Tuesday, June 2, 2009

Why Hyundai Should Buy Saturn

So GM is in bankruptcy and it has definitively noted it will be shedding the Saturn brand. Apparently there are up to 16 suitors. I hope one of them is Hyundai.

Hyundai and sister brand, Kia, have long struggled to make a name for themselves in the US market. They have tried to position themselves as the car for the smart buyer - one who understands quality and good value. The problem - consumers don't think that way in spite of all of those consumer reports and meaningless industry accolades. Trusted brands sell cars - sometimes crappy ones. But if your brand doesn't have any real equity or simply holds a terciary role in the mind of consumers - you're sunk.

Despite Hyundai's best efforts, snazzy marketing campaigns and developing some truly spectacular cars which have won countless awards - they still sell fewer cars than many luxury brands without the profit margins to match.

Perhaps it's time to shed the Hyundai brand and help revive a name that actually means something to Americans? The Saturn brand stands for great value, affordable cars for young people who don't want to deal with sleazy car dealers or silly marketing speak. When GM launched Saturn - they asked then agency, Hal Riney, their opionion of the name for their new sedan, the Aura. Hal Riney's response - call the damn thing the Saturn Sedan. Enough with the stupid naming conventions.

This and many other innovations developed a brand with a strong following. While GM has certainly let Saturn slide, Hyundai would be smart to pick this puppy up and truly establish the Koreans as players in the US market.

Wednesday, April 29, 2009

Swine Flu on the Web

I've been monitoring the news coverage on the swine flu outbreak and have noticed signs of panic on the web as chatter touches on a potential pandemic. No one is more concerned than Mexican-Americans - folks that not only are concerned about their health here in the U.S., but also for relatives back in Mexico. MySpace Latino has seen an increase in talk within its forums on the subject and no doubt thatMexico’s national newspaper, La Reforma, and its site, are seeing an increase in traffic as people try to stay abreast of the developments.

This is really scary stuff, but I'm thankful the web provides access to information at our fingertips to stay informed, and dispel myths or clarify misinformation. I think about the early days of HIV and imagine how frightening it must have been to not know what the disease was, how one contracted it and not have any place to find out info.

What an amazing time we live in to be able to share information and track developments in real time. I hope that this sickness is contained and those affected, recover. Certainly, the web will continue to be my destination for the latest and greatest.

Sunday, April 26, 2009

Hispanic Behavioral Targeting

As the Hispanic online audience has grown to over 20 million, so too have the methods for reaching them. The level of sophistication for behavioral targeting increased rapidly over the years.

Today, several networks, including AOL’s Platform-A, have introduced several options for advertisers to reach Hispanics via content type, language and geotargeting. Not to mention, there are ways for these ad networks to get as granular as identifying purchase intent for various categories like auto or finance.

While certainly this is a positive for advertisers who want to avoid wasteful, untargeted investments, what about those who are being targeted? Many of us online go about our business without giving much thought to the recording of our actions online by cookies. Yet, the more one sits to think about the level of data being recorded about our activites, it becomes a bit scary.

On one side of the debate, you could argue that this recorded information will make our lives easier. We'll have an online experience that is more customized, personalized to our interests and needs. On the other side, you could argue that big brother watching over us is nothing short of a police state.

As the law struggles to catch up to the realities of today's technology and the promise of more advanced methods tomorrow, how will the world's governments address the growing concern over consumer privacy?

Thursday, April 23, 2009

iPhone App Gives Apple an Ethical Headache

Apple pulled a controversial iPhone application just two days after the software designer, Sikalosoft, put the app on sale for .99 cents. The problem: the application, "Baby Shaker" gave users the opportunity to shake a gerber-esque baby so harshly as to put a stop to its crying.

This is straight from the promotional materials: "Babies are everywhere you don't want them to be! They're always distracting you from preparing for that big presentation at work with their incessant crying. Before Baby Shaker there was nothing you could do about it."

Apple's decision comes after harsh criticism from several organizations including the Shaken Baby Syndrome Foundation. Certainly, the slack from this will weigh heavily on Apple over the coming weeks.

Apple may have to decide to put limits on its extremely democratized application development software. The ethical dilemma persists, to be free for all or limit the freedom to monitor and control?

Monday, April 20, 2009

Social GPS Convergence

Over the past 2 months, I've been tracking my friend, Heidi, on Google Latitude. We've opted in to see where each of us are at throughout the day via our mobile phone and online. Just the other day I texted her to find out why she was in Southport, CT. (She was outlet shopping.)

Loopt is another service that offers folks the opportunity to see small profiles of friends and strangers alike and connect with them. Imagine spotting an attractive guy/gal within a two block radius and asking them out for coffee? Unlikely? Not really - my roommate did just that. Certainly this is a dangerous technology - you may not want everyone to see where you are at all times.

But I thought, given Hispanics' propensity to socialize - maybe this technology will find huge adoption amongst Latinos? Does that data exist? No. But impromptu connections and a fluid idea of personal space make Latitude and Loopt interesting social enhancers for Hispanics. It will be interesting to see how the use of social GPS application evolves and how multicultural audiences adopt and adapt these technologies in the future.

Immigration Reform Groundswell

Latino chat rooms, forums and blogs have been abuzzing the past two weeks as Hispanics discuss the potential of real immigration reform in the next 12 months. Univision.com's forum on immigration has seen an increase in activity and traffic. While the Obama administration has been coy about their plans, many political watchers thought the issue would come to light following Obama's visit to Mexico last week prior to the Americas summit.

The web has become a critical tool in uniting political activists, community members and other constituents. As Hispanics have mobilized via the web, their strong networks have given them more political capital. It seems that immigration reform is going to be a key issue that Latinos are interested in investing in. The truth of the matter is that while the economy is just as important to Hispanics, there are personal issues being raised with illegal immigration that affects all Hispanics regardless of legal status. Families are being torn apart, racism and anti-Hispanic sentiment is rising and these negative issues all tie back to immigration reform.

African Americans have historically been the most organized minority group in actualizing and wielding their political capital. However, the web is becoming an equalizer for Hispanics who do not have the same extensive grassroot footprint. Hispanics with their size + the web's ability to unite via the groundswell = political power that is being redistributed every day.

Sunday, April 19, 2009

Hispanic Online Banking

Many are surprised to discover that Hispanics participate in online banking. Comscore reports that nearly half (47 percent) of Hispanics looked up bank account balances online. And 12 percent paid their bills online, as opposed to 5 percent of non-Hispanics.

