This issue's Media Markets Report shows the Hispanic market simultaneously confronting two profound shifts: Hispanic consumers are moving from Spanish to English, and at the same time from traditional media to the Internet. The double crossover has caused confusion about the direction of the market on both Madison Avenue and Wall Street.
The two trends originate from the same underlying demographics. Hispanics' progress in education, income, English-language usage, and product sophistication makes the conventional Spanish-only media strategy of the past 30 years seem inadequate. Growth of the second and third generation means young Hispanic consumers have more English-language skills and less connection to a country-of-origin culture. In that context, the slowing growth of Spanish-language ad spending since 2003 looks like a rational response to changes in the market (see article "Market Slump or Long-Term Trend?").
But since 2002, online ad spending to reach Hispanics has grown 900 percent, according to the Internet Advertising Bureau. Online expenditures now total an estimated $100 million (see article "Surfing in Two Worlds"). That's more than several traditional media categories, including out-of-home and magazines. And clearly the Spanish-English shift fuels the traditional-to-online media shift: More than three quarters (79 percent) of U.S. Hispanic Web visitors express a preference for English or bilingual Web sites, according to comScore Media Metrix.
The way the two trends have occurred simultaneously demonstrates the market's rapid development. Minority populations often lag behind the general market's front edge, but in this case the Hispanic market has kept pace. The U.S. general market is suffering from the same dislocation of advertising and media – as Google, Yahoo!, and other sites take dollars and audience away from national broadcasters and newspaper chains.
So far, Hispanic marketers and media outlets have struggled to adapt to the shifts, with varying degrees of success. Attempts at bilingual media such as Mun2 and some local newspapers haven't produced any high-profile successes. Univision has developed a Web portal, but without providing any English-language content. Many Hispanic media outlets have decided to stick with "businesses that are slowing due to new media," in the words of Kit Spring, an analyst at Stifel, Nicolaus & Co. (as quoted in the article "Conflicting Signals").
In light of consumer preferences, it appears that the future will "click" for Hispanic media and the audiences they serve. At Hispanic Business, the online format allows us to provide more research and articles than could ever appear in a paper-based magazine alone. Therefore, our strategic plan for 2006 calls for HispanicBusiness.com to provide more of the data-intensive, relevant content that readers have come to appreciate from the pages of Hispanic Business.
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