Telemundo Trumpets Hispanic Power4/27/2003 08:00:00 PM Eastern
Armed with new market research, Telemundo is telling advertisers they need to boost spending in Spanish-language television or miss reaching one of the fastest-growing and biggest consumer buying segments of the U.S. population.
That message is rapidly becoming a broken record: According to 2000 U.S. Census figures, there are now about 40 million Hispanics, or 13.4% of the total U.S. population; by 2020, Hispanics will make up 19% of the population.
But sales of Hispanic-television ads lag the data, by plenty.
Telemundo commissioned market-research firm Global Insight to crunch the numbers (from the Census Bureau and other public-domain databases) and forecast the impact that Hispanic consumers and their spending in key ad categories will have on the U.S. economy over the next decade.
Telemundo executives say that only about half of major advertisers spend money on Spanish-language TV in the U.S.
That could be a mistake going forward, they believe, given the fact that Hispanic spending power will grow an estimated 400% between now and 2020, to $2.5 trillion, according to the Global Insight forecast. That translates to average annual growth of more than 9%, which is 3 percentage points higher than the growth forecast for spending by the non-Hispanic population over that period.
Telemundo Executive Vice President Steve Mandala calls that a "huge business opportunity" for corporate America.
Adds Global Insight Managing Director Chris Hollings, "Sales to the Hispanic population is the fastest-growing submarket for almost every consumer product or service."
That includes big-ticket items like cars. Telemundo Vice President Mike O'Shea, in presenting some of the data from the new study to ad/marketing executives in New York last week, said car sales to Hispanics over the next decade will climb significantly higher than sales to the general population.
On average, car sales to Hispanics will increase 5.4% annually, vs. 1.4% for the general population. By 2012, Hispanics will account for 11% of all new-car sales, totaling some $32 billion.
The motion picture industry will rely on the Hispanic population for a bigger chunk of its box-office growth over the next decade. Currently, Hispanics account for almost 15% of the industry's $9.5 billion in box office receipts. Global Insight predicts that, by 2012, Hispanics will account for 18% of some $16 billion in movie-ticket sales.
Over the next five years, Global Insight projects that Hispanic spending on prescription drugs will climb at an annual rate of 15.2%, compared with 12.6% for spending growth in the category by non-Hispanic households. In part, says O'Shea, that will be due to the 10 million newly insured Hispanic employees entering the workforce over the next decade.