Michael Hissam shares the second part of his interview detailing Merka’s Cross Border research findings.
One never knows what consumers will buy.
Last year, a consumer survey by Norma Mendoza, president and CEO of MerKadoTeknia Research & Consulting with support from a Mexican media partner, revealed a few surprises destined for El Paso’s cash registers. The survey of 662 respondents revealed that “they shop for apparel, they shop for groceries, they come and buy electronics and home appliances,” she said in listing the top categories for shopping.
“Surprising” to Mendoza and her team was the origin of the respondents.
As expected, the bulk came from Ciudad Juárez. If you know what “tapatío” means, you see that some came from unexpected places to spend in El Paso.
Those consumers could have gone elsewhere down the rio and saved some mileage.
As promised last week, a “Quickie Quiz” might also offer a few surprises when it comes to what goes back with the consumers on the return trip.
Q What is the dollar value of merchandise that can be imported into Mexico by a shopper without having to declare?
A. $150 per person
B. $500 per person
C. $1,000 per person
D. $10,000 per person
A The correct answer is $150 per person. This is an interesting question that we asked because during the Christmas season the restrictions are relaxed and every person can cross up to $300 in merchandise value per person, per car. If you have a car with four individuals, you can actually multiply 4 times $300 and your merchandise value can be up to $1,200 without having to pay any taxes.
Q When Mexican shoppers come to El Paso, what percentage of them stays two days or more?
A The answer is 9.5 percent. That is to say, a number of our shoppers come here and stay to shop specifically for more than two days. This means that they stay at hotels; they require meals. They require additional services, and our market should be very sensitive to this kind of pattern.
Q How far did shoppers travel to shop and spend in El Paso?
A. 160 miles
B. 253 miles
C. 537 miles
D. 954 miles
A The answer is D, 954 miles. This is the distance from Guadalajara, Jalisco, which is a city in southern Mexico and these folks were coming all the way to shop in El Paso. Given that they could have gone to any other border town, we were very surprised and quite happy to see that they are choosing to come to El Paso to spend rather than go to Laredo or to any other border town.
Q What percentage of people spends between $500 and $1,000 during each shopping trip?
A The answer is 5.7 percent. While a larger group of people spend between $100 and $200 every shopping trip, there is a significant group of people, 5.7 percent, who spend $500 to $1,000 during each shopping trip. So, if they are coming every week or every month, that’s how much they bring with them to spend in El Paso.
Q “Typical” and “average” are dangerous words in journalism when it comes to describing people. However, based on your study, how would you characterize a shopper coming over to El Paso from Mexico?
A If we were to summarize the typical cross-border shopper in the El Paso region, we would say it’s a male, between 36 and 45 years old, who is coming to spend between $100 and $200 every shopping trip. They return that day or if they stay overnight, they stay with family and friends. They come specifically for shopping, though a number of them also come for entertainment.
Q Your findings seemed to challenge a paradox: “There’s nothing to do in El Paso”?
A About 29 percent of the people come for entertainment despite El Paso’s reputation of being a sleepy town, with nothing to do. When we asked the people what sort of entertainment they come to patronize in El Paso, they mentioned sporting events, concerts, outdoor events, museums, the zoo and this was beyond shopping. That’s an entirely new category that I don’t know that we fully understood. They come for restaurants, they come for nightclubs. They come on a regular basis to seek different types of entertainment that they might not find in their native land.
Q Reader feedback from last week said the results could be significantly different if you went to other crossings and conducted the same survey. To what extent are you and your team ready for that challenge?
A We are very inspired and we are very excited at the response we got in only two days, so we are going to repeat the study in all the border crossings, in Zaragoza and the Downtown bridge, and in Santa Teresa. We are going to do it again in the summer, anticipating that in the summer we are going to see a pattern that are more related maybe to traveling, to tourism or maybe back-to-school shopping patterns. We are also going to conduct focus groups in Juárez and Chihuahua, which are the main two areas where people are coming from, to address issues of customer service and issues consumers would like to see improved when they come to shop in El Paso. Ultimately, this benefits our economy locally and we want to make sure these shoppers come, spend and return often.
Footnote: During an interview at last week’s Supply Chain Summit, one executive reinforced the Guadalajara note. He and his family fly into Juárez, rent a car and then head into El Paso to spend.
He told me, “It is easier and better than San Antonio.”