“Blue Ocean” Strategy for Hispanic Marketing Competitive Advantage
To continue my rant regarding the paltry 5% of Hispanic ad spend that went to digital media reported in the 2010 AdAge Hispanic Fact Pact, I started thinking about the positive potential of this statistic.
Think about this way – no one will argue that the Hispanic consumer isn’t important (there are $6 billion reasons why they are important, ask Univision and Telemundo)
However, is it me, or is there a “Blue Ocean” strategy staring Hispanic marketers in the face?
If you haven’t read Kim and Mauborgne’s popular book “Blue Ocean Strategy,” they posit that tomorrow’s leading companies will succeed not by battling competitors head-on in bloody battles that result in “red ocean” of shrinking profits, but by instead creating “blue oceans” of uncontested market space ripe for growth.
Looking back at the 2009 Hispanic media figures presented in the 2010 Hispanic Fact Pack, $4.3 billion was spent on Hispanic TV (network, spot and cable), representing almost 70% of all media spent reaching Hispanics. That sure looks like a “bloody ‘red ocean’” if I’ve ever seen one.
I understand why TV still gets the lions share of media spend – they pull huge viewership numbers. But TV doesn’t command 70% of Hispanic consumer media consumption. In fact, according to a 2008 Terra/ComScore report, the average Hispanic 12 years or older spent more time online than watching television. This disequilibrium of media demand is also likely driving Hispanic TV media prices (CPMs) higher than they should be.
So it would seem to me that a clear “Blue Ocean” opportunity exists for savvy Hispanic marketers that don’t want to fight in the crowded and “bloody” medium of Hispanic TV.
Instead, they could invest heavily targeting Hispanics online. Imagine a Hispanic marketer investing 50% of their Hispanic ad dollars online? They wouldn’t have much competition, and it’s clear Hispanics are spending as much time there as on TV… who’s ready to sail?
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Jose,
I think you point is well taken. The only issue I have with it is that if an average client spends 50% of their traditional media dollars online, then they would realize that to purchase massive online weight only requires 20% of half of the total budget. So wouldn’t it be better to say “Imagine a Hispanic marketer investing 20-25% of their Hispanic ad dollars online?”. That alone would be incredible!
Hi Jose. The thing which is to be commended is that you are looking outside of the way the industry currently does business — which oftentimes leads to fresh insights such as what you have written about here. For further Blue Ocean Strategy information, you might like to explore http://blueoceanstrategy.typepad.com/ . All blue oceans ahead!