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Nation’s largest minority
commands attention of
businesses, institutions.
Hispanic marketing might: With
nearly a trillion dollars in
buying power, the surging
Hispanic population has proven
they are powerful consumers with
money to spend. |
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In Down Times, Hispanic Market is
Booming
NUEVA HISPANIA
(By Timothy Sun and Alex Johnson,
NBC and MSNBC) March 4, 2010
―
With more than 46 million people,
Nueva Hispania is the 27th-largest
nation on Earth and the fourth
largest in the Western Hemisphere.
Its residents wield $1 trillion of
buying power in the marketplace.
Even as the rest of the economy
contracts in the global recession,
Nueva Hispania remains a thriving,
even booming, market that’s expected
to grow by 48 percent in the next
four years.
And it’s not even a real country.
The imaginary “Nueva Hispania” is
actually a substantial segment of
the U.S. population. Hispanics now
account for more than 15 percent of
the U.S. populace as the nation’s
largest minority group. And while
other demographic sectors are
growing only incrementally, the
Hispanic population is exploding:
The Census Bureau projects that 30
percent of Americans will be of
Hispanic and Latino by 2050.
The Hispanic market’s growing clout
comes even as the recession takes a
harsh toll on Latino workers. The
elimination of tens of thousands of
construction jobs has hit the sector
particularly hard, sending the
national unemployment rate for
Latino males to 11 percent.
For decades, businesses and cultural
institutions could afford to ignore
the Hispanic market. Now, they are
chasing it aggressively, because
that’s where the money is.
That poses a big challenge.
Underrepresented for decades in U.S.
commerce and media, Hispanic
Americans long ago developed their
own commercial, cultural and media
channels. And that means companies
and institutions can’t just throw
open the doors and expect Hispanics
to come in.
Those companies and institutions
must go to the customer.
“For companies to grow in the coming
years, it is critical to understand
how to reach and connect with these
consumers,” said Reinaldo Padua,
assistant vice president for
Hispanic marketing for Coca-Cola
North America.
‘I was actually scared, like most
Hispanics’
More than a third of the Hispanic
population is younger than 18. For the
Boy Scouts of America, that’s “a huge
opportunity,” said Robert J. Mazzuca,
the organization’s chief Scout
executive.
“There’s a lot at stake,” Mazzuca said.
“We’re not fulfilling our mission as an
organization if we don’t see this
incredibly rapidly growing and dynamic
part of our population and do everything
we can to reach out to them.”
To penetrate the cultural divides that
have kept Hispanics from joining their
ranks, the Scouts reached out to
Hispanic Communications Network, a media
company based in Washington that
specializes in engaging the Hispanic
community.
Together with HCN, the Scouts are
developing pilot programs in six cities
to reach the Hispanic market. There will
be radio and TV spots, bilingual and
bicultural staff representatives, local
community leaders advocating on their
behalf — and soccer.
“One of our pilot programs over ...
recent years has been Scouting in
soccer, using the attraction of the
soccer game to gather Hispanic families
around,” Mazzuca said. The sport is a
common interest that draws in families
while addressing the issues of
individual character development that
are at the heart of the Boy Scout
experience.
Rosa Gonzalez of Irving, Texas, whose
son, Jonathan, is in his first year with
the Cub Scouts, said she was skeptical
at first.
“I was not too convinced," she said. "I
was actually scared, like most
Hispanics. We tend to hold onto our kids
even when they’re older.”
But after being reassured by the local
Latino Cubmaster, Gonzalez decided to
let Jonathan join.
“They teach them respect, responsibility
and, you know, they’re more
self-confident in their decisions,” she
said. “I noticed that in my son, and I’m
very happy.”
Mazzuca hopes to replicate that success
across the organization.
“We have approximately 100,000 Latino
scouts in our universal scouting,” he
said. “We want to double that by the end
of 2010.”
Identifying the audience crucial
The word “Hispanic” is misleading.
Unlike many other minority groups,
“Hispanic” is not a race — it is an
umbrella word collecting people of
Mexican, Cuban, Puerto Rican and any
other Spanish or Latino cultural origin.
They are not united by culture or by
history, said Jeffrey M. Humphreys,
director of the Selig Center for
Economic Growth at the University of
Georgia, and Hispanics from different
cultures tend to cluster in cohesive
urban neighborhoods. What unites them,
Humphreys argues in “The Multicultural
Economy,” is simply the Spanish
language.
That means a generic appeal is not
enough, said Lorenzo Lopez, director of
multicultural media at Wal-Mart Stores
Inc.
“It’s not a matter of checking the
‘Spanish’ box” and calling it a day, he
said.
The goal is to connect to the culture in
a socially relevant way and make sure
each community’s specific needs is
served. For Wal-Mart, that means
tailoring individual stores to meet to
the demands of the local market.
