With the 2010 U.S. Census around the corner, many advertisers are looking to see what that survey says about the growth in Hispanic demographics.
One of those advertisers is State Farm Insurance, the nation’s largest insurance provider and a huge television advertiser. State Farm spends approximately $60 million a year in Hispanic media, according to Nielsen Media Research.
Like all advertisers, State Farm has been reviewing ad strategy in the wake of the recession, advertising director Ed Gold told an industry forum last week. But the insurer is still willing to pay a premium for ads that have a lasting impact or meet its specific needs, he said.
“It is kind of like auto insurance, who doesn’t want a good deal?” Gold said during an interview session with Broadcasting & Cable magazine business editor Claire Atkinson. “But the cheapest option is not always the best option. Sometimes you pay a premium for what works better.”
Those options could include “big-tent” events, which attract huge groups of viewers. One of those that State Farm is eyeing is the 2010 World Cup soccer tournament, the finals of which will be televised by ESPN and its sister networks, as well as Univision, next summer.
With Mexico looking like it will make it into the draw, the tourney becomes an even more attractive buy for advertisers seeking to make an impact in the U.S. Hispanic marketplace, Gold said.
“The eyes of the Hispanic market are on the World Cup,” Gold said. “I think the World Cup is going to do very well and it is definitely something we are looking at.”
Gold spoke at a Hispanic Cable event presented by B&C and the Cabletelevision Advertising Bureau.
Gold said that while the Hispanic cable landscape is growing, it still has a ways to go before it can steal significant ad dollars from market leaders Univision and Telemundo. It’s estimated Hispanic cable programming commands 10% of the U.S. Hispanic audience in aggregate.
“The mass viewership is still on the two big networks,” Gold said.
But as viewership and ratings on Hispanic cable networks grow, the advertisers will follow them.
“Our efforts are going to be a bit disproportional there, but we want to be where we see the audience going,” he said. “[As] ratings increase and viewers increase [on cable], we will make changes.”
There are currently 48.4 million Hispanics in the U.S., according to Pew Hispanic Center senior demographer Jeffrey Passel, who also spoke at the event. That’s more than triple the Hispanic population in the U.S. in 1980. Passel estimated the Spanish-speaking U.S. population would boom to 128 million by 2050, depending on factors such as intermarriage within other ethnic groups and birth rates.
The rapid growth and large number of young Hispanics — second-generation Hispanics have a median age of just 14 years old — are what make Hispanic demographics so important to advertisers.
“To us, [Hispanic marketing is] a no-brainer,” said Mark K. Stewart, vice president of global media services for Kraft Foods, which has a Spanish-language food magazine, Comida y Familia. “You’re either in the game or you’re dead.”
Alex Weprin and David Tanklefsky are staff writers at Broadcasting & Cable, sister publication to Multichannel News.