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Hispanic Upfront Heats Up

Spanish-language nets expect double-digit gains 5/18/2003 08:00:00 PM Eastern

Telemundo trotted out J. Lo., Univision and Telefutura got a plug from Oscar De La Hoya, and Azteca America staged an interpretive dance as the rival Spanish-language networks chased advertising dollars in upfront presentations in New York last week.

With their market looking for double-digit gains this upfront season, Hispanic broadcasters are trying to tempt clients with new programming—including a few innovations—and not-so-subtle reminders of their individual strengths.

Media buyers were buzzing last week over news of Telemundo's new production deal with actress/musician Jennifer Lopez. Her production company Nuyorico will first produce a novela for Telemundo and then may create reality and variety shows. No word whether Lopez will appear on-screen.

Univision offered some novelty, too, with what it billed as the first Spanish-language interactive novela. Rebeca, a story of star-crossed lovers, will let viewers vote on the ending.

Univision doesn't need many stunts to build its audience, though. The network controls nearly 70% of the Hispanic market. It launched sister net Telefutura last year to increase the company's stranglehold and challenge Telemundo. Telefutura now ranks second in some dayparts.

Even with that dominance, Univision execs are aggressively chasing more upfront dollars and new business. (At the upfront presentation, boxer De La Hoya made a cameo appearance in a Joe Millionaire
spoof in which network salesmen courted a Hispanic media buyer.) Univision maintains separate sales staffs for its three networks (the third is cable network Galavision). Another sales team is dedicated solely to pharmaceuticals, a potentially lucrative category.

The upside is clear. Last year, Univision signed 120 advertisers in the upfront. English-language networks like NBC work with closer to 250 advertisers. And, while estimates say Hispanic networks grabbed $750 million in last year's upfront, English-language broadcasters raked in $8.3 billion, and cable networks collected another $4.6 billion.

Univision Networks ad sales chief Tom McGarrity expects the Hispanic market to be more robust this year because many companies are just now factoring Hispanic marketing into their budgets. "It took time for the [2000] Census to catch up with corporate America," McGarrity said.

According to Census data, there are 37 million Hispanics in the U.S., 11% of the population. The population is expected to grow to 49.3 million by 2010. And the Hispanic audience is younger, with a median age of 27 vs. 37 for non-Hispanics, according to Nielsen Media Research.

"You can't get away from this freight train of growth," said Telemundo President Jim McNamara. He expects to see upticks from pharmaceuticals, financial services, entertainment and automotive advertising.

Telemundo will be challenged in this market, though. Since NBC plunked down $2.7 billion to acquire it a year ago, it has lost viewership to Telefutura.

One tactic to draw more viewers is producing U.S.-based novelas. Telemundo will have three set in the U.S. this TV season as part of its $100 million programming budget. The network plans to make about three originals a year at its new production facility in Miami.

Telemundo will draw on its NBC relationship for events, including the 2004 Summer Olympics and the Golden Globe. Repurposing efforts, which started with a modestly watched replay of NBC's Kingpin, are a work in progress, McNamara said.

Another sort of repurposing happens on Azteca America, the American outlet of Mexican broadcaster TV Azteca. The network, which counts about 25 stations and hopes to add 19 more by the end of the year, airs programming produced and distributed by its Mexican parent. Azteca America made its first-ever upfront presentation in New York. Chairman Ricardo Salinas describes his network as an alternative to "monopoly" player Univision: "We know you've been wanting an alternative, and this time it's for real," he told advertisers.

But even with alternatives, Univision still rules the Spanish-language market. It's simply too big to ignore.

"Univision can walk in and say give me a 100% [of your business]," said Lisa Contreras, director of media buyer Carat Multicultural. "They now have the No. 1 and the No. 2 broadcast networks plus Galavision on cable."

Univision and Telefutura program as broad-based general-entertainment networks but offer counterprogrammed schedules: When Univision airs its steamy novelas in prime time, Telefutura has sports and Hollywood blockbusters. As a result, both are enjoying ratings growth.

Univision is also dipping into original, U.S.-based productions, but cautiously. It already has programming deals with Latin American producers, including one with Mexico's Televisa under which Univision receives programming in exchange for a portion of its ad revenue.

"We have such a huge supply we can choose from," said Univision President and COO Ray Rodriguez. "Every time we produce in the U.S., we have to make sure it will attract advertisers that are not on Univision."

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