Why would 57%+ of top advertisers spend less than 1% of their advertising budgets targeting Latinos when there are clear facts that show it is the fastest growing and more attractive market in recent US history worth $1.3 trillion in spending power ?. I couldn’t believe this stat but according to a new study by the AHAA (Association of Hispanic Advertising Agencies) this is the case.
I have an opinion on this topic based on years of experience working in marketing organizations both in Latino and general market roles. There some key forces at play that are causing many companies to miss out on this huge Latino market opportunity:
-Misconceptions and confusion about the Latino market, its segments, its influence on the mainstream and the best way to target them.
-Lack of understanding and confidence in success models on how to win with Latinos. In the absence of a success model many advertisers are opting to tweak their general market marketing into a total market approach to win with Latinos and the general market with the same marketing spend. Sometimes the total market approach is the best approach but sometimes it is not the right approach or it is not executed well.
-Not having an influential champion in their organization or at their agencies with the right Latino/multicultural expertise, experience and power to lead an initiative to make the case for targeting Latinos.
-And the big elephant in the room: The dynamics of budget allocation, power and decision making in organizations. At most top advertisers the general market is still the primary focus, and the leaders of these companies which control the budgets have mostly built their expertise and track record in the general market. The perceived risk of betting big and failing on a market that might be unfamiliar and which they don’t master is big. Pushing for a shift to focus on the Latino market also poses a big question to organizations: whether a Latino/multicultural specific strategy is the best success model for the future. The ad spending would suggest that as of now many of these companies are not convinced that is the case.
Check out this great article by Food-Navigator-USA that lays out these surprising stats: