There's been an across-the-board shift in automotive marketing in recent years. Consider the situation at the Chrysler arm of DaimlerChrysler AG. Since the beginning of the decade, network, cable, and other TV spending has dropped from 75 percent of the total Chrysler budget to just 55 percent and "is declining another 3 to 5 percent a year," according to the DaimlerChrysler unit's senior vice-president of global marketing, George Murphy.
While Mr. Murphy stresses that "TV is not going away," resources are being diverted to radio, print, billboards, and especially to Internet and "event marketing."
Chrysler is not alone. Toyota's youthful Scion brand all but eliminated TV from its marketing strategy, putting prime emphasis on events, such as sponsored parties at some of the country's hottest nightclubs. Scion found this strategy especially effective in reaching youthful ethnic groups, including Hispanics. Other automakers are following this lead – which should be no surprise, as it reflects the underlying social nature and structure of the Hispanic community, suggests Martin Walsh, executive director of sales and marketing at GM.
According to Mr. Walsh, there are many subtle differences in the Hispanic community that can easily be lost in a casual marketing effort, and attention to those differences will affect everything from the products a manufacturer promotes to the way it writes a loan. Hispanic buyers, GM research suggests, tend to be particularly driven by style, price, and that more nebulous concept, "accommodations." "That's a reflection of Spanish culture... which is [more likely] to have extended families living at home," explains Mr. Walsh. "We need to provide comfort not just for the driver, but for the extended family."
That carries through to the financial side, manufacturers have discovered, where it is common for an entire family to chip in for the purchase of a car.
Smart lenders, such as General Motors Acceptance Corporation (GMAC), have revised their practices to account for that fact when determining a Hispanic borrower's resources. This ability to pool assets is one reason the community's car-buying numbers are growing so rapidly, Mr. Walsh adds. Immigrants are often acquiring the means to buy a new auto or truck "if not in the first generation then the second," he says. "Compare that with past generations of European immigrants, where the ability to acquire a new car or home might have taken three or four generations."
Industry marketers have also had to learn a lot about the assimilation process. On the one hand, "Hispanics are 81 percent more likely to purchase" a vehicle, says Mr. Rodriguez at Ford, if [the company has] ads in Spanish." But on the other hand, experts caution carmakers to recognize that – as with immigrant Germans, Italians, Jews, and other groups – subsequent generations of a family are more and more likely to want to communicate in English.
Even in using Spanish, savvy marketers recognize the need to gear regional messages to local tastes and tongues. "We need to be cognizant of that," explains GM's Mr. Walsh, "in how we construct" everything from the message to the music, as well as the accent of an ad's narrator.
At the turn of the new millennium, the U.S. Census revealed there were 35.3 million Hispanics living in the United States. "Since then, growth has continued at a brisk pace," finds a report from the Pew Hispanic Center. While the overall U.S. population increased another 2 percent by 2004, the Hispanic community grew about 14 percent, bringing the total population to an estimated 40.4 million.
Achieving the American Dream
And all signs suggest that, when adjusted for economic cycles, the community's share of the car-buying population will swell steadily and move up-market. "Hispanics are here to live the American dream," says Jessica Potts, manager of public and industry affairs for AIADA. According to the trade group's July 2005 report, 72 percent of Hispanic luxury car owners have a household income under $75,000, and 66 percent are under the age
The real question for automakers is, "Who will dominate this market?" For decades, Detroit's grip seemed unflinching. But in recent years imports, especially from Japan, have increasingly gained in appeal. Manufacturers that don't attend to the community's unique needs and desires will lose the sales.
Consider Los Angeles high school teacher Charlie Lopez. When the numbers on the corner gas pump started spinning like a slot machine, Mr. Lopez decided it was time for a change. He had long been a loyal Ford fan, but "I realized I was never going off-road in my Explorer," he says, "so why did I want to spend all that money on gas?"
Only a little reluctantly, he decided to trade his SUV in for a new Toyota Prius. At the time, it took the dealer nearly four months to deliver the wildly popular hybrid-electric vehicle to Mr. Lopez, who admits it's taken some time to get used to driving the compact sedan. But now that he can use it to drive in the carpool lanes all by himself, he feels the decision was clearly right for his needs.
He is by no means unique.
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