By Nicole Akoukou
Originally posted on Latin Post.
Shifts have transpired, and the previously underserved Hispanic market has proven to be a mighty force to be reckoned with in 2014, and the upcoming year will likely prove the same.
Expert marketing opinions suggest that not only are Hispanics fit to assume the lead role when it comes to brand approval, but Hispanic marketers understand the finer nuances of the general market and the bicultural and diverse Hispanic market. That market understands commonalities and differences, as well as the fact that Hispanics didn’t come to the U.S. to assimilate into the U.S. culture, they arrived with a goal to achieve success in America, but not at the expense of the culture and customs of the home country.
Because of that desperate retention to customs and culture, the general market population has become Latinized. Without realizing it, we all experience the culture, taste the food and listen to the music. On the radio, Enrique Iglesias sings… half in Spanish and half in English… and a particular song sung by him and other bilingual artists can easily sit on the top ten list for several weeks, and be recognized in mainstream and the “minority” market. That content is promoted through not only the Hispanic market, but also the general market.
In a conversation with Hispanic marketing experts about the history and future of Hispanic marketing in America, as well as the tactical ways to approach the Hispanic market, Latin Post learned a great deal about the “Total Market” approach to advertising, the advantage of “native marketing” (based on insights) and the disadvantage of naïve and uninformed marketing strategies. The history and future of Hispanic marketing was also heavily discussed.
Joe Gutierrez, Managing Director at Pinta NYC, shared that brands that were able to accurately track Hispanic sales will have to go back to the drawing board in 2015 and focus more on building brand stories around culturally relevant Hispanic insights that better resonate with Latinos. Traditional vehicles for advertising, such as TV adverts, will receive less advertising dollars, and more money will be spent on eye-catching branded content development and native advertising. The agencies that have a proven track record in earned media/PR will be uniquely positioned to capitalize on the trend.
“We can expect to see more Hispanic spending in the Health sector. Aside from increased spending on health insurance, [over-the-counter] pharmaceuticals will continue to thrive,” said Gutierrez, when discussing how Latinos will spend money in the New Year. “Hispanics are disproportionality more likely to not have health coverage and therefore will continue to be more likely to self-medicate.”
He also stated that with an increase in disposable income, travel and mobile technology would also see growth. Also, beyond browsing and price shopping, in 2015, expect to see an increase in sales transactions being completed via mobile devices.
Latinos will choose which brands to give their money to based on a brand’s ability to effectively communicate. Flipboard, for instance, developed a U.S. Hispanic content guide, where they leveraged their news aggregation technology to partner with English-language and Spanish-language Hispanic content producers.
“Hispanic Marketing is not a translation exercise. A lot of larger, mass market agencies have gotten into the game by hiring a few professional Hispanics rather than Hispanic Marketing professionals,” said Gutierrez. “While consolidating all of your advertising with one generalist agency may save a few dollars in the short-term, the companies who are truly committed to effectively connecting with Hispanics via dedicated, complementary campaigns will reap the rewards in the long run. Like anything else, you get what you pay for.”
Over the last decade, Latinos have influenced mainstream market trends, impacted local and national elections, driven the bulk of small business growth and become more visible in government and the private sector. And while Latinos are integrating into the mainstream, they aren’t necessarily looking to acculturate, or become monolingual English-speakers. Hispanics are still tied to their culture and connected to their Latino roots. Because of this, advertisers know that they have to be fluent in biculturalism and diverse ideas.
“What we are seeing more and more is the integration of Hispanic casting and imagery in more and more mainstream or general market advertising. Much more English language targeting to the Hispanic audience indicates a recognition on behalf of many marketers that the Hispanic audience is no longer a niche audience, but a significant segment of the American mainstream,” Phil Polk, General Manager and PR Partner at PM Publicidad, said to Latin Post. “Advertisers from Toyota to Cheerios not only include Hispanic actors in their General Market (English language) advertising, but we are also seeing the integration of some Spanish language dialogue in English language broadcasts as a nod and acknowledgement to the presence and increasing prevalence of Hispanic culture in the U.S.”
The commercial success of series “Modern Family,” “Cristela” and “Jane the Virgin,” and music artists like Pitbull, Jennifer Lopez and Enrique Iglesias has shown that Hispanic viewers and consumers demand more attentiveness, and companies are paying attention. In Spanish and English, social and digital media increasingly cater to the Latino audience, hoping to seize some of the incredible wealth that the group has to offer. Smart marketers know that Hispanic consumers who speak English tend to have strong cultural ties to their community, and failing to acknowledge these ties and assuming Hispanic consumers will respond to advertisements that target an Anglo audience simply because its in English “is a recipe for disaster. ”
Polk shared that many companies interested in segueing into the Hispanic market do so by hiring a Hispanic agency to create a Spanish language ad and webpage to attract Hispanic consumers to their stores. Successful, the ad does its job and Hispanic customers call in, log in and drive in, but Hispanic consumers are then confronted with certain difficulties and confusion upon arrival:
1) The website may have a Spanish language landing page, but when the customer goes to purchase products, the commerce engine of the site is in English… this can feel very disingenuous.
