If you haven’t read it, give it a once over (it’s re-posted at the end of this blog)

As we near the end of 2011 (isn’t that crazy?), it seems like as good a time as any to reflect on whether any of my predictions panned out.

I could make a pretty strong case that predictions #1-#4 were on point. Not seeing much movement on prediction #5 though.

What do you think?

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I made the bold prediction almost a year ago today that Hispanic marketing was in for big changes in 2011. I have to admit I think I will be proven wrong.

I think 2011 will result in even more changes than I boldly forecast last year. In fact, I think by the time 2012 rolls around, we’re barely going to recognize the Hispanic marketing space that has seen tremendous growth (more people, more media companies, and more agencies) but changed very little since 2000. Here are my revised, emboldened predictions for Hispanic marketing in 2011:

Prediction #1 – The death of the Hispanic advertising agency
2010 was most definitely the year of the full-on assault on Hispanic advertising agencies (starting with the Home Depot controversy in April, Crispin Porter’s absorption of Burger King Hispanic in August, and the ANA Multicultural Conference controversy in September). 2011 will no doubt see a continued push by general market agencies into the Hispanic market. Not only will they continue this push by staffing up on Hispanic advertising talent, but also through acquisitions (I have firsthand knowledge of at least a few such acquisitions plans from some big ad agency players). Moreover, marketers, particularly those in “minority-majority” markets such as Los Angeles, will begin to follow El Pollo Loco’s lead and consolidate their Hispanic and General Market advertising accounts. Add in the fact that Hispanic ad agencies have been painfully slow in building digital capabilities (they’ve made a valiant “too little, too late” effort during the last 12-18 months), and the writing is on the wall – the start of a slow death for the Hispanic advertising agency model as we now know it.

Prediction #2 – Hispanic PR officially becomes Hispanic Social Media
2010 was also the year that Hispanic PR agencies took the plunge and fully embraced social media as the future of their industry. The success of the inaugural Hispanic PR & Social Media Conference and the LATISM Latino2 tour highlighted the coming of age of Hispanic social media. Hispanic bloggers and social media influencers are establishing themselves as the key centers of influence in the Hispanic community. This was coupled with the continued decline in Spanish print media (magazines and newspapers), which has started to feel the decline in readership resulting from consumer’s shift online and the recession. Looking ahead at 2011, I see a continued decline in Hispanic print coupled with an equally sharp rise in niche and “long-tail” Hispanic digital publishers (whether they are bloggers, Facebook influencers, or small Websites) – with what were formerly “Hispanic PR” agencies and professionals positioning themselves as the expert guides of this growing and increasingly prominent Hispanic social media space.

Prediction #3 – Digital leap-frogs “Hispanic”
During the boom years of Hispanic digital (2005-2008), the Hispanic digital media market looked a lot like the Hispanic traditional media landscape – a handful of prominent Spanish-language portals / mega-publishers that owned the market (e.g. Batanga.com, Univision.com, Terra.com, and Starmedia.com), surrounded by a lots of smaller upstart ad networks (e.g. Gorilla Nation, HispanoClick, Consorte Media) and a handful of general market publisher extensions into the Hispanic market (e.g. ESPNDeportes.com, CNNEspanol.com, etc.) that got the scraps. During the last 12-18 months, the Hispanic digital media market has fragmented, led by technology such as behavioral targeting, demand side platforms (DSPs) and ad networks with immense scale and reach. While the Univision.com’s and Terra.com’s of the Hispanic digital media market will not be going away anytime soon, their days as “market makers” are numbered. Looking ahead, as Hispanic digital media consumption becomes more social (Facebook) and personal (mobile), and mirrored Spanish Websites /microsites become a relic of the past (recent AOL research and Best Buy’s well chronicled experience shows that Hispanic consumers have come to view Spanish sites as inherently inferior to “main” English language sites), the Hispanic digital marketing space will be unlike anything veteran Hispanic marketers have grown accustomed to seeing in their analog Hispanic world.