The company installed a tortilla machine
in its store in Garland, Texas, a
heavily Hispanic area, and built a Pollo
Campero, a fast-food chicken chain
hugely popular in Central America, in a
store in nearby Rowlett. It put up
bilingual signs, stocked produce geared
toward Latino appetites and sold movies
and music skewed toward Latino tastes.
More than the Spanish language
AARP, formerly the American
Association of Retired Persons, began
applying the same principle about seven
years ago. Today, the organization has
1.2 million Hispanic members.
“Reaching the Hispanic community will
continue to be a key focus for us, and
we will continue to expand outreach
efforts to this demographic,” said
Emilio Pardo, AARP’s executive vice
president and chief brand officer.
The crucial point, he said, is not just
to translate existing programs,
publications and services into Spanish.
Instead, you have to “transcreate — to
be in the community.”
AARP “transcreates” through its magazine
Segunda Juventud, or Second Youth.
Billed as “the only publication for 50+
Hispanic Americans,” the bilingual
magazine tailors AARP’s five universal
pillars — health, financial security,
community, intergenerational issues and
fun — to the needs of Hispanic
communities.
Hispanics, for instance, tend to have
“stronger intergenerational ties than
the general population, with multiple
generations living under one roof,”
Pardo said. So the AARP’s caregiving and
financial advice is geared more toward
family-oriented caretaking at home, as
opposed to more independent caretaking
for its general audience of retirees
living alone.
Similarly, as its Hispanic members tend
to be younger, AARP may focus more on
college advice and tuition management.
In addition to the magazine, AARP also
uses an arsenal of podcasts,
Spanish-language radio broadcasts and
live events to get its message out.
In May 2007, AARP sponsored its first
national Hispanic event, drawing 16,400
people to Feria de la Segunda Juventud
(the “Festival of the Second Youth”) in
Puerto Rico, a two-day event that
featured 60 exhibitors, music, food and
celebrity appearances by the likes of
Gloria Estefan. A similar event is
planned for this May in San Antonio,
Texas.
“Nearly 8 percent of Hispanics are over
50, but what is much more important is
that this number is expected to more
than double by 2025, according to the
census,” Pardo said. “The considerable
population growth dictates that we look
at it as a business imperative.”
Hispanic ad firms thrive
One of the biggest beneficiaries of
the explosion in Hispanic buying power
is the U.S. Hispanic advertising
industry, which the Association of
Hispanic Advertising Agencies estimates
is growing four times faster than all
other sectors of the ad industry.
“Marketers now see that the Hispanic
market in the U.S. is a great business
opportunity,” said Sergio Alcocer,
president and chief creative officer of
LatinWorks Marketing Inc. of Austin,
Texas, whose accounts include
Anheuser-Busch, ESPN and Burger King.
It’s a sharp contrast from only a few
years ago, during the first wave of
Hispanic advertising in the 1980s and
1990s, when companies invested in the
Hispanic market “almost kind of like a
good citizen-type thing.”
The competition is especially acute
within the cell phone industry.
In 2006, industry research found that
Hispanics “over-index” in almost every
category: They use more minutes, make
long-distance calls, text more and
download more ring tones.
“Family and social bonds are stronger
than in the general population, and
Latinos communicate more with each
other,” said Isaac Mizrahi, director of
multicultural marketing communications
for Sprint Nextel Corp.
Both Sprint Nextel and AT&T Inc. have a
wide array of tools with which to
attract the Hispanic user. AT&T, for
example, has developed 716 Hispanic
Intensity Traffic (HIT) stores, where
all sales material and staff are
bilingual, in high-density Hispanic
areas.
In addition to a similar network of
bilingual stores, Sprint Nextel last
year sponsored the tour of the Colombian
rock star Juanes. The company released
singles for download before his album
“La Vida ... Es un Ratico en Vivo” was
released and provided video, ring tones,
concert information and the ability to
purchase tickets over its Sprint mobile
devices.
For Hispanics, Coke is it
Perhaps no other mainstream U.S.
company has been building bridges to
Hispanic customers longer than
Coca-Cola.
Coke’s forays in targeting Hispanics go
back more than 30 years. It has been a
worldwide sponsor of soccer’s World Cup
since 1978, frequently features Latino
players in its ads, and it had the
advantage of having had a strong
presence in Latin America: When
immigrants came to the United States,
they regarded the brand as an iconic
representation of their new homeland.
This month, Coke is launching a
marketing campaign centered on the
“American dream,” emphasizing the
company’s historic role in Hispanic
America’s immigrant narrative. The ads
will be bilingual, highlighting
Hispanics’ growing acculturation and
placing Coke itself as a bicultural
product.
“As a company, we identified (the
burgeoning Hispanic market) many years
ago and have strengthened the ... bond
that exists between Coca-Cola and
Hispanics,” Padua said.
“Any company who wants to grow must look
at the Hispanic market.”
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