All posts by Jose Villa

About Jose Villa

I’m the founder and President of Sensis, a cross-cultural advertising agency with digital at its core. I launched Sensis as a Web development firm in 1998 and one of the first agencies focusing on the Hispanic digital market. Our agency has since grown into a unique full-service ad agency – that takes a digitally-infused cross-cultural approach to the general market. I am passionate about cross-cultural marketing and always trying to push the envelope of multicultural advertising. I write regularly for MediaPost, AdAge, HispanicAd.com, and here! I also speak at a lot of advertising conferences like SXSW, Hispanic Retail 360, Hispanicize, and AHAA.

The Debate over “Total Market” and Multicultural Marketing

March 23, 2017

Posted by Jose Villa

Last month, a debate broke out online between Jeffrey Bowman of Reframe: The Brand and the Association of Hispanic Advertising Agencies (AHAA) over the relevance of total market vs. multicultural marketing. After posting an article entitled “Close the gap: The state of ‘total market’ industry”, AHAA responded with a pointed rebuttal in the comments. Bowman is the founder and principal of a marketing consultancy that grew from an eponymous association he founded for marketers interested in the emerging “Total Market Approach.” AHAA is a Hispanic marketing association made up of Hispanic ad agencies, media companies, and marketing service providers focused on the U.S. Hispanic market.

Bowman’s article makes the argument that multicultural marketing, which he describes as “separate but equal marketing,” is inefficient and ineffective. AHAA argues that multicultural advertising is highly effective, making a broad case for the importance and value of specialists in developing advertising that generates increased ROI.

This argument is important and one the marketing industry needs to have. I am glad Bowman made his case and AHAA stepped up to provide a counterpoint. For the last five years, the industry has argued these issues mostly at conferences and in private. The future of marketing in the U.S. – and potentially globally – will be affected by how we answer these questions.

While I agree with many of the points made by Bowman and AHAA, I think both sides are missing the fundamental issues.

I agree with Bowman on three key points in his Total Market argument:

  1. The advertising industry needs to create new models to serve brands as demographics drastically change.
  2. Companies, particularly ad agencies, need to create new value for the brands they support.
  3. Brands need to realize their internal decision-makers and employees (who are disproportionately Gen Xers and Boomers) are one to two generations removed from core consumer they are trying to attract, mostly Millennials and Generation Z.

However, Bowman’s arguments are flawed in several ways. He fundamentally misrepresents multicultural marketing as “separate but equal” failing to understand that historically most multicultural marketing programs have been under-funded receiving only a fraction of the resources devoted to the “general market.” He also misunderstands the nature of the pushback against the Total Market Approach. It has not been all agencies, but mainly multicultural ad agencies and ethnic / in-language media companies who have the most to lose from consolidation resulting from Total Market strategies. Bowman fails to articulate an alternative to multicultural marketing, and does not make much of a case for why a Total Market approach is better.

AHAA also makes some valid points in their rebuttal. Their argument that segmentation is an important and valuable marketing strategy is accurate. They also reference studies showing the value and ROI generated by multicultural marketing programs. However, AHAA and the multicultural marketing industry need to move on from flawed positions that were articulated in the AHAA rebuttal:

  1. Acculturation-based segmentation is losing relevancy for most ethnic populations in this country as they are increasingly native born.
  2. The focus on Spanish-language media is hurting the industry, as it also becomes less and less relevant to younger multicultural audiences that consume most of their media in English.

The multicultural marketing industry needs to move on from simplistic arguments regarding the value of specialists and be leaders who introduce new models for cultural marketing. If Total Market is not the right approach, and multicultural is increasingly irrelevant, the multicultural “specialists” are the best positioned to introduce innovative models.

An edited version of this post was published on MediaPost Engage:Hispanic on March 23, 2017.