Prediction #4 – The multicultural mainstream becomes a reality
Multicultural consumers already make up 35% of the entire U.S. population. Guess what will happen to that percentage when the 2010 Census numbers come out this spring? Welcome to the new “multicultural mainstream” – a new America where close to 40% of the overall population is multicultural (Hispanic, Black, Asian and multi-racial). DMA’s like Los Angeles, Dallas, Houston, Miami, Atlanta, and Washington, DC are already “minority majority” markets (Hispanics, Blacks and Asians combined make up more than 50% of the total population) – expect cities like New York and Chicago to join the list in 2011. This will only put more pressure on advertisers, particularly regional ones, to re-assess how they allocate marketing resources to ethnic groups like Hispanics. My theory is more of the “El Pollo Loco” phenomenon from Prediction #1 – as advertisers consolidate their Hispanic (and other multicultural marketing efforts) with their general market ad agencies.

Prediction #5 – The birth of the Hispanic Youth Market
The last few years have seen a steady increase in dialogue, events and attention among marketers about the Hispanic youth market (Hispanics under the age of 24). The statistics are already mind-boggling:
• In 13 years, 50% of Americans under 18 will be minorities (Source: U.S. Census Bureau)
• 80% are US-born (Source: University of California, San Francisco)

I predict that the 2010 Census figures regarding Hispanic Youth will be the most unexpected… and growing. Yet the Hispanic youth market represents a conundrum for Hispanic marketers – a growing market that increasingly identifies and shows pride in its Hispanic heritage but consumes very little Spanish-language media and sees the world through color-blind lenses. This will be the toughest nut to crack for marketers and advertising professionals of all stripes – general market, Hispanic, digital, direct response, social media and everything in between. Yet I see Hispanic youth as the biggest marketing opportunity to come out of 2011.

Think of 2011 as the year of creative destruction in Hispanic marketing – some things will die, a lot will change, and brand new opportunities will sprout from the ashes.

Obviously this is a philosophy I have embraced for years, so it’s nice to hear a smart colleague join the growing chorus of voices calling for a sea change in how Hispanic advertising is executed.

While I support David’s thesis, implementing it in practice opens up a whole can of worms that need to be thought through. Among them are:
– If Hispanic advertising moves beyond language, how does that further complicate the dynamic between Hispanic ad agencies and their increasingly antagonistic general market pals?
– Even if agencies started pushing this philosophy (as we have at Sensis), it doesn’t mean that clients are going to buy-in (as we have experienced)
– If Spanish language advertising is wrong, how do we reconcile that with the huge ratings of the Spanish-language broadcast and radio?

One interesting question I’ve thought a lot about is whether this type of philosophy, if implemented, would evolve Hispanic advertising to look a lot more like African American advertising?

Lot’s to think about and much change to come…

The advertisers were many of the usual suspects you would expect to see during a big sporting event – beer companies, automakers and big consumer goods companies.

The spots were generally great – effective, culturally relevant and entertaining. Many of them were developed specifically for the Copa de Oro tournament, or at least soccer themed. So they were even contextually relevant, something rarely seen in TV spots outside of the Super Bowl.

What struck me the most, however, was how heavily they played on and integrated “digital” themes. Most of the ads incorporated elements of the digital lifestyle in their concepts. The ads take for granted that digital media is a big part of the U.S. Hispanic reality, whether it was people using the Internet, connecting on Facebook, or using their smartphones. I would assume the account planners at the agencies that created the spots were looking at the same data we see all the time in writing their creative briefs – the data on Hispanic digital media behavior throughout all the trades showing that Hispanics are heavy users of all kinds of digital media.