Despite these strong numbers, Latino banking activity still has some growing to do. The challenge: according to Simmons, 52% of Hispanics don't have any bank account at all. On the good side, banks can expect $200 billion in new business over the next few years and Hispanics have the least amount of debt of any ethnicity. However, on the negative side, Hispanics are not fully realizing their financial potential and building their credit history. This impedes their ability to secure better financing on homes and new cars in the future.

Several banks and MasterCard have engaged Latinos for years via financial education campaigns to reduce the number of the unbanked. Prepaid cards have recently been introduced as a stepping stone to building credit history. Similar to prepaid phone cards, a concept that Hispanics are intimately familiar with, is a great way to teach them about the product benefits. However, these efforts have been spotty and certainly have not had the same level of push as other initiatives.

Banks should take note, a financial sleeping giant is starting to wake up. Perhaps more aggressive courting of this key demographic can help pull the industry out of its slump?

Friday, April 17, 2009

Social Media, Pranks & The Law

Over the last few months, I've talked about the power of social media especially amongst multicultural audiences. Social media goes beyond MySpace and Facebook, encompassing any place where groups can commune and share - YouTube, Flikr, etc. But what do companies do when consumers decide to share content they developed around a brand? And what happens if that content is a seemingly innocent prank that is potentially harmful to the brand?

Much has been written about the viral Diet Coke and Mentos experiment. Mentos shined while Diet Coke came down on the creators with a heavy-handed "cease & desist." This was rather harmless and if anything, helped both brands engage their base. In fact, Mentos launched an experiential marketing campaign around the premise and paid the creators to participate.

But today, Domino's is facing a much more daunting challenge. What does it do when two rogue employees upload a video to YouTube of themselves sticking cheese in their nose, waving salami behind their rear and place said items on a subway sandwich? The brand initially was cautious and tried not to feed the media frenzy. But just one day later, the video had been viewed over 1MM times and there was a warrant out for the arrest of the terminated employees. Heavy handed? Perhaps. But, web buzz metrics saw a steep decline in Domino's quality brand image in just one day. These types of precipitous drops are uncommon. Something they built over many years, erased in 24 hours.

The law is unclear on how to proceed. There are clear expectations of free speech on one side, and protection against defamation from the other. Only time will tell if legislators will move quickly enough to address the changing web landscape. One thing is clear, there are no easy answers and a lot of quivering brand managers out there.

Burger King Faces Ethical Dilemma

Burger King is facing an ethical dilemma as they suffer under a firestorm brought on by millions of Mexicans across the globe. The web played a major role in helping to bring to light an ad campaign running in the UK and Spain. The ad and accompanying print work (see above) are for the new Texican Whopper - a fushion of Texas angus beef and Mexican spices, get it?

The advertisements depict Mexicans in a negative light - referring to the barely 5 foot tall, luchador mask wearing Mexican character as "El Cachito" (the little morsel). While the TV spot doesn't include the Mexican flag's eagle, the accompanying print work does. This is concerning as Mexican law strictly forbids its desicration in any way.

Burger King and their agency, Crispin, Porter & Bogusky, are now in an ethical quandary (and business one). Do they continue to push ahead driven by creative freedom or do they respect the desire of millions of Mexicans to have this poor interpretation stricken from the public's view?

Spurred on by the Mexican Ambassador to Spain, Jorge Zermeño, it seems that Burger King is bowing to pressure and is planning to pull the work. It may not be because they see the light, but rather, understand the importance of Mexicans to their business. The US Hispanic market is a lucrative one and Mexico is arguably their second largest after the US. Ethical or not, Burger King understands that not reacting quickly in today's web based world, can really hurt the bottom line.

Monday, April 13, 2009

Spanish-Language as Cultural Relevance?

Many marketers approach their Hispanic marketing like an equation. How many Hispanics are exposed to their message via general market messaging? Then, they discount a specific percentage of spill that is not understood by the target (effective spill). Then they develop complimentary goals in Spanish-language to meet their communication objectives. Lastly, some translate their spot from English to Spanish and others develop original Spanish-language creative.

The problem with this approach is that Hispanic targeting becomes a function of language not of cultural relevance. Sure, those who create original creative targeted to Hispanics in Spanish are getting at the cultural relevance. But what about the Hispanics reached via effective spill? Are they not worthy of targeted, culturally relevant creative in English?

Certainly with limited resources, the lowest hanging fruit is targeting those not appropriately reached via general efforts. Yet, the Hispanic market is rapidly evolving and it's only a matter of time before it shares many traits with the African American market.

Ask any African American marketing agency and they'll tell you the same thing. They have to fight for every penny and explain why simply relying on general market spill is not effective. Clients on the other hand, point to the heavy usage of television and radio (African Americans spend on average 10 more hours with broadcast media per week than non-blacks.) US Born Hispanics spend 13.5 more hours vs. non-Hispanics, so it seems Hispanic agencies will eventual suffer the same level of scrutiny.

Which goes back to the original point - when language is used as a crutch to justify advertising, you forget about a critical and growing segment of the Hispanic market - US Born Hispanics who spend less time consuming media in Spanish.

Sunday, April 12, 2009

Multicultural Gays Online

Since the beginning of the web; lesbians, gays, bisexuals and transgenders (LGBT) have found virtual communities to find support. Sites like Gay Cafe created a place where young and old LGBT's could be themselves and find others like them. Gays of color also found refuge in these chat rooms and later, dating sites.

However, there are few places online that connect or provide resources exclusively for Latino or African American gays. For minorities within the LGBT community, there is an additional stigma to being gay driven by a machismo prevalent in their cultures. This dynamic drives many to live a closeted existence and often makes these groups more susceptible to STDs including HIV.

Thrown in, the LGBT community is also not free of the racism that many Hispanics and African Americans endure. Often, minorities within the gay community find it difficult to connect within a primarily "Abercrombie-obsessed" ideal of beauty. Many Latinos and blacks complain that they are approached by gay white men whose attraction to them could be described as a fetish.

Recently, sites have begun to spring up to address the special concerns of these communities. QV Magazine, an online publication expected to launch in Spring 2009 plans to provide special coverage of issues that impact gay Latino men.

Yet for every QV Magazine, there are still more minority groups within the gay community who do not have a place of their own online. Lesbians of color, African American gay men and trangenders of different ethnic groups still need their own place on the web. With the infinite space available, it's just a matter of time before content is created to address their unique needs.

The New Record Label - You

A group of friends hanging by a river were horsing around when they came up with a song as they were jamming. One of the men in the group pulled out his cell phone and recorded it. Everyone loved it and they forwarded it to eachother as a ringtone. And they forwarded it to friends, and then their friends forwarded it and so on and so on. Within a few months, that song would be uploaded to Youtube and played over a half million times with fans posting their own music videos. The song eventually becomes a Top 10 hit in both the US and Mexico on Billboard's Latin Music List. Sound unlikely?