A Critical Moment for Hispanic Advertising

March 2, 2017

Posted by Jose Villa

This year’s Super Bowl ads brought to light the role advertising plays in our cultural discourse. As I discussed in a recent NPR interview on the controversy over Super Bowl ads from Budweiser and 84 Lumber, advertising is both a reflection of our culture and an influencer on the culture.

I am most concerned with advertising’s influence during this incredibly politically polarized time in our country’s history. We as advertisers have an important responsibility to influence the culture, particularly as it relates to Hispanics and how the general population views them.

Many people in this country are justifiably concerned about illegal immigration and the negative impact of low-skilled immigrant workers and cross-border trade with Mexico on jobs. Unfortunately, this concern is widening a chasm in our country and fueling negative views of Hispanics. My intention is not to criticize those who feel this way about Hispanics. Instead, it’s a call to my fellow Hispanic marketers to take a step back, take the high road, and use this moment to answer a higher call to serve our community and country. We have an opportunity, together with the media and news organizations to shape the narrative, and influence the culture in positive ways.

How do we do this? To start, we must make sure that we represent Hispanics in the most authentic and way possible, avoiding stereotypes feeding the misconceptions at the heart of the political discourse. This is particularly important in mainstream, or so-called “Total Market” advertising featuring Hispanics. We need to show positive representations of Hispanics in ads. Not as gardeners, day laborers, or maids. We also have a responsibility to show the contribution Hispanics – particularly immigrant Hispanics – are making to this country. The businesses they are starting, the jobs they are creating, the families they are raising, the products and services they are consuming.

Secondly, we must have a difficult and honest dialogue about assimilation, language and diversity. Few people have been pushing the importance of diversity more than me. I think we’ve pushed diversity and multiculturalism too far. Part of what is underlying the anti-immigrant rhetoric and nationalist sentiment in this country is that we, as advertisers and the media, have pushed and promoted our differences too much. This is ironically what underpins the traditional ethnic-specific multicultural marketing of the last 30 years. We have focused on and promoted – either knowingly or not – the fact that many Hispanics are not acculturated (aka assimilated), that they prefer to speak Spanish. Unfortunately, this has created sentiment among non-Hispanics that Hispanic immigrants are not becoming Americans. Nothing can be further from the truth. However, we as advertisers play an important role in this and need to think about the narratives we are generating.

Advertising is a consequential endeavor. We as advertisers and marketers have a powerful opportunity and responsibility to influence culture.

An edited version of this article original ran on MediaPost Engage:Hispanic on February 23, 2017.

Effective Hispanic Advertising that Drives Behavior Change

September 28, 2016

Posted by Jose Villa

Most marketers view their role as driving demand, either via upper funnel branding and awareness activities or lower funnel direct response, sales and retention activities. Advertising is generally viewed as one of the primary tools to drive consumer demand. But what is at the core of driving consumer demand? Changing consumer behavior. That behavior change could involve new product trial, increasing occasion, acquiring market share by driving preference change, or increasing retention. To quote Adam Ferrier from his influential book The Advertising Effect, “Advertising is really the business of behavior change.”

The growth and interest in behavioral economics, as popularized by books like Nudge and Thinking Fast and Slow has brought a great deal of attention to the irrational ways people behave and the art and science behind how to influence that behavior. Building upon Ferrier’s analysis of psychological and behavioral science research, there are nine action spurs, or triggers, that can be used in advertising to change consumer behavior. (See figure below.)

BehaviorChangeTriggers_Sensis

Many of these behavior change triggers are not new, and have been in use since the Mad Men era of advertising. They include using endorsements and modeling (follow) and emotion and evocation (feel) in ads to change consumer behavior and drive demand. Similarly, some have been used in Hispanic advertising, but without a deliberate focus on behavior change, or leveraging all nine triggers. This is a major missed opportunity.

The Hispanic consumer market is typically seen as an emerging market for many brands and industries. This is particularly the case for laggard industries like pharma, electronics, and financial services that have made limited investments and little inroads with Hispanics. Most Hispanics are unfamiliar with or do not use their products. Additionally, many brands target recent Hispanic immigrants who are essentially new consumers with no brand preference. This is because immigrants may not be able access trusted brands from their home countries in the U.S. or are looking to assimilate via new adoption of U.S. brands. This is commonly the case with beer.