Watching all these “digitally” themed Spanish language TV ads reminded me of the 2010 AdAge Hispanic FactPack. I wrote a blog post a year ago about how the annual report on Hispanic advertising was full of ads emphasizing digital media – whether by the Hispanic ad agencies or Hispanic media companies. However, the irony of the Fact Pack was it had statistics showing that only 4.8 percent of all Hispanic media spend went to online media.

Obviously the folks planning and developing all this traditional creative felt digital was an important theme to incorporate into their ad concepts. Yet the overwhelming majority of Hispanic media dollars continue to go to traditional media – 95.2 percent to be exact. That is the irony and contradiction.

A cynical view would be that the key parties involved – i.e. the Hispanic ad agencies and the big Hispanic media companies – have a huge incentive to keep most Hispanic advertising programs going to traditional media, specifically TV. The costs per thousand are much higher for the media companies and the production budgets are many magnitudes larger than they would be for digital ads. Moreover, for most Hispanic ad agencies, big TV productions are still their cash cows, and one they are not interested in “putting to pasture.” Add in the fact that many Hispanic ad agencies still outsource digital creative concept development and production, and it’s clear going “too digital” would hurt their bottom lines.

A less cynical assessment would be that Spanish TV delivers larger U.S. Hispanic audiences, at scale, and without overlap with the general market, than any other medium. Therefore, it makes sense for the bulk of Hispanic media and production budgets to be allocated to this more expensive channel.

However, it’s clear there is some major inefficiency in how most Hispanic advertising is being executed and allocated by channel. Depending on your view of the situation, there is clearly a market opportunity for fresh thinking on the Hispanic ad agency side or for new business models in the media business.

(an edited version of this article originally ran on MediaPost’s Engage Hispanic blog on 7/7/2011)

Doesn’t it seem like all the articles, conference presentations, and news around the Hispanic market focus on tactics and the status quo these days (and for that matter the last 5 years)?

It seems like the 2010 Census figures have only added to this trend, with an unending stream of articles and webinars rehashing variations of the “wow, Hispanics now total 50 million – that’s a lot… pay attention” script. No in-depth analysis – no critical interpretation of what companies should be doing.

I’m very disappointed, because when I first got into this business 13 years ago, the industry was vibrant and the dialogue was thought-provoking.

I know there are a lot of very smart people still working in Hispanic marketing. I am even more confident that there is a new generation of professionals working in Hispanic advertising that have great ideas and are more than ready to question the status quo.

Let’s elevate the discussion. Let’s question paradigms. Let’s look at the Hispanic market with a fresh perspective and throw out all the assumptions. Let’s imagine the possibilities that technology and population growth can create for a new Hispanic market – one that possibly looks nothing like the one we’ve seen the last 20 years.

And may I suggest if you’re reading this and have big ideas – start a blog. Let me know (so I can link to you) and let’s upend this industry in a good way!

Let me clear the air.

First, I was not criticizing the “Digital Divas” event, belittling the panelists, or in any way questioning the quality of the event.

Second, I was not writing an article summarizing the particulars of the event, as a reporter in a newspaper would, nor leading anyone into thinking that I attended the event. I am not a journalist nor have I ever attempted to present myself as one. I simply provide my opinions and musing on the world of multicultural marketing.

The post was an honest expression of my reaction after reading about the well publicized event (which was sponsored by HPRA-NY, and hosted by Porter Novelli – an immaterial fact I omitted from my original post)

The purpose of my post, like everything I write about, is exactly to foster a healthy debate about the issues affecting multicultural marketing and communications. While I did use the word “traditional” in a vague and confusing manner, what I was trying to express is that the panelists represented media companies in the traditional sense – run by editors and hierarchical in their structure. I assumed, wrongly, that a panel entitled “digital divas” would be centered around individual, decentralized Latina social media influencers. The fact that all were involved in online publishing instead of offline publishing was not my point, it was that they were all representing conventional “top-down” publishers.