Well this is real. This scenario happend to an amateur Mexican regional grupero band called Los Picadientes de Caborca (The Caborca teeth-pickers.) This assortment of musical rejects now find themselves on tour and having daily phone interviews with radio DJs while being chased by fans. The best part - they don't have to share any profits from sales of their single, La Cumbia del Rio, with a record company. In fact, record companies are stalking them to get in on the action.

The web's transformative power on the music industry is so prolific that new models of doing business are explored every day. Just two months ago, Cucu Diamantes, a relatively well-known singer and former front woman of a Latin band, Yerba Buena, launched her solo album, Cuculand, exclusively online with the help on iTunes and MySpace. Her video for her single, Mas Fuerte, is now a Top 20 video favorite.

What all this means for Hispanic music lovers is that there will be more options for them and less control on the type of music we gain access to by the music labels. Now our biggest challenge is finding all of this great music, which is a fun problem to have.

Tuesday, April 7, 2009

Multicultural Center of Excellence

During this recession, corporations are likely reevaluating the personnel they appoint to manage their multicultural efforts. Efficiencies influence whether a company designates an internal diversity marketing professional or integrates those duties within the general market. Businesses who value their sales performance should avoid the perils of the latter option.

Employing sophisticated, fully integrated and effective marketing efforts against multicultural consumers requires a center of excellence. A center of excellence (COE) is a person (or team) armed with consumer and cultural insights. The COE understands the benefits that his/her company provides multicultural audiences and can translate those benefits in terms the audience can comprehend. The COE does not translate or adapt general market work exclusively for the sake of integration. He/she does so because that work contains universal truths that transcend culture. And when that work does not translate pan-culturally, the COE makes a case for the development of relevant work. The COE has the power and stature within the organization to influence change. The COE also treats his multicultural agency like a partner and empowers them to do good work; supporting their efforts within his organization. The COE does these things not to stroke his/her own ego, but because it’s right for the business.

Marketers without a multicultural center of excellence will often fail to understand the difference between ethno-centricity/stereotypes and cultural relevance. Bogged down with other priorities, these “integrated” efforts result in a flowchart where diversity is a line item. Creative assets are adapted to minimize resources regardless of whether the creative works or not. Cultural relevance? Who cares, so long as these consumers know the price is $9.99. If creative targeted to these ethnic segments is required by senior management, the marketer responsible for these efforts evaluates the cultural relevance based on the number of stereotypes inserted in a :30 spot. Family with abuelita – check. Sombrero – check. Fast salsa music – check. As for reaching acculturating Hispanics or African Americans – why bother? They are already covered by your general market plans. Who cares if you can customize these efforts to be more persuasive? As for multicultural agencies - they are just annoying vendors. Life would be easier if you only had to work with one agency, right?

No doubt there are companies who hire dedicated multicultural marketing professionals who do bad work. They hired the wrong person. And I’m sure that there are companies out there who do good work without a center of excellence. They got lucky! But by and large, I continue to believe that companies who invest in true multicultural expertise and develop a center of excellence are those who are most successful. Make an assessment of your company or your client’s company. Who manages their multicultural efforts? Is it a center of excellence or is it “integrated?”

Evolving the Television vs. Internet Mindset

The other day I met with a new client to share my thoughts on how they should address young Hispanic women. As we spoke about this Latina's relationship with their beauty product category, I shared a list of prioritized media channels where they could reach her during each phase of the purchase-decision process. Despite this approach, the client insisted we choose between television or internet given their limited resources.

My answer: do both, or don't do either.

More and more data points to the fact that television and internet concurrent usage builds "engagement" with the audience. It allows the brand to associate with relevant content, and then begin an interactive dialogue with the audience online. While TV is great at building familiarity with a massive audience, online is where she shares her opinions on this content. Online also is the key place where she is researching and comparing product benefits and costs.

In this specific case, if the client were to only do one of these channels instead of the other, it would be difficult to see the sales movement they expect. It's not to say that it's always required to do both TV and Internet to reach Hispanic women - that's preposterous and totally dependent on the objectives and the specific target. But we in the Hispanic market also tend to forget that there are other channels in our tool box for reaching Hispanic audiences outside of television. Also, internet is not replacing TV either - the channels fill different needs in our consumer's lives.

It is important to remember that during these tough economic times, that cutting corners in marketing doesn't always pay off.

As mom always says, do your best or don't do anything at all.

Sunday, April 5, 2009

Latino Smart Phone Usage

Latinos are snapping up smart phones at a rapid pace and using these phones to surf the web more often than the general population. One of my first posts, Why the iPhone is Latino discussed the high percent of Hispanic ownership of the iPhone. I argued that it was an affordable status symbol.

Today, I revise my thinking to say that it's not just a badge to make us feel good. It's also a computer in our pocket so we can "stay connected." The Mintel Study found that Hispanics who use the Internet devote nearly three times as much time weekly to browsing websites on their cell phones (1.1 hours versus 0.4 hours for non-Hispanics).

Why do we do this? Well we Hispanics certainly stay connected with more people on average than the general market. But I have a feeling that our usage of these technologies has less to do with our culture, than our age. The Hispanic median age is 26.7 vs. 37 for the general market. Younger folks tend to be more tech savvy and enjoy connecting with family and friends via the web. My hypothesis, since Hispanics are younger - our age, not our culture, make us have a greater propensity to do things like surfing the web on our phones.

Hispanic Movie Viewers

Hispanics are avid movie watchers and no doubt helped the fourth installment of Fast & Furious become #1 at the box office this weekend. In 2007, Nielsen EDI estimated that Hispanics accounted for 33% of all moviegoers. That is more than double what Hispanics represent to the national population.

To understand the scale of this, Hispanics purchased 297 million movie tickets in 2007 compared to 150 million for African Americans. Hispanics also go to the movies more often purchasing 10.8 tickets per person vs. 7.9 for the general population.

The importance of Hispanics to Hollywood is clear. Given our propensity for downloading content online, it seems natural that the movie business should be catering to this audience online. Yet movies distribution on the web is still a frontier of pirated content. No studio is willing to release the grip of movies on the internet because of fear that their industry will go the way of the music business.

While certainly this is a realistic fear - Apple's itunes proved that digital content distribution can be profitable if properly managed. If movie studios don't make the first move soon on the web, no doubt tech savvy Hispanics will do the job for them and likely will choose a free content based model.