For these laggard categories and those targeting recent immigrants, Hispanic marketing is primarily about generating significant behavior change, in the form of:

  • Introducing new categories and associated products (e.g. pharma, financial services)
  • Driving trial with new brands/products/services (e.g. beer, wireless, CPG)

For these Hispanic marketing efforts to be effective, it is critical that communications not only effectively change behavior, but also be culturally relevant. Cultural relevance is achieved by identifying Hispanic consumer insights and creating content and messages that relate to Hispanic consumer beliefs, customs, ways of thinking, behaving and/or working.

Therefore, the triggers used to effectively change Hispanic consumer behavior must be used in culturally relevant ways. As an example, if the “play” trigger is used to make a desired behavior more enjoyable by incorporating gamification or play principles, it must be done in a culturally relevant way. This means using game formats that are popular and well understood in relevant Hispanic home countries, such as loteria and “veo veo”, or leveraging multiplayer formats where Hispanic gamers over index. Marketers have a significant opportunity to grow in the Hispanic market by employing smarter marketing strategies that use culture to change Hispanic consumer behavior.

An edited version of this post originally ran on MediaPost Engage:Hispanic on September 23, 2016.

The Obsolete Hispanic Ad Agency

Posted by Jose Villa

A MediaPost op-ed by Luciana Gomez ignited a conversation within the Hispanic marketing industry regarding the relevance of Hispanic ad agencies. Gomez’s piece opined that Hispanic agencies are experiencing stunted growth for a number of reasons. They are underpaying talent, have low client budgets, they need to work within pre-existing “general market” campaign structures, have an over-emphasis on Spanish TV, and stale insights. These agencies only have control of three of these issues.

This article prompted a number of responses, including one from Lee Vann positing that Hispanic agencies aren’t fading, and that many are succeeding. It’s good for the industry to have these conversations and not stick its head in the sand.

I agree with Gomez’s premise that Hispanic agencies are fading. I wrote in December, the Hispanic ad agency business is at best mature with few prospects for growth. I wouldn’t, in good conscious, advise anyone to start a Hispanic ad agency in 2016. Contrary to Vann’s position, the only Hispanic agencies doing well are the top seven specialist Hispanic agencies I referred to in my article – many of which are being fed Hispanic work by their large general market sister / parent networks (example Casanova becoming Casanova/McCann). The large, independent Hispanic ad agency is a thing of the past.

While I agree with Gomez and disagree with Vann, I think everyone is missing the bigger picture of what’s going on within the broader Hispanic marketing industry. They are focusing on stagnating Hispanic ad agency business and missing the bigger, structural shift.

Hispanic marketing is moving out of the silos and Hispanic insights, market knowledge and strategies are being mainstreamed.

This is a seismic shift that is happening for two fundamental reasons:

  1. The Hispanic market has gotten too big and lucrative to be a niche opportunity.
  2. The Hispanic population is assimilating and creating a new mainstream, something that has happened numerous times in our past when there have been large migrations into this country.

This means that the specialized Hispanic ad agency business model that blossomed in the 1980s through early 2000s is no longer relevant to these new market conditions. It doesn’t represent the reality of the Hispanic experience in the U.S. in 2016. Marketers are realizing this – much faster than ad agencies – have started to embrace new cultural marketing models like “total market” during the last four years.

The question remains: What new business model will replace the obsolete Hispanic ad agency? I don’t know for sure, but I see a transition occurring within both the ad agency and marketing function of brands:

  • Hispanic advertising capabilities will be integrated into mainstream ad agency functions to create a new kind of general market agency
  • New models for culture marketing will emerge embracing cultural realities and cross over
  • An evolution of total market placing proper emphasis and focus on Hispanic consumers – understanding and leveraging how they are changing and influencing a new mainstream and placing more acculturated Hispanics into the proper perspective
  • More focus on culturally relevant content creation over Spanish-language targeted media buys

I believe new agency and marketing models are inevitable. The Hispanic ad agency and Hispanic marketing as we’ve known it have had a great run of more than 30 years.

