Hispanic Advertising Agencies are Experiencing a Swing of the Pendulum

Hispanic marketing follows a pendulum pattern. Back in 2000, when Hispanics became the largest minority, there was a boom. And that boom consisted of Hispanic advertising agencies. So the pendulum swung to the left favoring Hispanic agencies. GM agencies did not care too much and often argued that the market was not really worth chasing. Now, 10 years later, money is tight, and companies are looking to consolidate their efforts to supposedly save money. So the pendulum is swinging to the right favoring GM agencies.

But this is a farce. When has a GM agency ever cost less than a Hispanic agency? When have you heard of a GM agency having fewer employees than a Hispanic shop? See where I’m going? There is no real savings. GM shops cost more. Adding a Hispanic arm to it won’t change the rate? Will it? Anyone?

Do GM agencies know Hispanic media habits or consumption? I don’t really think so. I recently put together a plan to reach Hispanics in Northern California, collaborating with a GM shop. It became very clear that they did not understand that Hispanics consume media differently. They wanted us to move 10% of the early morning news and fringe media mix to primetime to make the plan have “high-reach premium programming.” Does that make sense to anyone else? We had to explain that the early news and fringe are #1 rated news programs in either English or Spanish. There is a huge learning curve in understanding Hispanics. You can’t just boilerplate a GM plan to effectively reach Hispanics.

GM agencies may know numbers: Hispanics are the fasting growing segment, Hispanics have the highest birth rates, or that there is a digital divide between acculturated Hispanics and first generation Hispanics. But do they understand Hispanics? Do they understand that there is more to Hispanics than age, language, cultural heritage, or economic situation? Have they really lived with a Latino and seen the struggle of trying to make it in the US? Sat down to have a Modelo Especial after a fútbol game? Or sang a Juan Gabriel song on the front of your porch on a sunny afternoon? There is a difference between knowledge and understanding.

It is true that Multicultural Agencies are losing ground to their GM counter parts; just look how Home Depot hired a GM agency to reach Hispanics. But does this mean that the GM agencies will deliver efficiencies of scale or provide better results in reaching Hispanics–probably not. It really means that the GM agencies have finally caught-on to the shifting demographics in the US population and they don’t want to lose that potential revenue. I feel bad for companies that think they will find efficiencies in consolidating, but I am sure it will help the pendulum swing back to the left favoring Hispanic agencies again.


Fausto Gortaire
Account Director
HeadQuarters Advertising Inc.