Monday, March 30, 2009

Hispanics and Sports - Futbol vs. Football

The second reason why Acculturated Latinos choose Hispanic targeted media in Spanish is really quite simple: soccer. Or actually, let's call it futbol since that is how we refer to it.

For non-Hispanic Americans, it's hard to comprehend how large an audience futbol commands. Futbol for them is a children's game that minivan moms shuttle their kids to practice after school. Maybe, they cite the World Cup, the tournament that grips the globe every four years. Of course, by globe we mean every country except the majority of people in the U.S.

But futbol is a religion to Hispanic Americans. It doesn't matter if you are U.S. born or foreign born, acculturating or unacculturated. The fact of the matter is, soccer is king.

Sure, the NFL commands a pretty large Hispanic audience - last year the league drew 70% of Hispanics. But, the recent World Cup qualifying match between the USA and Mexico reached about 85% of all Hispanics (male or female, young or old) through television, radio, online and mobile. Also, there's a reason why the Spanish word for futbol fans is "hinchas," which means "to pump" as in the act of pumping the very soccer balls they use to play the game. Hispanic fans are as integral to the game as the actual ball they kick along the pitch.

Going back to the original point of this two-part post, sure you can reach more acculturated Hispanics via general market media. But, let's be honest...reach isn't really the name of the proverbial game these days, it's "engagement" or "connection" or "breaking-through" to this audience. You can ignore the opportunity to address this attractive target at your peril, but make no mistake that your competition may not be so cautious.

The Power of Spanish-Language News

Clients often tell me that they adequately reach "acculturated" Hispanics via their general market media plans. They also believe that English Dominant Hispanics simply do not watch or read Spanish-language media, despite data that shows a portion of them do. Why would they consume Hispanic targeted media if they speak English? Well, options for one. But really, it boils down to two words: News and Sports.

Today, let's tackle news. Hispanic focused news organizations cover topics that general market news bureaus just don't touch: immigration, inner city education, workplace injustice and information on legal and government processes.

But more importantly, the lens that Spanish-language news organizations use to filter information is far different. Don't believe me? Let's look at an example.

A lot of digital "ink" has been used to cover Mexico's violent war against the drug cartels which have left over 8,000 dead. Today, NYTimes.com featured a piece on the escalating violence and spoke about the corruption of police forces, the flow of money and weapons from the U.S. into Mexico and the aid that Mexico will receive from the U.S.

Now, look at a piece on Univision.com that highlights the dead, particularly the "good" authorities that have been murdered by the drug cartels for refusing bribes.

No doubt, American media has a very particular point-of-view on Mexico, Mexico's systems and certainly, it's "third world" or "developing" status. Yet we Hispanic-Americans have a more nuanced and arguably, accurate perspective on our countries of origin. Spanish-language news organizations give us a better picture on what is occuring there and discuss topics like the human toll of this war, something that U.S. based media simply glazes over. Apparently, dead Mexicans aren't that interesting.

Until American media broadens its approach to the coverage (or lack there of) that it provides for relevant Hispanic issues, Latinos - acculturated or not, will always turn to Spanish-language news as an alternative.

Sunday, March 29, 2009

Latino Instant Communication

Data on Hispanic online behavior can hardly keep up with the lightning speed of changes occurring in the ways we use these technologies. One area where we over-index is in communication tools like instant messenger. With family and friends spread across the street to across the globe, we use these tools to stay connected.

Yet top instant messenger MSN is starting to see a decline in Hispanic usage. The culprit, Facebook instant messenger, where a lot of Hispanics are spending their time these days. But Facebook has some competition. A popular feature, the "status update," is already being replaced by Twitter, a service with huge popularity in urban areas.

While Twitter is enjoying growth, its' time may pass before it finds a way to earn revenue. Hispanics are going threw the web at warp speed, Twitter and Facebook need not hold back on the accelerator to keep up.

College Bound Latinos

Latino students lag their non-Hispanic counterparts in college attendance. But recent data revealed by MSNBC and the Pew Hispanic Center indicate that those numbers are improving. In 2008, Hispanics represent 12% of college students, that's 2% higher than in 2006. While these are certainly great strides, we still need to close the gap to reach at least 15% - equal to our national population composition.

The reasons for the improvement depend on who you speak to. Some note that Bush's No Child Left Behind legislation helped improve performance in inner city schools. Others say that a migration form English as a Second Language programs to intense English immersions bettered the chances of Hispanic children to succeed.

Whatever the reason, there is no doubt that a greater number of Latino college graduates will only strengthen this community's power both politically and as consumers. If there was ever a question about the continued existence of the American Dream, look no further than Latino advancement as an indication.

Tuesday, March 24, 2009

Multicultural Job Seekers

Employment search sites have reported a surge in traffic as a result of the 8% national unemployment rate. Since Hispanic and African American unemployment is above 10%, one would imagine that they represent a sizable portion of these unique visitors.

Back in January, attorney Cyrus Mehri filed a civil lawsuit against the major advertising agencies in the US. His firm cited data gathered in a commissioned study that shows a clear lack of African American representation in the industry. Some stats showed that African Americans made up just 5.8% of professionals and only 3.2% of managerial roles despite representing 14% of the population. Mr. Mehri's firm also found that blacks earned 20% less than their white counterparts. While the study did not include Hispanics, one would assume that a similar trend persists. Both minority groups contend that they are mostly relegated to roles in multicultural agencies, if they are hired at all.

With high unemployment and rampant layoffs at top ad agencies, where can multicultural job seekers turn to find career opportunities? Career Builder and Monster, the top two job seeker sites have developed diversity enhanced sites to address this need.

For example, Career Builder partnered with MSN Latino to launch EmpleosCB, a site targeted to Latino job seekers. Monster.com partnered with the NAACP to launch a diversity search site.

Despite some of these targeted opportunities, the challenge still remains that there are few jobs to fill and now more competition than ever. But one thing is certain, advertising agencies in the enviable position to hire during this economic crisis should strongly evaluate the potential contributions of a more diverse staff.

Saturday, March 21, 2009

Latino Music Downloads

The other day, Scarborough Research indicated the huge strides Hispanics have made online especially in content downloads. The biggest growth has been music downloads. We Latinos love music! That's certainly clear when you see that 32% of Hispanics download music vs. 24% of non-Hispanics.

The top performing sites online have tons of music content. Batanga.com is a music behemoth and relative newcomer having come of age over the past four years. According to Comscore, it attracts about 700,000 unique visitors to its collection of online radio stations of all types of Latino inspired music. Other sites include Telemundo's sister network for Bicultural Hispanics, mun2 which has a companion online site: holamun2.com. Then of course there is mtvtr3s.com which has been growing over the past 2 years. And for Latinos who love their Miley Cyrus as much as their Paulina Rubio, there is Yahoo Música. iTunes now also has a Latino channel. With all of these music options online, one can only imagine that music downloads will continue to be a critical touchpoint to reach truly engaged Hispanics.

Friday, March 20, 2009

Multicultural Consumer Confidence

A new report entitled Yankelovich Multicultural Marketing Study (there's a lot of cool research out this week) evaluated the current mindset of African American and Hispanics in the United States. The study sheds some light on the challenges that both ethnic groups are facing in light of greater empowerment. This is defined not only by political strength, but by consumer buying power in the United States.

Both African Americans and Hispanics note that they feel greater optimism for their personal future as a result of Barack Obama's presidency (87% and 79%, respectively compared to only 55% for non-Hispanic whites.) Yet, in light of the economic crisis, 54% of African Americans and 65% of Hispanics say they feel moderate to high anxiety about their current prospects. That compares to 43% of non-Hispanic whites.

With both African American and Hispanic unemployment reaching the 10% mark compared to the national average of 8%, it's no surprise that multicultural consumers are feeling the economic crisis like no one else. Add into the mix that both ethnic groups were disproportionately affected by the sub-prime mortgage mess and you have a recipe for disaster.

But despite these challenges, African Americans and Hispanics are critical consumer segments for marketers. They continue to grow economically (both approaching $1 trillion in buying power) and politically, (African Americans and Hispanics were critical to Obama's success.) As a result, advertisers should avoid the temptation to walk away from multicultural marketing during this recession. Neither group is genetically predisposed to brand loyalty and one brand's loss, is another one's gain.

Thursday, March 19, 2009

What Digital Divide?

The digital divide is narrowing. Today is like Christmas for yours truly. Scarborough Research just released a study on Hispanic online activity. In all key aspects especially pertaining to content downloads, Hispanics are leading the pack. (45% downloads vs. 32% for non-Hispanics.)

It's not that I want to say I told you so. But, today I sort of do. While the report does indicate that the total number of Hispanics online does lag the general population (54% vs. 68%), the rate of growth is staggering. Also, Hispanics leap frogged dial-up connections and went straight to broadband with penetration of 68% vs. 71% for the general population.

What I did find quite surprising is that online purchasing does not lag general market as much as I originally thought. In fact, 62% of Hispanics reported buying something online in the past 12 months vs. 70% for all internet users. They also spent similar amounts online to the general population ($762 vs. $861.) This new data does make me want to reevaluate my previous post on Hispanic online shopping.

All in all, the information contained in this report provides more evidence of the growing importance of the digital space for Hispanics. We continue to debunk the digital divide.

Wednesday, March 18, 2009

Diversity on Network Television Lags

For the past four years, I've read the same article. It's like déjà vu during the time when new network television shows get green lighted for a pilot. Today the NY Times reported on the lack of diversity on network shows - new or existing. No news here.

The fact that network television gets whiter every year, while the population gets browner is yet more evidence of the Big 4 networks' demise. Few programs feature prominent African American or Hispanic characters. Programs with primarily African American casts are disappearing. (Forget about an all Hispanic cast - we haven't seen that since the George Lopez Show, cancelled and now rerun in syndication.) And ratings continue to migrate to cable where casts are more diverse and program concepts are more adventurous.

Given that African Americans and Hispanics generally like to watch their programs live instead of DVR-time delayed, one would imagine that networks would be clamoring to better address these audiences. Unfortunately, in the Big 4 networks efforts to be of general interest (i.e. appeal to mostly Anglo sensibilities), they fail to connect with anyone at all.

Thursday, March 12, 2009

Hispanic Targeted Online Video

Ad Age reported today that Hulu.com, the Fox-NBC joint online video venture, is now the second most trafficked video site - trailing YouTube.

Given Hispanics' propensity to watch videos online, I wondered, where does Telemundo fit into all of this? Telemundo afterall, is NBC-Universal's Spanish-language flagship network. It's suppose to be their crowning, visionary achievement in understanding the opportunity that Hispanics pose to the marketing world. But Telemundo's content is no where to be found on Hulu.

Telemundo owns its content, unlike most of the programming airing on it's gorilla sized competitor, Univision. That includes the right to distribute it on digital platforms.

Yet, Telemundo has struggled in the online space. It recently divorced its distribution partner, Yahoo!, partially dissolving a strong Spanish-language portal that attracted over 1.6MM unique visitors in January 2008, according to Comscore. In January 2009, a Telemundo-less Yahoo! en Español attracted 1.3MM unique visitors, a 19% drop.

But a stand-alone Telemundo.com audience is a shell of its former self. In January, the struggling new site attracted just 133,000 unique visitors despite a televised media blitz on Telemundo network and on MSN Latino - their new online distribution partner.

It remains to be seen whether or not Telemundo.com will be able to regain even a fraction of the audience it once enjoyed through its partnership with Yahoo!. But it begs the question - why not tap into Hulu.com instead of going at it alone?

Wednesday, March 11, 2009

NYTimes Explore How Immigration Impacts US

The New York Times today launched A Room To Debate, a new forum and discussion group focusing on the impact of immigrants on the U.S.

Rather than just let readers battle it out which typically degenirates into a bigoted conversation full of hate, The Gray Lady assembled top advisors from different perspectives and backgrounds to provide their input. Readers can still comment, but that is clearly not the focus.

Today's discussion surrounds education and the debate over English as a Second Language (ESL). This type of dialogue is critical for America as we continue to grapple with concerns over job loss, illegal immigration and the overall impact of the changing face of America. Be sure to follow this dynamic conversation.

Tuesday, March 10, 2009

Gossip Girl (and Boy)

The self proclaimed Queen of Media, Perez Hilton, may be the most well-known celeb gossip blogger on the net. The fact that he is Cuban-American is not surprising. We Latinos love gossip! Love it!

A quick Google search for "farandula" (gossip) resulted in 912,000 different sites dedicated to the subject. "Chisme" is another word that means gossip, and that term generated 1,090,000 hits. (The fact that we have more than one word that means gossip should be a tip-off.) All the Spanish-language portals have a significant number of pages dedicated to the subject. People en Espanol's site attracts a pretty large audience daily seeking the latest on Salma Hayek's French wedding or Jessica Alba's latest denial of her Hispanic heritage.

Following celebrities for Latinos is like a cultish religion. The most popular programs on Univision and Telemundo, the most trafficked sites online and the highest circulation magazines are all dedicated to this subject.

With so much interest in this "escapist" content - marketers need to figure out more creative ways of tying into this world. While many advertisers shy away from tabloids in the general market, in the Hispanic market - you're aversion is a missed opportunity to connect during a seriously guilty pleasure.

