Considering that Latinos make up the largest ethnic group in the United States and Latino buying power is on an upward march, you'd figure Spanish-language networks would be fighting advertisers off.
This week in New York, where the bulk of the commercial time for the upcoming television season will be sold at what's called the upfront market, Univision and Telemundo will need to make hard sells.
Advertising spending on Spanish-language media has been growing, rising more than 14% last year from 2005, according to Nielsen Co. But only 3.2% of total national television and print advertising is directed at Spanish markets in the Spanish language, TNS Media Intelligence has found.
What's more, recent research by the Assn. of Hispanic Advertising Agencies determined that of the country's top 250 advertisers, about 100 don't market in Spanish at all, and many of those that do aim less than 1% of their promotional budgets at Latinos.
A large group of advertisers — mainly in the banking, investment and technology industries — question whether they need to reach out to Latinos en español or whether their messages are getting across in English.
For Univision, this is irritating. Recently purchased by a group of private investors, the network's debt is about $10 billion, and it needs to ramp up advertising revenue. The investors are counting on Chief Executive Joe Uva, an advertising industry veteran who until this year led OMD Global Media, one of the world's largest advertising firms.
Although Univision is considered a player in the big leagues, able to compete for audiences with ABC, NBC, CBS and Fox, it doesn't command the same price for advertising time as the English-language networks do. Overall, on a national level, 30 seconds on Univision or Telemundo is 40% to 50% cheaper than 30 seconds on an English-language network.
Univision's plan is to convince advertisers in New York that Spanish-language viewers are more loyal than others, less likely to own Tivos and other digital video recorders — making them less likely to zip past commercials — and more willing to accept product integration in their favorite programs.
Dennis McCauley, an Irish American who is co-president of Univision's network sales and marketing division, knows about the loyalty. When he's in public wearing a jacket or shirt bearing the Univision logo, inevitably he is buttonholed by telenovela aficionados or viewers who want the latest gossip about the network's hunky national news anchor, Jorge Ramos.
"The intensity of the relationship and the connection with the brand is like nothing I have ever experienced," said McCauley, who added that he rarely had such experiences when he worked for sports cable channel ESPN. "That is going to be the focus of our message this year."
For its part, NBC Universal's Telemundo has teamed up with Clorox, IKEA and other brands to integrate their products into the story line or as part of the sets of Telemundo's telenovelas. Unlike Univision, which buys its novelas from Mexican network Televisa, Telemundo is producing its own soap operas and is using them to entice advertisers.
"We can sit down with clients and say, 'OK, tell us what your business needs are' and then we can create original content," Telemundo President Don Browne said.
Univision, which maintains that the majority of its viewers are bilingual, says its "sweet spot" is the audience that all advertisers covet: adults ages 18 to 34. According to Nielsen Television Index, Univision drew more viewers in this age group than any other network 41% of the time during the sweeps period in February.
Telemundo, a distant second to Univision in market share, also says its largest viewership is bilingual, though its age group skews older.
On a weekday afternoon or evening, the typical Telemundo and Univision viewer would seem like the ideal customer for toy manufacturer Fisher-Price: young mothers or grandmothers.
But Fisher-Price dropped its Spanish-language television campaign in 2005 after concluding that it was reaching Latinas with young children on English television and with grass-roots print advertising.
"We have found that [Spanish-language campaign] didn't increase awareness … because it was readily understood in English," said Brenda Andolina, director of brand marketing for Fisher-Price. She noted that ads for toys, showing happy children playing with cheerful music in the background, faced few language barriers.
For Fisher-Price parent Mattel Inc., the lack of weekday children's programming on Spanish-language television is a problem. To hawk Hot Wheels or Barbie, Mattel goes to Nickelodeon or the Disney Channel, which are big with the elementary school-age crowd.
Beyond that, Spanish-language TV isn't valued as highly as English because there's less variety in the prime-time lineup. Original episodes of popular shows air once a week on an English-language network, but on Univision and Telemundo, prime time is dominated by the same telenovelas series every night.
By contrast, "when you only make 22 shows per year, every original episode is a jewel, and it is sold that way," said a former Spanish-language television executive who did not want his name used because of the sensitivity of the negotiations.
Among some advertisers, there's a suspicion that Spanish-language viewers don't have a lot of money to spend.
"The image in much of corporate America is that these are not upscale folks," said Harry Pachon, president of the Tomás Rivera Policy Institute, a think tank that studies issues affecting the Latino community. "In reality, hundreds of thousands of Hispanic families have joined the middle class — over 3 million families in Texas and California alone."
When Henry Cisneros was president of Univision from 1997 to 2000, "we had Pampers" ads, Pachon said, but "what we needed was American Express and Delta Air Lines."
Cisneros, now chairman of CityView, an investment firm that finances builders who make homes for working families, said some advertisers needed to be educated about the facts: Latinos, like immigrant groups before them, are moving up the economic ladder. And they watch Spanish-language programs in addition to shows on English-language TV.
Apple Inc. is among the companies that spend little, if any, on television ads in Spanish, even though iTunes, Apple's online music stores, has a large inventory of Latin music.
"They are not advertising to young Latinos using the music that they are into," said Carl Kravetz, an advertising executive who is on the board of the Assn. of Hispanic Advertising Agencies. "If you are not talking to people, how do you expect them to know about you?"
An Apple spokeswoman didn't return calls for comment.
Companies that do advertise in Spanish have found it effective, after careful study of unique cultural preferences.
"We look at our brands and we say, which are the ones that it makes sense to support in Spanish?" said Tony Gerst, vice president of multicultural marketing for Clorox Co. "Do we have a critical mass?"
Clorox learned that Latinos bought liquid bleach and Kingsford charcoal, for instance, but weren't interested in cat litter or KC Masterpiece barbecue sauce.
Procter & Gamble discovered that Latinas were more likely to prefer scented products compared with the general market. So Danielle Gonzalez, senior vice president of Tapestry, one of the nation's largest advertising companies, created a mini-novela — "El Secreto de Jazmín" — to sell Secret body spray. The five 30-second episodes, which ran every day, featured a young woman who surmounts her problems by wearing lavender and floral scented body spray.
"Within weeks, we saw a lift" in sales among Latinas, Gonzalez said.
When furniture manufacturer IKEA recognized that it wasn't capturing the large Latino demographic in cities such as Los Angeles, it started advertising in Spanish and noticed results: more Latinos in stores. This year, IKEA launched a series of "vignettes" on Telemundo that run after the soap opera "Dame Chocolate" ("Give me Chocolate").
It features two specially designed bedroom sets made for the soap opera. Karla Monroig, a leggy, blond actress who stars as Samantha in the novela, smiles into the camera and promises in Spanish: "You too can have a room like Samantha, if you go to IKEA. I'm in love with the room they built for me!"
Maria Lovera, deputy marketing manager for IKEA, said that "translating commercials is not enough. You have to understand and participate in the culture."
"The brands that are forward thinking will understand this opportunity," she said. "Hispanics are very, very loyal."
Lorenza Muñoz, Los Angeles Times. May 15, 2007
Copyright © 2007 Los Angeles Times. All rights reserved.