I did not pass judgment on these “top-down” publishers as somehow irrelevant or inferior (I don’t believe that). I just expressed that my perspective is such that if asked, I would define “digital divas” as independent, decentralized social media influencers and bloggers. That my perspective is different, and that I suspect I might not be alone.

I was hoping to spur a debate about these two models of media – because I know Hispanic PR professionals have some interesting and sometimes conflicting opinions about whether the “groundswell” cadre of Hispanic bloggers and social media influencers are ready to take a seat at the table with the conventional Hispanic publishers and media players.

Now everyone, step away from the ledge and let’s debate…

While there was nothing that jumped out as particularly “earth shattering” and surprising, I found the importance placed on online “window shopping” to be interesting. You have to figure that a lot of that type of activity was related to clothing, electronics, and other “lifestyle” categories, and a lot of that time was likely spent on sites like Amazon.com and BestBuy.com.

Needless to say, some interesting food for thought for a lot of brands in those lifestyle categories, especially after the 2010 Census figures come out. I anticipate some big, surprising numbers on the Hispanic youth market this spring.

The event was billed as the first stop in a multi-city tour of California by LATISM. LATISM bills itself as “the largest organization of Social Media profesionals of Hispanic origin. Our members are bloggers, twitters, social network group leaders, e-commerce owners, marketers and more. ”

If you’re like me, you’ve probably heard of LATISM, and maybe the Latino2 tour, but were not really sure what the group is about?

While I have generally been supportive of LATISM, and agreed to participate in the Latino2 LA event as a panelist, I truly did not know what to expect. In fact, whenever people ask me about LATISM, I have a hard time giving them a succinct description of the group (or “movement” if you prefer).

So I attended the entire conference and tried to take it in, observe the attendees, and “listen in” on conversations as much as possible to try to size-up LATISM.

First, a couple of observations about the event:

– There was a decent sized crowd in attendance (I “ball parked” it at around 150-170 people)

– A lot of the attendees were bloggers and social media power users (i.e. people with 1,000+ Twitter followers, etc.)

– 95% of the attendees were Hispanic.

– More interestingly, I would say the majority of the Hispanic attendees were fully bilingual, probably best described as “partially-acculturated”

– The major and most visible corporate sponsors were large technology companies (e.g. HP)

– Local PR firms had a strong presence at the event

Listening to the conversations and discussions both during the formal program and during networking breaks, I noticed a couple of interesting things:

1. There were countless anecdotes about attendee older family members recently jumping into social media (e.g. stories about Spanish-dominant “abuelitas” and older parents recently signing up for Facebook and “friending” them)

2. More specifically, a lot of these stories had an interesting twist – that using Facebook was the impetus for these older Hispanics to begin to use the Internet in general.

3. A lot of the bloggers in attendance started blogging because they felt a dissatisfaction with mainstream media and content that was irrelevant to them. Simply put, they didn’t identify with most Spanish-language media (“it’s for recent immigrants”) and feel that general market media has failed to connect with them culturally.

In summary, the event was best described as a early-stage version of a Hispanic “BlogWorld.” It’s also clear that there is a large and growing Hispanic social media world (bloggers, twitter users, amateur content producers, etc.), and that a lot of growth is coming from older, less acculturated Hispanics.

It’s also clear that a lot of the most vocal members of the LATISM community are looking to fill gaps they see between the traditional media and social media spectrum.

Sounds a lot like the early days of Spanish TV…

If you’re like me, you’ve probably seen innumerable reports and studies stating that Hispanics are more social.

Most of the data backing up this catchy headline focuses on social media usage. Hispanics are active users of social media platforms, particularly social networks like Facebook, micromedia such as Twitter, and the reading and writing of blogs. Research firms like Forrester have gone further and looked at what type of social media users Hispanics are by understanding where they fit into their well-respected social technographic ladder (“Inactives” vs “Creators”, etc.). Again, the data paints a positive picture that Hispanics over-index the general market in terms of their engagement level. In plain English – there are a lot of Hispanic social media users and they are more active.

