We’re halfway into 2017 and the Hispanic marketing industry is in a funk.
Everyone I talk to, from Hispanic agency principals to Spanish-language media executives, keeps telling me the same thing — the rest of the economy may be humming, but spending on Hispanic marketing is stagnant. Some anecdotal indicators I’m hearing this year:
The most common explanation I’m hearing for this slowdown is the political environment, or the “Trump Effect.” While I’ve seen this cause cited, it is more of a theme that captures multiple issues. It includes issues such as increased fear of deportation among Hispanic immigrants and reduced immigration into the U.S. from Mexico and Central America due to the building of the “wall.” These political issues are impacting the sentiment in corporate America around the Hispanic consumer market. Many companies are concerned the market is stagnant. Others might be worried about getting too much unwanted attention by making big investments in the Hispanic market.
While I do not disagree with the existence of this so-called “Trump Effect,” I think there is something deeper happening. I see this shift as “The Total Market Effect.”
I am not the first person to identify the “The Total Market Effect.” It’s the result of a more than five-year-old industry shift embracing the “Total Market Approach” by the U.S. marketing industry. Major brands have moved beyond talking about “Total Market” to implementing the broad tenets of this approach. I have often offered an alternative interpretation of the validity of Total Market approach while the industry has largely embraced a simplified version that integrates all marketing efforts, effectively reducing separate multicultural or Hispanic-only programs.
The shifting demographics in the U.S. Hispanic market have only helped to accelerate the acceptance of the Total Market Approach. According to the latest Geoscape GIS data, 46% of the U.S. Hispanic population is highly acculturated. Half of Hispanics are Millennials and Gen Z. The argument is simple: a young, acculturated Hispanic population is best reached via a Total Market Approach.
As with so many other major changes in the economy, it is the combination of the Trump Effect and the Total Market Effect that is really at the root of the Hispanic marketing slowdown we’re all experiencing. These trends are feeding off each other. Using another analogy, I think this is an over-correction. As with any challenge, this is an opportunity savvy marketers can exploit.