From Justification To Specialization: The Changing Hispanic Market Conversation
11 Nov 2005|Added Value
Cheskin has worked in the Hispanic market for 20 years, 17 of which seem to have been spent trying to demonstrate that there really is an opportunity for brands and marketers to achieve commercial success within this segment.
And now it seems the momentum that has been building has finally hit critical mass. In the last few years, we have witnessed the Hispanic market rapidly maturing in multiple dimensions. Examples include a proliferation of media serving more diverse niches and a host of new specialized agencies attempting to address everything from specific Hispanic consumer segments (“we are the Hurban agency”) to industries targeting Hispanics (“no one knows Hispanic industrial design for manufacturing better than us”) and boutique specialized services (“if you want a nationally scalable below-the-line Hispanic in-home, pass along marketing piece, we’re here”).
The U.S. Hispanic market has never received more attention from “mainstream” media, the political class or even the corporate sector.
How ironic it is then that at the moment the market seems to have arrived, it is changing in ways that may yet again challenge existing business models, strategies and those who have sought to best position themselves for success.
What do I mean? To illustrate the point, let’s pick just two key trends: The rise of biculturalism and cross-border marketing.
The rise of biculturalism
Much has been written about the ongoing trend from Hispanic dominant to bicultural, and more is continually being written around how this will impact key issues such as the role of Spanish language.
Hispanic market stalwarts who have a vested interest in keeping Spanish as the dominant language of choice for the ever growing Hispanic consumer population are already commissioning research studies to thwart the notion that linguistic preferences may be changing. In contrast, other parties are accepting, if not embracing the notion that English is playing an increasing role in Hispanic consumer lives, particularly for the youth segment. This is no small debate considering this segment is growing at twice the rate of other Hispanic segments (and will for years to come) has more disposable income, influences popular culture more and plays a significant role determining household purchases for themselves and their family.
Is Univision’s vision correct or is Sí TV’s? Or are they both going to continue to have success? Targeting these evolving consumers is sure to yield tremendous benefits, but understanding them, reaching them and deciding how they fit into a broader consumer strategy is again more nuanced than meets the eye. Just when the market thought it was getting the hang of it, the game continues to change.
Cemex/Construmex offers a housing material/technical assistance service in the U.S. to Hispanics building or expanding a home in Mexico. La Curacao and Electra are retailers that now allow Hispanics to purchase hard goods in the U.S. and have them delivered in Mexico. HMOs, banks, and a host of other commercial players are now thinking about service and product offerings that may begin with a consumer in one country and be realized by a consumer in another.
Many complex factors need to be considered to gain success with these kinds of opportunities. Will the large and increasing base of undocumented (and some documented) Hispanics in the U.S. form a viable market for more of these services? How will increasing Hispanic Internet usage facilitate cross-border offerings and communications? In this arena, Spanish language may be a consistent, ongoing critical factor.
Continued regulatory reform, both in the realm of NAFTA enhancements and in affording official status for undocumented Hispanics in the U.S. will help to grow the Hispanic market. Let’s remember here the impact of the matrícula consular I.D., which gave undocumented Hispanics new found official status in the U.S. thus inspiring new financial services product offerings. We are certainly only witnessing the beginning of a much larger trend.
The conversation has truly changed. It is less about “is the Hispanic market a viable one” to “how do we respond for the long haul.” The irony may lie in the fact that as Corporate America addresses this market opportunity it is in turn changing the nature of the market. This could leave some of the long-term players who serve this market at a disadvantage if they are not nimble enough to anticipate this change. Get ready for a rapidly evolving Hispanic eco-system of agencies, media, consultants and the like to enter into a new conversation.
By Stephen Palacios.
Originally published November 2005 in Adweek’s Marketing y Medios.