Univision Still Stalking English-Language Broadcast Bucks

The network’s upfront strategy is to lure away Big-four ad dollars and keep Spanish-language competitors at bay

Why This Matters

WHY THIS MATTERS
With Hispanic buying power estimated to hit $1.5 trillion by 2015, Univision’s strategy play could well pay off.

It used to be that broadcast network executives were the ones that threw barbs at each other leading up to the annual upfront ad buying and selling season. But in the past few years, they’ve been relatively quiet; this year, it’s the Hispanic network sales execs that are busy talking, taking pokes at multicultural leader Univision.

There may be growing competition among the Spanishlanguage networks vying for marketers’ ad dollars in this upfront, but Univision Communications’ sales chief is being dismissive of his competitors, instead targeting the English-language networks ABC, CBS, NBC and Fox.

Univision’s president of advertising sales and marketing Keith Turner says he means “no disrespect” to the other Spanish-language networks, but “our main competitors are the English-language broadcast networks and those are the ad dollars we’ll be going after during this year’s upfront.”

The other Hispanic networks are taking some shots at Univision for primetime ratings declines this season, but the network is still the overall primetime ratings leader by a wide margin, and Turner says he’s looking for another record upfront ad sales take, even without the FIFA World Cup telecasts to sell for next summer.

While not divulging Univision’s 2013 upfront ad dollar take, Turner says it was up 17% over 2012, and that increase was larger than the percentage increase any of the English-language broadcast networks produced in the upfront last year.

“We continue to close the gap between us and the English-language networks,” Turner says, stating that since January, Univision has added 95 new brands to its ad rolls across assorted categories. Some of the new brands include Samsung Galaxy S4, Nutella and Southwest Airlines.

He adds that in the second quarter, ad revenue is up between 10%-12% over the same period last year. And he points out that on most nights Univision beats one or more of the English-language broadcast networks in the 18-34 demo in primetime, and also does so on many nights in the 18-49 demo.

Tom Maney, executive VP of ad sales for Fox Hispanic Media—which includes two-year-old MundoFox, as well as Fox Deportes, Nat Geo Mundo and Fox Life (formerly Utilísima)— counters that Univision’s ratings Monday through Friday from 7-11 p.m. are down close to 25% in the 18-49 demo this season and that Hispanic viewers are shifting to different networks “little by little.”

“Univision has added new cable and digital networks but the audience seems to be shifting out of Univision and into some of those other networks,” Maney says. “Univision Network’s audience is not growing.”

Maney says MundoFox, which targets Hispanics with English-language programming, “offers marketers options to target different types of Hispanic lifestyles” and is providing “alternatives to the old habit of watching novelas every night.”

Univision has traditionally been the Hispanic network giant in offering a mass audience of viewers and in this upfront, will offer packages across two broadcast TV networks, 11 cable networks, 62 TV stations and 69 radio stations, as well as digital options.

“We’re not just selling 30-second spots on Univision,” Turner says. “We’re selling advertising across all our platforms.”

All For One

Telemundo for the first time goes to market in the upfront in conjunction with the other NBCUniversal owned TV networks, which will expand the number of Hispanic viewers it can sell to in packages.

Mike Rosen, executive VP of ad sales at Telemundo says buying the Spanish-language network along with some ad time in the other NBCU networks will enable marketers to reach 90% of all U.S. Hispanics every month. “Our closest competitor [Univision] is somewhere in the 60% range.”

Rosen adds, “Our goal is to tap into that reach potential for marketers across language and platforms. We will help marketers reach Hispanics with culturally relevant messages in both Spanish and English. In the past there was a Hispanic marketplace and an English-language marketplace. That concept is outdated. Now we can sell across both our Hispanic and English-language platforms with one ad buy.”

Media buyers are greeting the new Telemundo/ NBCU upfront ad sales strategy with a degree of cautious optimism. They see the positive possibilities but they also say the strategy could backfire.

Joe Zubi, CEO of Miami-based Zubi Advertising, one of the largest independent Hispanic ad agencies in the country says reaching 90% of Hispanics over the period of a month is “attractive,” but the potential danger is that Telemundo becomes marginalized and marketers make it just an add-on to their Englishlanguage buys.

“Hispanics do watch English-language television but the highest-rated shows they are watching are not on NBCU cable networks or even on NBC, other than The Voice,” Zubi says.

