest move by a major grocer to tap into the best opportunity for expansion: underserved black communities.

The growing competition between Walmart, Walgreens and now Whole Foods to go into these so-called desserts makes perfect sense to those who have seen the research. Black consumers of all income levels are demographically very desirable to retailers, especially those selling fresh fruits and vegetables.

According to Target Market News' report, "The Buying Power of Black America," black households have long been bigger spenders on fresh food stuffs than white consumers. "Typically for anything that has to be cooked -- meats, fresh fish, fresh vegetables -- black consumers spend more than whites or Hispanics," said Ken Smikle, president of Target Market News. "That's not because it costs them more, it's because culturally these foods are more important to how they traditionally eat and prepare meals. Grocers are realizing that getting them the foods they want is a big opportunity."

"The Buying Power of Black America" is an analysis of data compiled annually by the U.S. Department of Commerce. It is based on interviews and diaries collected from more than 3,000 black households, and is the most comprehensive survey conducted on Black consumers. This same data is also used as the basis for the U.S. government's Consumer Price Index.

The 105-page report breaks down how much of black consumers' $836 billion in income was spent during 2011 on clothing, entertainment, food, beverages, toys, consumer technology, cosmetics, autos, travel and dozens of other categories.

Black households in the Chicago metro area spent $3.1 billion on food. Of that, approximately  $130 million went to fresh fruits annually, with an additional $110 million on fresh vegetables. These two categories are both showing increases in black spending. Purchases of fresh fruits increased 21% in 2012, and fresh vegetables grew 16%.

Whole Foods co-CEO, Walter Robb, when asked by the media about the high prices usually associated with his chain, said that "It's a myth that fruits and vegetables are expensive" at his stores. Just as misunderstood is the notion that black consumers are willing to buy these items.

The chain recently opened a 21,000 square-foot store in Detroit, which Robb said was exceeding all expectations.

Top 10 Expenditures in All Black Households - 2011
(Figures shown in billion of dollars)
 
Housing and Related Charges $206.2
Food 70.7
Health Care 25.5
Cars and Trucks - New & Used 22.6
Apparel Products and Services 21.1
Insurance 20.6
Contributions 19.7
Telephone Services 18.2
Households Furnishings & Equipment 15.2
Media 9.7

Source: The Buying Power of Black America 2012

Click here for more information about "The Buying power of Black America" report.



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