The problem is prioritizing time and limited resources. Executives are so focused on the onslaught of daily tasks, they rarely have time to view the bigger picture and target untapped opportunities or unique niches. One cost-effective way of attaining this edge is to aggressively target a secondary market of which your competitors have barely scratched the surface.
Although most companies have taken notice of the Hispanic community, many do so from a sense of politically correct obligation, and as an item to check off their marketing list. Most companies aren't targeting Hispanics in the right way, providing the smart ones a unique opportunity to gain an edge.
Here are three reasons why companies should invest in Hispanics in the current economic state:
- Size: At 45 million people, the US Hispanic market is greater than the total population of Canada, Spain, and Australia, to name a few. If it were its own country, it would be the 29th largest out of the 232 countries in the world (as noted by Tony Malaghan of Arial International). Why, then, do some large corporations limit their Hispanic outreach to translating a small portion of their Web site and distributing an irrelevant or inappropriate release on Cinco de Mayo?
- Cost-effectiveness: In addition to being a huge, untapped market, the Hispanic community presents a comparatively cost-effective way to gain market share and drive topline growth. Hispanic media has vastly lower rates for advertising on TV, radio, print, and online. More importantly, companies that are interested in testing the waters can do so with cost-effective PR or other below-the-line campaigns, which will resonate even more than above-the-line communications.
- Lack of competition: Despite the fact that Hispanics make up nearly 16% of the total US population, they only comprise 3.3% of the total advertising spend (TNS Report, 2007). This provides a unique opportunity for businesses to introduce themselves to a new consumer segment that is not as bombarded with marketing messages, disgruntled with competitive price wars, or even knowledgeable about many consumer products. According to a recent study, 59% of Hispanics indicate that they “enjoy looking at or listening to” marketing messages, compared with 30% of non-Hispanic whites (Yankelovich's 2007/2008 MONITOR Multicultural Marketing Study).
The Hispanic market often presents a greater opportunity than the general market, in a less competitive environment, at comparatively lower costs. In short, it almost seems like an unfair advantage.
Mike Valdés-Fauli is the MD of the New York office of The Jeffrey Group, which counsels clients on reaching Latin audiences in North and South America. He is also head of its US Hispanic practice.