The future of Hispanic advertising agencies
April 13th, 2010
Posted by Jose Villa
I was interviewed by the folks over at Produ.com last week, and they asked me my thoughts on the Home Depot Hispanic agency controversy. Needless to say, Home Depot’s decision to assign their Hispanic duties to a brand new “Hispanic” division created by their general market agency, The Richards Group, after a full review, brings up a whole slew of issues. However, the question I was asked was whether the Home Depot’s decision was a sign of things to come – a precursor to an eventual undeniable trend towards consolidating Hispanic advertising duties with general market ad agencies.
That’s a big question, and one at the heart of the future of the entire Hispanic marketing (which includes media, public relations, publishing, etc) industry.
My answer was simply that I felt that this trend was temporary. Companies like Home Depot might be compelled to consolidate agencies in the short-run, primarily as a cost-savings move. However, as the economy improves, companies will re-evaluate if
consolidation of Hispanic and general market advertising is providing them the best ROI.
In many ways, this question goes to the heart of how the Hispanic market is viewed by most marketers. It’s viewed as an important, but secondary, market. Almost, dare I say, a luxury. And the marginal additional cost of hiring a Hispanic-specialty ad agency is therefore a luxury expense that companies will not spend during recessions.
The next few years will determine if my thesis is correct. In fact, the Home Depot might provide the best test. Who wants to bet they begin a Hispanic agency review sometime between April 2011 and the end of 2012?
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