Monday, March 9, 2009

Technically a Padre

Online Spanish-language content is still no where near the levels of English-language, especially targeted to U.S. Hispanics. Aside from the major Hispanic targeted portals, there has been few opportunities to target different mindsets and lifestages. This of course, is changing on a daily basis.

Case in point, an AOL-backed site, Techno Padres, launched today targeting Spanish-dominant mothers of pre-teen kids. The site's content is being powered by The Online Mom, a site targeted to tech savvy moms mostly in English. Techno Padres is a nice complement to an existing player, Todobebe, which targets pregnant women and mothers of preschool aged children. A Johnson & Johnson powered site, Baby Center en Español, also has robust content for expectant mothers, but they have yet to attract a sizable audience.

Until recently, parenting content online and in Spanish has been hard to find. Moms, hungry to find information on child rearing have flocked to social networks instead. There is a Spanish-language mommy group on MySpace with 2.7MM users. There they converse and exchange ideas on a host of issues like cold remedies and how to stop little Consuelo from biting her nails.

Becoming a parent is no doubt one of the scariest things in life. (Will I screw this kid up!?) Again, the universal human experience trumps language and culture.

Thursday, March 5, 2009

YouTube en Español

Last month I posted a blog about pirated Spanish-language Univision content on YouTube. The jist - there's a lot of it. So, it came as no surprise that while I was reviewing the top 10 Youtube videos of 2008, that a Spanish-language short movie, Lo Que Tú Querías Oír (What you wanted to hear), was in the #3 spot. The quirky "love story" (if you want to call it that) logged 76.5 million views. That's impressive.

What's really surprising is that the video was uploaded back in 2006! But, the video's audience didn't really take off until last year. It speaks to several factors including the shelf life of content online, the dynamics of viral and word-of-mouth online and the hyper growth in popularity of Spanish-language content online. Tons of topics for us to tackle another day, but I expect these types of examples will only continue to multiply.

Wednesday, March 4, 2009

Latino Beauty 2.0

No self-respecting Latina goes out of the house without “her face.” Beauty for Hispanics is prized – it’s right up there with family and religion. It’s no surprise then that the number of minorities seeking cosmetic surgery is on the rise, with nearly one in four procedures in 2007 performed on ethnic patients, according to the American Society of Plastic Surgeons. Hispanics led with 9 percent. Of course, the web is a key source of information on plastic surgery.

The leader in this space is Locateadoc.com, a web referral system that connects doctors with patients. It also supplies in depth knowledge on various procedures with striking before-and-after images.

I was curious to see what steps Glen Lubbert, President of Mojo Interactive and LocateADoc.com, is taking to address the needs of these potential consumers.

According to Comscore, LocateADoc.com attracts about half a million unique visitors per month with Hispanics accounting for 5.6% of that audience, are you currently addressing this audience in a unique way?
The doctors featured on our site control the description of the cases they highlight. They love to show before and after photos. Those galleries perform well across all audiences including Hispanics – everyone wants to see what was there and what they made of it.

Do any of your doctor clients highlight their specialization in ethnic populations or indicate if they offer service in Spanish?
Absolutely. Language scope is part of our basic form set-up. That’s an area where minorities can look. Some doctors market themselves as ethnic specialists, too. Many of our doctors in South Florida and Southern California have dedicated marketing efforts to these populations.

Have you considered a mirror Spanish-language site or areas of Spanish-language content to increase your Hispanic traffic?
We’ve discussed it at length and explored different ways to approach the Hispanic opportunity either within the site or with outside content like a blog. The bottom line is that we are trying to connect patients with doctors; the language is a secondary concern. We have not invested behind this area, because so far we’ve been pretty effective serving all audiences with English-language content. But, we don’t rule this out for the near future.

After speaking to some minorities interested in plastic surgery, many fear that their features would look "too white". Are there new procedures or specific training in treating ethnic populations?
The site’s before and after gallery is really a great tool to highlight specific races and ethnicities. The doctors there showcase their best work and specialization against those populations. It’s up to the patient and their selected doctor to discuss the particulars of their case to make sure they are happy with the outcome.

Ethnic populations tend to be younger, are there specific procedures like liposuction or tummy tucks that you could make more prominent to attract this audience’s interest?
Google and other search engines provide us with an indication of what procedures are of most relevance to our site users. We also look at our proprietary traffic data by age and ethnicity to prioritize content. We’re always looking to increase leads to our doctors.

For those seeking procedures abroad to save money, does LocateADoc.com provide research information on available in-country specialists?
Not presently. We have a few doctors subscribed in Mexico, but those directories are not as extensive as the info in the U.S. and Canada. The Mexican doctors subscribed to our service are right along the Texas border for patients in the U.S. looking for a cheaper alternative.

Money is an important factor. Hispanic-Americans are getting wealthier and indulging in life’s luxuries. Are there unique financial plans and payment plans to draw in middle-class customers? Is your company involved in this area?
Yes, our pages on financing are very popular. GE Money/Care Credit is our partner for potential patients to customize a loan or installment plan that fits their budget. It makes elective surgery more affordable.

How is the current financial crisis impacting your business?
There are fewer people looking to do elective procedures, overall. Google’s traffic is down for search terms related to cosmetic surgery, but there are still people looking. Instead of choosing more involved procedures, they are choosing minimally invasive ones like Botox treatments or skin resurfacing.

How do you think popular culture and the entertainment industry are impacting the cosmetic surgery industry?
Tremendously. Several television shows like The Swan, Nip/Tuck, and Dr. 90210 create a lot more buzz and drive traffic online when they air.

How has the web changed the cosmetic surgery industry?
Patients are more informed and have better expectations of what they can have done. Anytime you are making more realistic expectations, you are winning.

Monday, March 2, 2009

Why Hispanics Shop Online, but Don't Buy

Retailers are grasping at any opportunity to grow their sales in these turbulent times. Hispanics and our enormous buying power - over $980 billion in 2008 is certainly an attractive audience. $980 billion! To put that in context, that means that the 46 million Hispanics living in the U.S. have the second largest Spanish-speaking economy in the world, larger than Spain and second only to Mexico. That won't last. In 4-5 years, the U.S. Hispanic population will be wealthier than the entire Mexican economy which includes 110 million people.

So, Hispanics are critical to growing retailer business. No question. Then why is it that of all the retailers, just Best Buy and The Home Depot, have Spanish-language ecommerce-enabled sites?

