I have been mulling this word in my mind for a few years now, okay, maybe a decade or so. It’s a term I will claim because I don't think I have seen others use it in the Hispanic marketing discipline. If you Google it you will only find a link to an organization in Vienna or Mexico. That’s "nada que ver" (nothing to do) with my world. What do I mean by Latinomics?
Latinomics are the economics of Latino marketing.
What's interesting about the economics of Hispanic marketing is the fact that we deal a lot with "diseconomies of scale." What I mean by this is that because budgets are smaller, the larger economics of general marketing communications don't always apply as there is less scalability. These diseconomies exist regardless of discipline.
For example, say there are two media planners, Peter, the general market media planner, and Pedro, the Hispanic media planner. They both work on the same brand and at the same agency. One is responsible for Hispanic media planning while the other is responsible for general market media planning. To keep things simple, let’s leave this at a network planning level and assume the budgets are comparative. Peter's budget is 15MM and, on a good day, Pedro's is 2.5MM (we’ll be a little optimistic here).
They both have the same salary and, for argument’s sake, they are 100% dedicated to the same business. When you look at your resource cost to plan Hispanic media vs. general market media, Hispanic media planning costs will be less efficient because it will take the same amount of cost to develop and deploy a Hispanic media plan with a smaller budget.
Analogous situations happen across the Hispanic marketing communications spectrum, shopper marketing, events, social media, consumer promotions, CRM, etc. Budgets are smaller, and it costs Pedro just as much as Peter to get on a plane to meet with the client, yet, unfortunately, Pedro comes back with a much smaller Hispanic budget.
In addition, there are some other complexities: smaller talent pools in the industry, smaller media ecosystems (fewer options and less fragmentation), reduced revenue opportunities, smaller client organizations to service Hispanic marketing and more. Though there are fewer options and smaller revenue, there are proportionately higher fixed costs. Now, for most folks who are in the business, this should not come as a surprise, you are not breaking new ground here, Roberto. To me, the question is how do you move the ball forward or make progress within this economic construct? And, although I may not have the answers to all questions, here are three things I have found that are helpful to deal with Latinomics:
Flexible agency teams: As part of a much, much larger organization, we have learned how to develop more flexible team structures that can incorporate Hispanic resources or, as I like to say, "maña" (know-how) into the key phases of the planning or deployment process to leverage existing infrastructure. There are no easy choices, only wise decisions, so be wise where and when you want to infuse Hispanic expertise to maximize your resource return.
Cross-training: By infusing Hispanic expertise into the marketing communications process and having a Latino seat at the table (during key touch points) you will soon see Peter learning from Pedro and Pedro learning from Peter. Peter and Pedro will plan, collaborate and work faster and more efficiently, perhaps even relieving each other’s workload.
Leverage Big Data: Unlike five years ago, the plethora of Hispanic data available today allows us to be much more precise in our targeting across different channels. Want to target Latinos who have the Univision app on their cell phone? It can be done. Want to target Latinos who buy Snickers at Walmart? It can be done. Want to target Hispanics who use the Cartwheel app? It can be done. This allows more precise and economic deployment of your working dollars.
While Latinomics is a challenge we all face, if we align our resources appropriately and leverage data, we can stretch our resources further and deliver more effective marketing programs.