Great article on predictive analytics from the MediaReset blog
Yeah, sure — Big Data. We get it, right? We all know that the digital age is producing huge amounts of data about consumers and their behavior. And, sure, we know that anybody who’s in the marketing and advertising business — like local media companies — needs to get good at it. Right? Not that […]
Category Archives: Marketing
by Jose Villa, December 3, 2015, 10:21 AM (A MediaPost Op-Ed)
All industries go through cycles and evolve. Most follow a common trajectory that begins with rapid growth, then slows down, matures and ultimately faces creative destruction (which J. Schumpeter coined the “ultimate fact of capitalism.”) I’ve been thinking about this in relation to the state of the Hispanic marketing industry, as the industry trade association AHAA recently celebrated its 20thanniversary.
Not a Growth Industry Anymore
The state of the Hispanic ad business generates a lot of emotional responses, as seen in my January 2011 article, “2011: The Year of Creative Destruction.” Ask anyone who works in Hispanic marketing for their perspective and you’re likely to get a gloomy response. You’ll hear, “It’s in decline” or “it’s never been harder” or “the future is uncertain.”
Is Hispanic Marketing Dying?
A number of indicators point that way.
There has been an appreciable decline in the number and size of Hispanic agencies in the last five years. From the closing of former powerhouse agencies like Bromley, to consolidation of shops like Vidal Partnership and MGSCOMM, the Hispanic ad business seems to be heading in the wrong direction. There are very few mid-sized Hispanic agencies left in some of the biggest Hispanic markets in the U.S. like Los Angeles, New York and Chicago. A simple comparison of the 2007 membership roster of AHAA shows 93 member agencies compared to only 48 in 2015.
Mergers and acquisitions (M&A) are another gauge for the vitality of an industry. M&A in the Hispanic ad business has dropped off a cliff since its peak in the early 2000s. All the big agency holding companies have Hispanic shops and do not appear to be in the market for Hispanic agencies. The only Hispanic ad agency to be purchased by a major network in the last 10 years was La Comunidad by SapientNitro in 2014. The valuation multiples I hear for Hispanic agencies are pretty low – probably the best indicator of the bearish outlook on the business. The situation is similar in the Hispanic media business.
A Growing Market?
Yet the Hispanic population continues to grow and is quickly approaching 60 million and 20% of the total U.S. population. Investment in Hispanic marketing has never been higher. Hispanic ad spend continues to post annual increases, with 12% growth in 2014 following almost continuous year-over-year growth since 2003 (Kantar Media). Hispanic consumers are also generally viewed as one of the most attractive consumer segments in the U.S. with their rising socioeconomic status, large and growing families, and increasing consumer spending.
Maybe it’s Maturity
Hispanic marketing has all the markers of a mature industry whether you look at media or ad agencies.
Most of the largest Hispanic advertising accounts are consolidating with a handful of agencies. Of the top 50 Hispanic ad spenders in 2014, 50% of the ad spend is occurring among 27 companies that are working with just seven Hispanic ad agencies. Hispanic ad agency revenue in 2014 paints a similar picture: the top 10 Hispanic ad agencies represent 48% of the revenue generated by the top 50 Hispanic ad agencies (as reported by Advertising Age).
On the media side, TV represents 76% of all Hispanic ad spend in 2014. That media spend is concentrated within eight companies, with Univision, NBC Universal and 21st Century Fox dominating.
Two macro-trends point to further industry maturation:
- The growing trend towards a Total Market Approach by marketers
- The net negative immigration trend among Mexican immigrants
The next five years will likely see more consolidation. Instead of new start-up Hispanic agencies or media companies, we’re likely to see something akin to what happened in the African American marketing business – fewer agencies, fewer media companies and the continued move of multicultural marketing out of the silos.
by Karl Greenberg – MarketingDaily, MediaPost, November 3, 2014
I thought this article to be extremely important in light of unprecedented media spend shift from traditional media to digital platforms, and even within the digital eco structure….according to Karl Greenberg’s blog on MediaPost…”Marketing is dysfunctional at a lot of companies. And in spite of the widely adopted refrain about breaking down silos between practices, silos are still the order of the day.”
Elevator Pitch: SoftTech’s Charles Hudson on the next big thing — and the lack of diversity in VC – San Jose Mercury News
Elevator Pitch: SoftTech’s Charles Hudson on the next big thing — and the lack of diversity in VC – San Jose Mercury News.
“One of the biggest mistakes entrepreneurs make is failing to heed clear signs from the market that the idea they are pursuing just isn’t working. “
Image courtesy of SoftTech VC. ( Kathleen Dylan )
Are You A Native Or An Immigrant?
I haven’t reposted in quite a while, as I don’t get much time to read about the things I love between my day job selling ads at The Washington Post and taking care of my family of five (no tears please)! As soon as I opened up time to read I saw this great article penned by blogger Earl J. Wilkerson (How Publishers Can Embrace Digital Natives and Digital Immigrants). Loved it. Thanks Earl…now I know who I am…although I always had an idea…it’s a great read, so I share with you…
I came across an insightful read on the INMA website featuring a blog authored by Steve Gray, a former exec at the American Press Institute (API). Steve blogs about disruption in the media, and this particular post is chock full of data on why media companies need to quickly change/adapt sales strategies to conform to current and future media trends. In his post Steve focuses on newspapers, print and on-line.
But don’t be mislead…this is not about discounting the value of newspaper readership at all. In fact, newspaper readership is holding its own…check out newspaper trends with our northern neighbors (Canada) and you’ll see what I mean…we need to examine the trends and levearge the value of both mediums…Enjoy!
We all know that customization is the trend and it is what our audiences expect. However, it is even more critical in the area of health and wellness. We need to move from “hitting them” at the right place, at the right time, with the right message to understanding what that consumers needs at the specific time and join them in the moment.