How Modelo and Corona maker Constellation Brands won Hispanic consumer loyalty

October 12

Packages of Modelo Especial beer are displayed for sale in a grocery store on June 14, 2023 in Los Angeles, California.

Mario Tama | Getty Images

Modelo cans have become part of the fabric of events for Rio Riojas’ family and community in Lansing, Michigan.

The 35-year-old often finds himself opting for the brand at grocery stores or bars. The beer has become, in his words, “synonymous” with gatherings, ranging from small hangouts to birthday parties.

“It’s definitely the choice of the people,” said Riojas, a stand-up comedian. “When you’re at a quinceañera and you see everybody you know enjoying a couple beers at the table, it’s usually going to be a Modelo.”

Riojas is part of a base of Hispanic consumers that has become a focal point for Constellation Brands’ beer business, which also includes products such as Corona and Pacífico. What the company describes as an authentic relationship with this cohort of shoppers has boosted demand — and is part of why Modelo has become the best-selling beer brand in the U.S.

Recent data illustrates how Constellation has pulled ahead in the broader market by homing in on Latinos.

Hispanic- and Latino-identifying customers accounted for 32.5% of Constellation Brands’ sales in 2023, according to data from consumer research firm Numerator and investment bank Jefferies. This is despite the group comprising just 19.5% of the American population that year, as government statistics show.

Continued loyalty from these shoppers is partly responsible for Modelo hanging onto its spot as the most-bought U.S. beer by dollar share, the company said. Modelo was first able to eclipse Bud Light last year as the Anheuser-Busch-owned brand faced backlash following its marketing campaign that featured a transgender influencer.

“Hispanic consumers are the single most important consumer group for our beer business,” said Mallika Monteiro, executive vice president and managing director for Constellation’s beer brands. “It has been the foundation of how we’ve been able to drive growth over the last 14 years.”

The ‘fighting spirit’

Constellation’s connection to these brands started with importing them to the U.S. from Mexico. The company officially acquired the U.S. beer business of Groupo Modelo, which included Modelo and Corona, from Anheuser-Busch in 2013.

These brands have a natural pull among Hispanics given their roots in America’s southern neighbor, said Alexandra Aguirre-Rodriguez, an associate professor at Florida International University’s business school. But Constellation’s marketing and social responsibility efforts have helped the New York-based company maintain this relationship over time, she said.

Constellation’s Monteiro said the emphasis on the Hispanic community has taken root in the company’s focus on building a diverse workforce. The company also touts a multiyear donor relationship with UnidosUS, which is billed as the largest civil rights organization focused on Hispanics in America.

With the rights to market in the U.S., Monteiro said Constellation has focused on an “authentic” reflection of these brands as Mexican imports. After several years of advertising in Spanish-language programming, she said the company in more recent years brought its Modelo marketing campaigns to English-speaking media.

One popular spot focused on the role of “abuelas,” or grandmothers, in caring for and feeding their families. An ad released this year highlighted the work of California women who build low-rider cars.

Modelo’s “fighting spirit” tagline offers positive representation in media for Hispanics specifically, said FIU’s Aguirre-Rodriguez, whose research centers on the intersection of identity and branding. It can also resonate more broadly with immigrants coming to America in search of a better life, or their descendants — regardless of their origin country, she said.

“Time and time again, you see that there’s that strong bond that consumers form emotionally with brands,” Aguirre-Rodriguez said. “The self is a very important part of consumers’ decision-making.”

‘A good mark of the culture’

This connection can help Constellation weather a tough economic backdrop that’s been defined by a “choosy” consumer, according to Jefferies analyst Kaumil Gajrawala.

Gajrawala said one might expect Constellation to face trouble as consumers face economic challenges such as inflation and high interest rates. But he said the company is in a better spot than others in a similar position.

That’s because the Hispanic base is likely to reduce spending elsewhere in order to keep picking up boxes of Modelo or Corona, given their loyalty, he said.

“The business is more resilient than it may appear,” he told clients in June.

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How Modelo and Corona maker Constellation Brands won Hispanic consumer loyalty

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