2) The customer calls in to take advantage of the deal they saw on TV, but the phone representative doesn’t speak Spanish, or the customer is subjected to some clunky translator on the phone that ruins the experience
3) The customer goes to a store to purchase the advertised product but the store employees don’t speak Spanish
Because 40 to 60 percent of the Hispanic population is bilingual or English dominate, and Hispanics account for a substantial portion of the growth driven by U.S. births (not immigration) — many marketers feel that they only need to partially engage in Spanish. According to Polk, simply putting Spanish-language ads on TV is not enough to win the loyalty of these consumers. In the next 10 years, products and services will be developed with the Latino customer in mind, which will lead to a new influx of products inspired by the Latino audience. Strategies will include a point of view that acknowledges and includes the Latino consumer before its time to simply “do a commercial”.
“Hispanics have accounted for over 56% of U.S. population increases since 2005, this audience is no longer a fringe player in the American economy, but will bring its $1 trillion in spending power to the forefront in 2015,” said Polk. “While we should expect a continuation of a cash-based economy for some in the Hispanic segment, the increase in usage of traditional banking will lead to increases in use of the digital economy, led primarily by the 2nd and 3rd generation Latinos who will usher in others in the community.”
Linda Lane Gonzalez, President of Viva Partnership Inc., also shared her insights with Latin Post about Hispanic market strategies, Hispanic millennial spending and the evolution of Hispanic marketing in America over the last twenty years. According to Gonzalez, learning passion points, utilizing social media tactics, promoting technology and deviating from silos such as radio/TV are ineffective strategies for reaching Latinos.
“General marketers feel that they don’t have to speak to Latinos anymore because they use English to reach them. But reaching them is not engaging them, and it is certainly not selling them. In order to engage, you have to speak to Hispanic millennials culturally. You have to show them that you know who they are if you want to get closer to them,” said Gonzalez. “Ten years ago, clients still needed to be convinced that Hispanics should be a big part of their marketing effort. And there were a lot of myths that suggested that Hispanics could only afford to buy cheap products.”
But, over the last 10 years, we’ve been able to do research and statistics that prove that those stereotypes are untrue. The fact, Latinos consumers have just become important [to Marketers]. Before, it was like, “Okay, yeah, he saw my billboard…well, great.” Now, it’s, “Oooh, he looked at our billboard. Now look, we have an event over here. And also, let’s connect via social media. Ecommerce has become an essential part of Hispanics’ lives.”
Assuring that she isn’t BS-ing, Gonzalez predicted that in ten years, general market agencies will be predominately Hispanic or multicultural focused, “because that the way of the world.” And the U.S. will be a “multicolored, much more interesting country. Marketers who fail to see things the same way will be a minority.”
“[Hispanic millennials] do a lot of research online, and they read a lot of reviews… over indexing far more than the non-Hispanic market. They’re talking to their friends and their families about products, and they really get to know the brand online,” said Gonzalez. “But unlike non-Hispanics…or Anglos… they’re going in-store to buy. They do a lot more buying in-store than non-Hispanics. They’re the group that’s probably going to keep the malls alive.”
They also like the club stores…though Hispanics in urban areas are not big club goers because New York and Chicago doesn’t have the space for them. The clubs offer deep discounts and it’s a fun shopping experience, granting an opportunity to try new foods, and there’s lots of sampling going on. It’s not about the destination, it’s about the journey.”
The expert also said that Hispanics are also touching so many screens, and leading rich and productive lives. They over index in tech (ex. Tablets and smartphones), and they use that tech to communicate, purchase items and conduct financial business. For that reason, marketers must use a combination of methods to really understand the consumer, and tune into insights so that the Latino audience receives the intended message and spends some of their many dollars on a particular brand.
The experts, Gonzalez, Polk and Gutierrez offered some additional marketing insights and tips for brands, marketers and campaigns to consider in 2015 and beyond:
Linda Lane Gonzalez: “Don’t hire general market agency to engage Hispanics, or a director or a copy editor, just because they happen to speak Spanish. Just because you’re Hispanic or speak Spanish, it doesn’t mean that you’re going to give that strategic perspective, or consumer insights or expertise in the market. Instead, encourage a Spanish language agency and your general market agency to work together from the beginning, so they work one strategy that they can be built together, and it can be executed differently so that it resonates with the varies community market segments that are multicultural. Don’t do “back-in” strategy, because if you do the back-in strategy, multicultural people will know that you’re doing the back-in strategy.”
Joe Gutierrez: “I’ve been fortunate enough to work for great General and Hispanic Market advertising and marketing agencies for the last 20 years. One truth that remains constant is the fact that this business is part art and part science. I’ve witnessed companies increasingly, and often times unsuccessfully, using technology and proprietary planning methods to try to streamline the process to shift the balance more from art to science. The reality is that this is a people business. It’s about staying on top of trends and reacting accordingly. It’s about being able to engage in conversations and not about delivering scripted monologues for whatever you may be trying to sell.”
Phil Polk: “In the next 10 years, Latino engagement will not be relegated to a “multicultural marketing department” but will be part of the CEO and CMO’s scorecard and evaluation. Companies will see the U.S. market as a heterogeneous marketplace that must be addressed based on behavioral and cultural needs and, when that happens, culturally based Latino needs, insights and behaviors will be addressed in a way that better serves the overall U.S. economy.”