An edited version of this post originally ran on MediaPost Engage:Hispanic on August 25, 2016.

Content [Marketing] Is King in Reaching Hispanic Millennials

July 28, 2016

Posted by Jose Villa

You know Hispanic Millennials – Hispanics aged approximately 21-37 – are a critical, coveted segment of the U.S. Hispanic market. They are comprised of the two most historically attractive consumer segments of 18-24 and 25-34 year olds. They represent more than 27% of the entire Hispanic population and are growing – mainly due to immigration. Compare that to Gen X and Baby Boomer Hispanics, who represent a combined 33% of the U.S. Hispanic population but are shrinking as they age. If you’re focused on the Hispanic market in 2016, you are essentially focused on Hispanic Millennials.

However, most marketing to Hispanic Millennials fails because it is focused on what I call the three pillars of irrelevance:

  • Traditional, in-language advertising – mostly on Spanish-language media
  • Paid, interruptive advertising
  • Episodic campaigns usually around major “seasons” or events (e.g. the World Cup)

This conventional approach to Hispanic Millennial marketing often focuses on in-language creative running on in-language media (think 30-second radio spots running on Spanish radio).

This approach is irrelevant to Hispanic Millennials because of their unique behavior. According to the latest wave of research from the Hispanic Millennial Project (HMP), Hispanic Millennials are consuming content on ad-free platforms like Netflix as much or more than they are via broadcast/cable TV. They are increasingly time-shifting their content consumption, via DVRs and on-demand platforms, skipping unwanted ads. A recent eMarketer report showed that nearly two in three Millennials block ads and a solid majority of Internet users age 18-34 block ads when viewing digital content. Language is also playing less of a role in the media Hispanic Millennials consume. According to the Hispanic Millennial Project, only 46% of Hispanic Millennials indicated any Spanish language streaming activity. Furthermore, the social media behavior of Hispanic Millennials shows us they are “always on.”

Hispanic Millennial marketers should take a page from the B2B marketing playbook. Much like Hispanic Millennials, B2B decision-makers are elusive targets that can’t be cost-effectively reached with broadcast media, and they don’t respond well to intermittent interruptive advertising. B2B marketing has become a highly specialized and effective field of advertising focused on targeted content marketing.

The best definition of content marketing is:

The creation and distribution of useful and valuable content that consumers choose that leads to demand for a product or service

This content must be so useful and/or valuable that consumers seek it out. They are not forced or deceived into consuming it. They genuinely want to consume the content – whether it’s listening to an audio clip, watching a video, answering a poll, taking a quiz or reading the latest list of the “Top (pick a number or topic).” The content must also directly and measurably lead consumers to consider purchasing a product or service. It must positively impact demand.

Effective Hispanic Millennial content marketing requires a shift in mindset from advertising to publishing. Brands and their agency partners need to embrace a digital studio model of creating high-volume, cost-efficient, digital multicultural content. This means establishing the capability to create content in more compressed cycles (think days versus months) at a fraction of the cost of broadcast quality video content (e.g. 30-second TV spots). In the past, creating and distributing your own Hispanic-focused content was cost prohibitive and risky. Digital technology and tools like HD video and content distribution services have changed the game. Additionally, there is now a digital ecosystem in place to support Hispanic millennial content marketing.

In addition to embracing a digital content studio model, consider these key principles to an effective Hispanic Millennial content marketing program:

  • Multi-platform approach – Moving beyond a website or Facebook page
  • Organic drives paid – the most effective ads bubble up from the best performing digital content
  • Foster co-creation – Focus on content co-creation vs. ownership

An edited version of this post ran on MediaPost Engage:Hispanic on July 28, 2016.