Carlos Slim’s América Móvil bought Tracfone Wireless in 1999 and targeted Hispanics with pre-paid mobile services. It used its knowledge of the pre-paid wireless market in Mexico and Latin America to quickly become a market leader in the U.S. Tracfone now has more than 20 million subscribers nationwide and 30% of the fragmented pre-paid market.
Gruma entered the U.S. in the late 1970s, first operating in California and then Texas, producing and selling tortillas to the Hispanic market. Today Gruma is the major producer of tortillas and wraps in the U.S. and has operations in China, the U.K., Central America and Venezuela. It operates 25 bakeries and flour mills in Texas, California, Indiana and Kentucky.
Grupo Modelo, the Mexican brewer of Corona Extra, and Televisa, the Mexican media giant and minority stakeholder in Univision, have followed a similar pattern in the states.
The growth of the Hispanic population has helped Mexican companies get established in the U.S. and increase their profits despite a weak U.S. economy. In turn, the success of these companies and brands has helped create jobs in the U.S. and encourage more trade.
But the secret is out. The Mexicans have proven that the U.S. Hispanic market is lucrative and that it can be a gateway to mainstream success.
I wonder if U.S. companies and brands will catch on.