Is it because Hispanics who can afford to buy online speak English so what's the use of maintaing two sites? Nope. That's silly. 60% of the Hispanic audience is Spanish-Dominant and another 15% is Bilingual - that doesn't mean those folks don't speak English. Most of us do. But we still want to do business in español.

Is it because Hispanics can't afford to buy online? No. See my earlier point about our buying power.

We Hispanics do shop online. Tons of data from AOL/Roper and Comscore support our propensity to research and shop online...but we don't really buy online. Huh? Where's the disconnect?

The reality is that while we love to research and shop online, we love to shop in person more. So while my mom may check out JCPenney.com to see what cute tops they have, she is less likely to click and pay for it online. She wants to try it on, feel the material and inspect the seams to make sure they weren't poorly made and make sure it fits well. And mostly, she just wants to get out of the house and take a stroll at the mall.

I've seen a bunch of data to support this concept of traffic vs. sales. Hispanic traffic to stores remains strong, but we aren't buying as much...that's just the nature of the economy and this will ultimately improve.

However, what about online shopping sites? Should retailers just write off the Hispanic consumer? Hardly. It takes time to change consumer behavior and you don't want to be the retailer who missed the boat with Hispanic online buying (as oppose to shopping.) Also, keep in mind that it's not like they aren't buying at your retail location. If you treat your Spanish-language website like a really cool catalogue or very interactive window shopping experience, you may position yourself for future growth into a full ecommerce enabled site when the time is right.

Saturday, February 28, 2009

Hispanic Crossover Success

In my line of work, I spend a lot of time convincing clients about the value of cultural relevance in advertising. We explain why simply translating work from English to Spanish-language is not effective. It's not about the language - it's about talking to Hispanics by using their culture as a way to their heart.

With this approach, my agency develops a lot of original creative work for Latinos. Mostly, our creative runs on Hispanic targeted media outlets like Univision and Telemundo.

Yet, there are occasions when we create work that transcends the original target audience. Creative that tugs at the heart or makes you laugh regardless of your ethnicity. It's in these instances that we realize that in spite of our cultural differences, we as humans have way more similarities.

Creativity is an online magazine that celebrates the best creative campaigns. Our agency's work for Wendy's was just highlighted by their Ad Critic Pick of the Week. This is only the third time that a Hispanic-targeted campaign has been selected. It's certainly a reminder that any differences between us are differences in small increments. Enjoy the ad.

Wednesday, February 25, 2009

Facebook Archetypes

You know a website hit critical mass when articles starting analyzing the audience that visits it. I just found this article about the 9 Facebook archetypes. It profiles that types of folks that we tend to encounter on social networking sites.

It includes archetypes like the Ghost - that guy or gal that signs up for an account, spends all but 2 minutes setting up an account with no picture - never to return again. All that remains are the sillouette of his/her missing picture and a few hundred unanswered friend requests. Or the showoff - the ladies that show too much decolletage or the guys who climbed K2 on their last vacation.

Sociologists and Anthropologists have their hands full with this one....

Online Killed the Video Star?

In these tough economic times, everyone is looking to cut corners and save a few bucks. No doubt, multicultural audiences who are some of the hardest hit are taking a really close look at every expense. One that seems like a luxury is cable. I pay over $100 a month....for hundreds of channels where ironically I can never find anything worth watching!!

I've mentioned in the past that Hispanics trail the general market in cable penetration - primarily because we live in relatively flat cities like LA and Dallas to name just a couple.

Telemundo shared some data today that said that Hispanics were considering cutting premium channels like HBO and Showtime. But, I started thinking...why end there? With sites like Youtube and Hulu.com (a joint venture between NBC and Fox) attracting millions of video viewers - isn't online video the proverbial TV killer?

Nielsen reported that last year, Americans watched on average 5 hours of TV a day! (I don't have that much time, do you?) Well, apparently the average American does. But, internet users watched 14.3 billion online videos in December 2008, that's up 41% from a year earlier.

With busy schedules because of family and personal commitments and for those of us fortunate to still have jobs - television schedules can be rather rigid. But with online video, you can watch your favorite shows whenever you want - on demand. Yes, I know, DVR is better...does the same thing and you avoid those annoying Hawii Tourism Board ads on Hulu.com, but still. DVR is an added expense...internet video is free. Is it just a matter of time before internet video gives cable a deafening blow?

Monday, February 23, 2009

Going Where No Google Has Gone Before

I just read a fascinating article about the deep web, i.e. the trillions of pages that lie undiscovered by Google in vast databases far and wide.

Google just celebrated its trillionth page "crawl," the process it uses to discern the content on web pages it then serves up as a potential solution to your Google query. Yet, even with a trillion pages, there are still trillions more that are "too deep" to be factored.

Ever wonder why Google can't give you comparative rates for a flight to Denver? Or why its Froogle software only gives you a few retailer options out of the hundreds (or thousands) that likely carry that item? It's the deep web...the places where Google has yet to "spider."

This brought me back to the original intention of the web to democratize communication. If everyone has the opportunity to use the channel to communicate, then Google is the tool that either gives you a massive audience or leaves you to fend for yourself. It's like having a publicist or doing your own publicity. The latter is likely going to be a much harder job. So then, democracy goes out the door when someone can get a massive audience via Google, instead of a lonely website with a few dozen followers (like yours truly and his blog.)

Sure there is search engine optimization - to help you improve the likelyhood that Google will read your site and put you up in the rankings. But, there remain the millions of blogs and other content that remain relatively unknown. Will there ever be a Google powerful enough to go where no search engine has gone before?

Wednesday, February 18, 2009

Facebook Privacy - What Privacy?

Facing extreme pressure from its users, Facebook rescinded their updated policy to essentially "own" in perputuity any content that a user uploads - even if that user deletes his or her profile. One would think that Facebook stole everyone's first born child with the firestorm the company endured this week. Blogs were abuzzing...

What I found interesting is two things - the idea of privacy on a social network and how Hispanics reacted (or didn't react) to the news. The easy one first: social networks are public forums! You may have implemented strict security settings, but in essence, the difference is between walking around naked in the street or on your balcony (either way, someone is going to see you.)

The second is a cultural understanding of Hispanics and their concept of privacy. I've scanned blogs and have seen few Hispanic surnames in the comments section. Hispanics don't seem to be that up in arms about this whole mess. Yet, Hispanics make up a healthy margin of Facebook users (in the neighborhood of 23% even though they make up only 15% of the population.) So what gives? Don't they care that Facebook wants to own their Quinceniera pictures?