All of this quantitative data is sound and the conclusion is pretty straightforward – Hispanics use social media, as much or more than their general market counterparts. That’s great and all, but it doesn’t really help a marketer figure out how to use social media to market to Hispanics.

Why not? Isn’t the data enough to support most brands and companies investing in Hispanic social media?

Unfortunately, the tools aren’t there. Hispanic marketers only have a two-dimensional prism to understand a three-dimensional world. Put another way, all the great data I referenced earlier just confirms that Hispanics are consuming/producing social media, but that isn’t enough information to understand how to engage them in this space Why? Because social media activity cannot be simply filtered as Hispanic unless Hispanics behave differently than non-Hispanics in this environment.

The problem lies in the simple premise at the heart of the multi-billion dollar Hispanic marketing industry – that most Hispanics are culturally and linguistically different from the “general market” and consume different media (i.e. Hispanic media, 90 percent of which is in Spanish). This premise is the reason why two symbiotic sectors exist:
• Hispanic advertising and PR agencies that create culturally and linguistically relevant communications for Hispanic consumers
• Hispanic media that provides Hispanic consumers with linguistically and/or culturally unique content they demand (where Hispanic ad agencies can buy media on and PR firms can “earn” coverage in)

When we talk about reaching Hispanics in social media the aforementioned premise no longer holds true. Specifically, the second part of the premise breaks down – Hispanics are not consuming different media – they are on the same Facebook, Twitter, LinkedIn and other large scale “connected” platforms as everyone else. That is what makes social media so powerful – you can connect 500 million people on the same network, even though they may be in 100 different countries speaking 150 different languages.

The concept of segmenting one ethnic group – either based on language, culture or media consumption – becomes fundamentally more complex when everyone is on the same site, network or platform. You can’t simply cling to differences in the language of media consumption. You can’t look to Facebook “en Español” (ask MySpace how that worked out for them) when the content is no longer asymmetrical – you don’t have a single, centralized content producer (think Univision or SBS) being consumed by large scale masses. The “content-creation-to-content-consumption” continuum is peer-to-peer (with companies/brands mixed in at the same level of peers), so it’s very difficult to depend on only contextual relevance.

What we’re missing is qualitative data about if, and how, Hispanics use social media differently. Do they consume, comment on, or produce social content that is different than the general market?

Language plays a part, but when you are connecting 100s of millions of people on the same platform, there is a lot of cross-language media consumption taking place. More simply, do Hispanics exhibit different behavior on social media? Part of this qualitative question is whether they demand – and therefore consume – different content. But that’s only part of the behavioral equation.

Do they produce different content (e.g. talk about different things)? Do they comment differently (i.e. are they more likely to comment positively than the general market)? Do they exhibit different attitudes towards brands and companies in social media? Do some of the generally excepted models of social media behavior apply “apples-to-apples” to U.S. Hispanic consumers (i.e. does the Hispanic social technographic ladder have different rungs)?

I have anecdotal evidence from client campaigns that they do behave differently, but our industry needs more robust qualitative research and behavioral models to provide the 78 percent of hesitant marketers (according to an Orci report) with the intelligence they need to smartly “go to market” with Hispanics in social media.

Hispanics and e-commerce is a fascinating topic. A topic that has been covered in almost every major research report on Hispanic Internet use since 2000, yet it is rarely given more attention than a small section of a larger white paper or a one-off report from some research firm tangentially involved in the retail space. Why is that?

It’s not because it doesn’t represent a viable market opportunity: U.S. Hispanics (according to the limited research on the topic) spend quite a bit online – $12.8 billion in 2008 with projections to reach $21.6 billion next year (JupiterResearch, 2007). That’s 11 percent of all e-commerce purchases (not too far below Hispanics’ percentage of the U.S. population). I think that Hispanic e-commerce doesn’t get the attention it deserves not because it isn’t a large, growing market, but because it is a complex subject, where the opportunity for retailers is amorphous and not very clearly understood. Furthermore, I would posit that there are not a lot of experts with actual experience in the arena of Hispanic online shopping (at least at the large retailer level). That theory is validated when you scour the Internet for case studies on the subject and find only the well publicized Best Buy and Home Depot cases.

