Finally, Some New Advertisers Turn to Latin TV
Spending on Spanish-language nets rose 25% in 2002
By Allison Romano -- Broadcasting & Cable, 9/7/2003 8:00:00 PM
The 2000 Census data spurred many advertisers to open their eyes to the Hispanic market. Then they started opening their pocketbooks.
Ad spending on the three big Spanish-language broadcast networks is rising at a brisk clip. In 2002, Univision, sister network Telefutura and NBC-owned Telemundo combined took in $2.4 billion in ad revenue, up 25% from the year before, according to CMR data.
Indeed, the growth is admirable, but Hispanic ad spending lags far behind the general market. The seven English-language broadcast nets took in $13 billion in '02, according to Morgan Stanley media analyst Rich Bilotti; Fox alone, $2.2 billion.
Still, Hispanic media buyers and network executives are upbeat. They see clients spending more and new categories coming into the market. And so far, in 2003, the three Spanish-language broadcasters have already taken in $1.4 billion in ad dollars.
Before the 2000 Census, Hispanic media buying "was based on gut," says media buyer Lisa Contreras, managing director for Carat Multicultural. Then the 2000 Census showed, among other things, that U.S. Hispanics account for about 14% of the population. "Now, there is no denying what the numbers show, and it is a smart business decision."
In the Hispanic market, retail has traditionally been the driver, and that remains true. Spending is growing, though. Procter & Gamble, the largest advertiser the past three years, spent $134.1 million in 2002 on the Hispanic networks, up from $101 million the year before, according to Nielsen Monitor-Plus. The second-biggest player is Sears, which ponied up $105 million in 2002, about $15 million more than the year before.
New advertisers are bringing in fresh dollars. Retailer Target is advertising on national Spanish-language TV for the first time, buying time on Univision to sponsor the net's new prime time novella El Manantial.
"This is one of many examples of a major advertiser recognizing the benefit of reaching Hispanics in Spanish and allocating some of their funds to our company from their total budgets," Univision President Ray Rodriguez said on a recent earnings call.
And fresh categories are joining up as well. Pharmaceutical companies, luxury cars and movies are big up-and-coming sectors. (Until recently, Pfizer's Viagra was one of the only pharmaceuticals advertised on Hispanic TV.)
In the past two years, pharmaceutical spending has nearly doubled to $26 million, according to Nielsen. Motion picture advertising is up 50% to $50 million. Automotive advertising (cars and trucks) is booming, accounting for about $170 million of total ad revenue last year.
Home improvement, led by giants Home Depot and Lowe's, is growing, too. According to Nielsen, home-improvement ads generated $21 million last year, nearly double the 2001 sum.
Spanish-language–network ad executives are also trying to cultivate financial-services companies. These companies, from brokerages to banks, have not been very active but are eyeing the market with increased interest. In many markets, Contreras says, financial-services companies are holding seminars and planning meetings.
With financial services, "there is an education that needs to be done first before they can come full blast," she explains, "If you establish a relationship, the business will likely come with it."
Hispanic cable networks are looking for the broadcast growth to spill into their pockets. Fox Sports World en Español chief David Sternberg says spending is up but still not representative of the growing Hispanic population.
So, he says, "we're out there beating the drum and doing all we can to persuade advertisers."
| Ad Spending on Hispanic Broadcast Networks | |||
|---|---|---|---|
| ($MILLION) | |||
| Network | 2003* | 2002 | 2001 |
| *To date; NA = not applicable; network launched in 2002 Source: TNS Media Intelligencer/CMR |
|||
| Telemundo | $477,674 | $774,072 | $561,764 |
| Telefutura | $95,763 | $85,435 | NA |
| Univision | $780,796 | $1,507,679 | $1,325,796 |
| Total | $1,354,233 | $2,367,186 | $1,887,560 |
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