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Direct Response Marketing

Success Knows No Boundaries

5 Feb, 2010 By: Nicole Urso Response

A rising star turns heads in the U.S. Hispanic market, while Latin America continues to embrace American DRTV products.


 

A Grand Opening
According to Nielsen’s November 2009 sweeps, Estrella TV’s flagship station KRCA ranked as the No. 2 broadcaster in Los Angeles. Estrella TV also received high approval ratings from key demographics during weeknights when programs like “Tengo Talento, Mucho Talento” competed against popular telenovelas.

Alex Agurcia, president of Miami-based Omni Direct Inc., a Hispanic-focused DR agency, took notice of the burgeoning network. He ran a long-form campaign for Sobre de Oro, a gold buying service, and has another campaign in the works for Xpress Redi-Set-Go, a housewares product from Gaiam.

“Estrella TV has become an important medium in terms of our media mix,” says Agurcia. “It’s a little too soon to tell how it will eventually shake out against the top two, but we’re watching closely and we are definitely in there with them as they continue to grow.”

Estrella TV does not have the coverage of its competitors (currently it is at about 69.5 percent) but it plans to add three to four new markets per quarter. During this growth period, marketers can take advantage of competitive pricing.

“The increased availability of local paid programming is very appealing to us,” says Agurcia. “As a DR marketer, we’re excited to have an alternative to Univision and Telemundo where DR avails have become limited and not as cost effective.”

The Evolution of Mainstream
While 2009 ad budgets shrank into obscurity, Spanish-language cable TV had the highest increase in ad spending, according to a December 2009 report by Nielsen. It was up by 36.7 percent and was one of only three categories (including all print, online and television media) to post growth. The second-highest increase in ad spending was on general market cable TV (up 9.1 percent), followed by free-standing inserts (up 11.2 percent).

“The total purchasing power and the growth in net worth per household has increased significantly year-over-year compared to the rates of the average U.S. household,” says Agurcia. “If you are launching a major marketing campaign and have not considered the Hispanic market as part of your strategy, you’re basically leaving a good chunk of money and opportunity on the table.”

Today, Hispanics represent 15 percent of the total U.S. population, and this demographic is growing much faster than any other. By 2050, it will likely increase to 30 percent, according to the U.S. Census Bureau.

U.S. Hispanic audiences continue to blend into the mainstream. In November 2009, 12.8 million Hispanic and non-Hispanic viewers tuned in to watch the 10th Annual Latin Grammy Awards televised on Univision, which broke audience records for the network. The broadcast beat CBS, NBC, FOX and the CW that night for viewers between the ages of 18 to 34, according to Nielsen.

In 2007, Nielsen switched from two rating systems (one for English TV and one for Spanish TV) to one. Now all shows are measured equally, apples to apples — or “America’s Got Talent” to “Tengo Talento, Mucho Talento.”

From media buying to fulfillment, selling products to a Hispanic audience requires sensitivity to cultural nuance. However, considering that the U.S. Hispanic population is roughly 80 percent Mexican, it is by all accounts a mass market. DR agencies with experience in both the general market and the Hispanic market can save advertisers time and money by conducting small media tests before further investments or acute audience segmentation needs to be made.

Robin Behar, partner at In Clover Marketing, an Agoura Hills, Calif.-based agency with expertise in U.S. Hispanic and Latin American marketing, creates both English- and Spanish-language DR campaigns.

“If you’ve got a mass-market offer — a kitchen product, an exercise product, a beauty product — something that supersedes cultural boundaries or language boundaries, I think you must at least consider a test in the Spanish market because the infrastructure is there now,” says Behar. “It really wasn’t the case six or seven years ago.”

In Clover Marketing recently created two distinct campaigns for Herbalife, a nutrition and weight-loss nutraceuticals company. Due to the down economy, its home-party selling business became increasingly popular, particularly among Hispanic women trying to earn additional family income.

Herbalife wanted to recruit new people to host more at-home selling parties and used DRTV ads in English and Spanish. Although the ads addressed different audiences, aired on different networks and were supported by different customer service agents, “essentially you’re selling the same product,” says Behar.

“It’s like the English-language market,” she adds. “We would segment based more on demographic and lifestyle than we would necessarily on cultural demographics.”

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