The answer is not really. When you grow up in multigenerational households and alongside more siblings than non-Hispanics (3.2 average siblings vs. 2.3), you're idea of privacy is fluid. You understand and accept that your "business" is going to be shared with more people. You accept that your brother's friends are going to tell their cousin Maria that you threw up at the carnival and show her a picture of it. That's life. If Facebook wants to own pictures of your Aunt Teresa dancing salsa with Cuco, your pitbull, then go for it. Afterall, social networks are for sharing. Don't share what you don't want others to see or know.

Tuesday, February 17, 2009

The Future of Digital Strategists

In this job climate, there are few employment opportunities available in advertising. In fact, most agencies are laying people off. Yet, a quick perusal of recruitment sites like Monster and Careerbuilder revealed that there are digital strategist opportunities available. I started thinking, in today's climate, shouldn't we all be digital strategists?

Ten years ago when digital marketing hit critical mass, digital strategists were essential. There was a major learning curve to understand the new marketing technologies. But as time progressed, the silos continued. Today, most clients are shifting resources to the web and mobile. But, in order to make that assessment, client's need to evaluate concurrent media usage of offline and digital channels - together.

If you don't understand all channels, then you are missing an opportunity to connect with consumers the way they are experiencing media - seamlessly. Consumers follow content - the channels they choose to gain access to that content is secondary.

While I do believe there is a role for specialists, the reality of the matter is that if we aren't all well versed in digital, than we aren't doing our job as marketers.

Thursday, February 12, 2009

Pirates of the Telenovela

I just read an Ad Age article about how Univision is the #1 pirated network on YouTube according to a survey conducted by TubeMogul. In fact, with over 583.7 million views compared to the next closest network, Fox at 289 million views, Univision has a major content piracy problem on YouTube.

But this is really no surprise given that Univision and it's Mexican content supplier, Televisa, have been battling for years to clarify who gets U.S. digital distribution rights. This is a very lucrative opportunity that both are missing out on. To date, neither Univision.com nor Televisa's esmas.com have been able to showcase any telenovela video content to U.S. Hispanics.

A judge is expected to decide in March who gets the rights to stream video content on both the web and mobile. Until then, the pirates of telenovelas can continue to enjoy their YouTube fare.

The Voodoo that You Do

My co-worker keeps talking about this company called Voodoo Box. They are a media company that allows advertisers to place audio recordings on phone card servers. In essence, they offer immigrants (mostly Latino and Asian) discounted phone cards at retail stores in exchanged for them listening to an advertiser's pitch.

This seems like an obnoxious way to reach unacculturated Hispanic and Asian immigrants. I would assume that they don't take kindly to this type of interruptive messaging. Well, apparently I'm wrong.

We've tested it with a couple of clients, including Greyhound, and it's performed much stronger than most online campaigns. In fact, redemptions for the offers that we've included have been rather significant.

Who knew that Voodoo that we do could lead to the hearts of so many Latinos and Asians?

Wednesday, February 11, 2009

Socialistas Make Face Time

I was laughing to myself in the subway on the way to work. I saw the campaign for Dentyne with the tagline, Make Face Time. The campaign in a nutshell tells folks to log off the computer and have more interpersonal interaction. I started to wonder, is this relevant to Hispanics?

Over the past 12-months, the Hispanic online population boomed. The online universe of Latinos grew 19% while the overall audience stayed relatively flat. What’s more interesting is where that audience has gone. It’s not Univision.com or Terra.com, two top Spanish-Language networks. Nope. Those sites actually saw decreases in audience.

The winner. MySpace. Their Latino audience surged an incredible 293% over the past year. Not only that, but Latinos are going to the site daily and spending a lot of time interacting with friends.

Social networking sites are popular with everyone. But for us Latinos, social networking sites are like steroids for our social ways. We’re more likely to have extensive daily interaction with more people and social networks allow us to broaden our scope further. What can we say, we like being friendly.

So does the Dentyne campaign work for our market? Hardly. If you look at the stuff that Hispanics are doing on MySpace or Facebook, it’s facilitating face time, not impeding it. We’re making arrangements to meet in person, sending invites, keeping tabs on friends in South America and reading and commenting on friend’s updates. “Lucinda is bored out of her mind.” - “Lucy, quit your job and come have a drink at Perfect Pint.”

Tuesday, February 10, 2009

Why the iPhone is Latino

As I was researching competitive information for a wireless client, I came across a really interesting fact. Over 32% of iPhone owners are Hispanic despite the fact that they only represent 15% of the population. Very interesting.

That made me wonder: why is the iPhone so popular among Latinos?

It's no surprise we like the functionality of the phone. I mean, we spend a lot of time downloading music, videos, wall papers, texting, IMing, emailing, etc. But there are plenty of other phones that do the same thing. Maybe not as cool, but certainly cheaper.

Yet, the answer is really quite simple. It's status. Who wants a Blackberry Curve when you can have an iPhone? The iPhone says something about who you are. It's like driving around in a BMW with an Administrative Assistant's salary.

And when you're present during everything from the mundane every day, to abuelitas Sunday barbeque after church, then you're part of the family. iPhone, welcome to the familia.

TV’s Digital Disenfranchisement

Last week, Congress finally approved a motion to postpone the planned TV digital conversion on February 17th. The move was intended to help the 6.5 million households that Nielsen reports to be “totally unready.” While the report indicates that 5.7% of the nation is still unprepared for the switch, those numbers are much higher amongst minorities. Nielsen said 9.9% of African-American households and 9.7% of Hispanic households are totally unready.

Nielsen’s numbers also suggest a number of big markets — among them Los Angeles, Phoenix and Houston — could temporarily lose more than 10% of Hispanic or African-American households with the digital changeover.

Most believe that the lag by both of these demographic groups is driven by the lack of funding for the Commerce Department’s coupon program to subsidize digital TV converter boxes for consumers. There is now a wait list of over 3.2 million for the $40 rebates. Obama’s administration is seeking to include additional funding for this program as part of the economic stimulus package under consideration. The boxes generally cost between $40 and $80 each and can be purchased without a coupon.

I would argue that this is another example of preconceived notions about minorities' income.  African Americans and Latinos over-index in the purchases of home entertainment systems.  Latinos in particular have a high propensity for technology adoption. 

However, one technology that never reached parity with the general market is cable subscription. This is strongly related to the Hispanic population geographic distribution in markets with flatter topography such as Los Angeles, Miami, Houston and Dallas. As such, full-power Spanish-language stations like Univision and Telemundo carry well over-the-air and the lack of Hispanic-targeted cable options have kept cable adoption relatively low.

With minorities lagging behind on this issue, and over 500 stations still planning to move forward with the switch next week, it will be interesting to see how ratings are impacted.  Certainly, a reduction of viewers in these two key demographics will harshly hit the already battered networks.