And other than The Voice, according to Nielsen data, the next most watched broadcast network shows by Hispanics include ABC dramas Resurrection and Grey’s Anatomy, NBC drama The Blacklist, ABC sitcom Modern Family, the newsmagazines 60 Minutes (CBS) and 20/20 (ABC), and Fox’s American Idol. And none of these draw more than 1 million Hispanic viewers per week.

“Pricing is going to be very important,” Zubi says. “A lot is going to depend on how NBCU prices all of its inventory. They can let marketers pay for Telemundo together as part of packages, but they need to sell it separately. ”

Gonzalo del Fa, president of GroupM Multicultural which oversees Hispanic media buying for GroupM agencies, agrees with Zubi that reach alone should not be the most important factor when marketing to Hispanics. “A message needs to hit touch points,” del Fa says.

“A message needs to be targeted to specific buyers of a marketer’s products. Just throwing a bunch of [gross rating points] at as many Hispanic eyeballs as possible is no longer desirable. We as buyers are looking for relevant touch points across all media platforms. Marketers want to get into the hearts of the right Hispanic consumers.”

Top Of Mind

Despite Telemundo’s joint selling within NBCU, Zubi believes Univision is still going to be the No. 1 network marketers get on board with to reach Hispanic consumers in this upfront. However, Telemundo is going to get a large share of the ad dollars too because its ratings have improved in primetime, and because of its continued ability to do brand integrations thanks to its ability to produce a good amount of its own programming. And some of the network’s newer reality series, such as La Voz Kids (the Spanish-language version of NBC’s The Voice), are pulling in sizable audiences. This season, La Voz Kids is averaging more than 2 million viewers, including more than 1 million adults 18-49.

Diedre Smalls-Landau, head of Identity, the multicultural unit of Inter public Group, says if NBCU sells Telemundo advertising along with its English-language networks’, it is going to face a strategic challenge. “It can be an opportunity but they are going to have to work out exactly how to do it. Our clients are looking to reach bicultural consumers but how much does NBCU’s other networks reach them?”

Smalls-Landau believes this year will be a “starting point” for NBCU in selling Telemundo with its other networks, but it’s going to take some time to see how the media buying community accepts it.

While Univision and Telemundo will again capture the lion’s share of upfront Hispanic ad dollars, some of the smaller Hispanic networks have improved their distribution and programming mixes and could get some more consideration from buyers.

“We’re also making buys on MundoFox and Nuvo TV because there is an appetite for Hispanic viewers who watch programming in English geared to Hispanics,” Zubi says, adding that Estrella, which programs in Spanish, does well in some of the local markets, such as Los Angeles.

GroupM’s del Fa says most of his agencies’ clients are “doing some amount of Spanishlanguage advertising,” but that amount varies by company and brand. And he adds that clients wanting to reach all Hispanics can’t do it on Univision and Telemundo alone. Another reason for looking at the smaller Hispanic networks is the need to balance out ad buy packages.

“Buying just Univision and Telemundo is very expensive,” he says.

Fox Hispanic Networks’ Maney acknowledges that MundoFox had “some challenges” to overcome following last year’s upfront, but all four of the Fox Hispanic Networks are currently showing ratings growth this season along with increased distribution.

“Our ratings are up between 70%-90% across the board and our ad revenues are up in the mid-teens in percentages at all four networks,” Maney says. “For the six months between Sept. and March, in primetime, MundoFox was up 93% among viewers 18- 49, NatGeo was up 39% and Fox Life was up 50%. And Fox Deportes ran its first Twitter Amplify campaign with Heineken. This upfront for us will be about trying to change media buyer habits.”

Craig Geller, senior VP of ad sales at nuvoTV, says his network’s English-language programming reaches a more upscale, targeted audience than Univision and Telemundo. “Our viewer’s median income is about $55,000 per household and our median age viewer is 32.”

Geller says the network in last year’s upfront doubled its number of advertisers from 35 to 70 and the plan is to further increase that this time around. “We expanded our distribution and launched more original content,” he says. “And our audience is primarily second and third-generation English-speaking Latinos who aren’t watching Univision and Telemundo.”

So, how will the Spanish ad marketplace move in this upfront? Zubi says that will depend on how quickly the English-language networks get their deals done or whenever the multicultural buying units from the large holding company media agencies want to start their negotiations.

But Univision’s Turner is not planning to wait on the English-language networks to finish their selling before he starts his. “Last year we were able to get our selling done earlier than usual because some of the English-language networks took their time, so we started doing deals. But this year, we are going to try to begin negotiations when the English-networks do.”