Heineken USA Shifts U.S. Shops For Tecate

Inspire Replaces Mexican Agency That Had Created U.S. Ads

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Ending an unusual experiment, Heineken USA will no longer rely on a Mexican-based agency for all U.S. advertising on Tecate. Instead, the importer has selected Inspire, Dallas, to oversee English-language campaigns for the Mexican brand, Ad Age has learned.

The marketer 14 months agoshifted the entire U.S. account to Olabuenaga Chemistri, which has long handled the brand in Mexico. The consolidation – seen as a cost-cutting move -- included a limited number of English-language ads as the brand ramped up its strategy of reaching out to acculturated Hispanic drinkers.

Olabuenaga will still handle Spanish-language advertising in the U.S. But the brand was not satisfied with the English spots and tapped Inspire after a review, said Tecate VP-Marketing Felix Palau. "We realized that when a Mexican agency tries to develop English creative, it feels translated," Mr. Palau told Ad Age. "So in all honesty, we were not comfortable with the delivery."

Inspire is No. 41 in Ad Age's Hispanic Fact Pack ranking of the 50 largest U.S. Hispanic ad agencies, with 2011 revenue of $4.4 million. Clients include McDonald's and Sprint.

Mr. Palau said he is comfortable with Inspire because the agency's employees are themselves "bi-cultural." He added: "They speak English and they speak Spanish. They absolutely get these consumers … They have it in their DNA."

Inspire will also pick up advertising for Indio, a Mexican dark lager that Heineken USA brought to the states last year in select markets. The account had been at Olabuenaga Chemistri. The brand targets urban, acculturated Latinos, or what Heineken calls "Los Indies." As such, advertising has included Spanglish slogans, such as a billboard declaring "Ya esta here." Media buying this year will include digital and outdoor.

Inspire's workload for Tecate will initially be limited to local radio advertising and out-of-home, although Mr. Palau did not rule out TV ads down the road.

The shift comes as the importer puts more emphasis on Tecate Light, which is in the midst of a growth spurt that has helped lift the entire Tecate franchise. Light, which entered the U.S. market in 2007, is sold in several Western states in addition to New York City. Consumption increased every month for the 14 months running from November 2011 to December 2012, including a huge 80% jump in October, according to Nielsen figures cited by Heineken USA.

Light has historically been advertised along with regular Tecate. But this year Light will get more dedicated marketing in the form of billboards and other outdoor executions such as wrapping large structures to make them look like beer cans. Still, unlike the separate campaigns that competitor Crown Imports has begun runs for Corona and Corona Light, Heineken USA plans to keep Tecate and Tecate Light woven together.

"It's not Coca-Cola and Diet Coke that are very different brands," Mr. Palau said. "This is a franchise. Tecate Light lives and breathes all the masculinity cues of Tecate." Still, he added that "if in the future we see that Tecate Light gets so big that it becomes the center of this brand, we may end up in a situation where we have to rethink our strategy."

Light comprises 13% of the Tecate franchise sales in the U.S., up from 7% in 2011, according to the importer. But in Mexico, Light dominates with 80% of the total brand's sales, suggesting that the line extension might have plenty of growth potential in the U.S.

The first radio ad by Inspire – which will hit markets soon – keeps the brand's long-running "con caracter" tagline but plugs Tecate and Tecate Light as "dangerously bold cervezas," in a lighthearted, somewhat irreverent approach using suggestive word-play.

The ad is part of a strategy set in motion a couple years ago to expand Tecate from its traditional base of new U.S. immigrants to more acculturated Hispanics with humor. The move was precipitated by the fact that second- and third-generation Hispanics are accounting for a larger share of the Hispanic market.

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