Whenever I start looking at Hispanic e-commerce, four big questions continually come up. We can answer the first three fairly quickly:

1. Do Hispanics buy online?

Yes. The JupiterResearch data I reference above shows that Hispanics represent a vibrant component of the growing e-commerce market. While a significant percentage of Hispanics do not shop online due to various obstacles, it’s clear that English-, Spanish-speaking and bilingual Hispanics shop online in varying degrees.

2. Are Hispanics relevant to most Internet retailers?

Yes, particularly the larger Internet retailers offering broad product mixes. While there are thousands of niche Internet retailers that are completely irrelevant to Hispanics, a quick glance at the Internet Retailer 500 list would show that most of these sites have broad appeal that crosses over to the 50 million+ Hispanic market. ComScore data on Hispanic traffic to retail websites validates this – they reach 74 percent of online Hispanics (16 million).

3. Are Internet retailers already effectively reaching / selling to Hispanics online?

The answers to questions 1 and 2 show that a segment of Hispanics are already being reached by Internet retailers. However, an inverse look at the ComScore data reveals that there are potentially 36 million Hispanics that are not being reached by the top Internet retail Web sites. That’s a big chunk.

4. Are there differences between Hispanic online shoppers and their general market counterparts?

This is the million dollar question. This last question is actually at the core of how retailers should approach the Hispanic e-commerce opportunity.

Most of the focus of the Hispanic e-commerce debate has revolved around the language of the shopping platform and experience. I would posit that the fundamental question and opportunity regarding Hispanic e-commerce lies in understanding Hispanic online behavior.

There is some data out there that supports my theory:
• Hispanics that are comfortable buying online but will typically go to English versions of e-commerce sites (Internet Retailer/Omni Direct, 2010)
• Online Hispanics generally perceive English language Web sites as more comprehensive, detailed and useful than Spanish-language versions (AOL Cheskin Hispanic Cyberstudy, 2010)
• Concerns about providing personal information online (32 percent) and the desire to touch and feel products before making a purchase (30 percent) were the two leading reasons why Hispanic Internet users refrained from buying online (Forrester, 2008)
• Less than 20 percent of visitors to Best Buy’s Spanish Web site toggle back and forth between the English and Spanish sites (Best Buy Survey, 2008)

Maybe translating an online store and offering a mirrored English-Spanish e-commerce environment isn’t the answer? As someone who has been helping clients large and small build Spanish Web sites for 12+ years, I can tell you I’ve never been a big fan of wholesale Spanish translations of Web sites. Not only are Spanish Web site translations expensive and difficult to maintain, they are usually a strategic “cop-out.” Instead of spending the time and effort to understand exactly what online Hispanic consumers are demanding and focus on addressing those needs, you take a “shotgun” approach to just translate everything to Spanish. I’ve rarely seen this approach work.

Let me suggest that the real Hispanic e-commerce opportunity lies in understanding and addressing other aspects of e-commerce:
• Personalization
• Product offering / Product mix
• User experience / Visual design
• Emphasizing product research over product sales

Furthermore, as technology advances, and Hispanics continue to show a propensity towards early adoption of digital technology and devices, mobile commerce and kiosks might represent interesting new “channels” to sell to Hispanics electronically.

Everything he says is right on, but I have a different perspective on this.

Maybe the problem isn’t (just) diminishing Spanish TV viewership, but diminishing TV viewership overall resulting from the collosal shift in media consumption.

Think about it – one of the biggest threats to the traditional TV model of captive consumers are options and personalization.