• by Alex Miller , April 28, 2005

With a combined purchasing power of more than $700 billion and a population growing by an estimated 1.7 million annually, U.S. Hispanics represent a demographic marketers are belatedly warming up to. Ad spending targeting Hispanics is expected to top $3.6 billion by 2007. Hispanic women, who often function as head of their household, make many of the purchasing decisions for their families.

An efficient strategy for marketing to them goes beyond merely speaking Spanish, but recognizing the diverse cultures Hispanic women come from, says Myrna Sonora, marketing director with the Michaels/Wilder Group based in Peoria, Ariz. Sonora joined the agency, which has a strong focus on multicultural marketing, after spending 20 years at Univision, the dominant Spanish-language TV network.

"It seems like there's a waking up to this reality," Sonora says, noting that U.S. companies no longer doubt the viability of the Hispanic market.

Marketers, Sonora says, need to understand a few things about Hispanic women. The first, she says, is that they are price-conscious, but not to the exclusion of all else. "Buying the best quality is somehow identified as a way to take care of your family," Sonora says. "Hispanic women are very brand-loyal; they stick to what they like and they're not easily swayed by price point." Brand loyalty, though, can be overcome if there's a product that represents a real improvement or technological advantage, she says. "It's seen as a progressive thing to do, trying something new."

The Vendors Television has been the media of choice for the Hispanic market for years, accounting for 64 percent of ad spending in 2004, but other media are starting to make inroads as the market burgeons. As the number of Hispanic households with incomes over $100,000 continues to increase, so too do the number of computers found in those homes. Marketers that are online via Spanish-language portals have a gateway into these households.

AOL Latino has cultivated close relationships with advertisers in its "Estilo de Vida" (Lifestyle) section, which is one of the most sought-after areas on the AOL service. Notably, the section has been home to successful campaigns by General Motors and Ford Motor Co.

"We feel that the audience in this channel, which is particularly women, is not often addressed this directly by the automakers," says AOL spokeswoman Lori Dolginoff. The travel category has also performed well  advertisers include Spirit Airlines and Intercontinental Hotels. The home and kitchen sections have outperformed some of the other areas on Latino, she says.

Yahoo! targets Hispanics in the United States primarily through Yahoo! En Español, although it also sees traffic from U.S. Hispanics on its other sites - Yahoo! Argentina, Mexico, and Spain.

The Players Marketers at both AOL and Yahoo! agree that, while things have improved, getting advertisers to rearrange their marketing plans to include a Hispanic component is still a challenge.

Sonora points to companies like Avon and Sears as two that have done a good job awakening to the Hispanic market reality, particularly where women are concerned. Last fall, Sears announced that nearly 100 of its stores would be revamped to appeal more to "multicultural" shoppers. That included the addition of new apparel brands with more crossover appeal, as well as dedicated signage in markets known to have larger Hispanic populations.

Sonora says the signage issue is a big deal; she expects to see more bilingual point-of-purchase displays in the future. "Hispanic families shop as a unit," she says. "You have to make sure grandmother can read [the signage] as well as the teen daughter."

But quickie translations may not always cut it, Sonora cautions. "Retailers have to take the tiny bit of extra effort to use regional terms and know cultural differences," she says, using the example of the word "truck." West of the Mississippi, it's troca; east of the Mississippi, it's camion. Marketers overlook such linguistic subtleties at their own peril and also risk alienating shoppers if they're not sensitive to these realities.

Outlook Liz Sarachek, executive director of sales at Yahoo! En Español, projects anywhere from 25 percent to 50 percent growth in ad spending by marketers targeting the diverse Hispanic marketplace; she estimates 10 percent to 20 percent annual growth for Hispanics online. Sonora expects to see more companies "doing their homework" to appeal to Hispanics and Hispanic women, in particular.