At first glance, the Spanish-language publishing market offers some welcome relief for a downcast industry. While mainstream U.S. publications struggle to stop slowly dwindling circulation, Spanish-language publications are in full growth mode. However, data indicate that beneath the surface the growth in Spanish-language print may be just another market bubble.
A study by HispanTelligence®, the research arm of Hispanic Business, finds that 59 percent of the purchasing power in the Hispanic market lies in English-speaking households. Because purchasing power underpins the value of advertising in any medium, the recent growth in Spanish-language print means more publishers must compete for only 40 percent of the Hispanic audience. "Nearly 21 percent of all U.S. Hispanic purchasing power was generated by less than 6 percent of [high-income] Hispanic households," the report states. And more than three-quarters of those households, defined as earning more than $100,000 annually, are English-dominant.
Despite the economic data, the Spanish-language print market has surged ahead. Between 2000 and 2003, nearly 200 new Spanish-language publications jumped into the mix, a 14.2 percent increase, reaching a total of 1,586 different print products. At the same time, circulation rose 17 percent to 42.33 million, based on data from the Latino Print Network, the market's leading print advertising broker. According to Hispanic Business' U.S. Media Markets Report, ad money in Hispanic print rose 15.4 percent this year.
The new players range from local one-person shoppers to major launches by Corporate America. The larger entrants include ImpreMedia Corp., created by the merger of New York's El Diario/La Prensa and La Opinión in Los Angeles; The Dallas Morning News, which launched the Spanish-language Al Día; Tribune Co., which has launched its daily Hoy in New York, Los Angeles, and Chicago; and Rumbo, a chain of dailies in San Antonio, Houston, Austin, and the Rio Grande Valley, bankrolled by Spanish publisher Recoletos.
In magazines a similar boom has occurred, but with a more even mix of English- and Spanish-language products. New launches include AdWeek Marketing y Medios, an advertising trade paper from VNU Media; bello, a California-based culture magazine; and New York-based Hombre for men.
"This is the third wave of mainstream investment in Hispanic print," says Kirk Whisler, president of the Latino Print Network. "The 2000 Census, the quality of the weekly publications, and the amount of both local and national advertising going into Hispanic print are all factors that have interested major corporations. Perhaps the number one reason mainstream publishers are interested in Hispanic print is that they know they need to grow their circulation and the Hispanic market is both the most cost-effective and most appropriate avenue."
"People are making acquisitions in a very fragmented industry," says Carlos Signoret, co-manager of Hispania Capital Partners, the private equity firm that sold La Raza to ImpreMedia after owning it for barely a year. "The reason is simple: demographics. The assimilation is not as fast [for Spanish-language readers], so you can actually develop a print product over time. And you can do it from a national point of view."
Mr. Signoret believes the recent flurry of acquisitions and start-ups breaks down into three categories, based on publishers' strategies. The first group consists of players trying to build a national chain of Spanish-language newspapers. ImpreMedia and the Tribune's Hoy qualify; both publishers currently have papers in New York, Los Angeles, and Chicago. Eventually Rumbo might join the category, but Mr. Signoret notes that so far it has concentrated on Mexican-Americans in Texas.
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