GROUPS SELL MULTINATIONAL MARKETERS ON GAUGING CONSUMER BUYING HABITS;TO LEARN REGION, ADVERTISERS USE LATIN AMERICAN MARKET RESEARCH

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Multinational marketers are only now coming to understand who Latin Americans are.

The answers, in the form of market research gauging advertising and consumer habits, are worth millions to marketers and researchers. With some markets booming and others mired in recession, the answers are more important than ever.

"With recession, consumer research has become a fundamental aspect, going hand in hand with improving both products and sales," said Sandra Fern ndez, research manager with Corpa Publicidad/ Ogilvy & Mather, Caracas.

Gallup, Audits & Surveys and Roper Starch Worldwide recently introduced products to marketers trying to break into the region..

Understanding how Latin Americans think and spend can determine marketers' performance, said Gabriel Gonzalez Molina, president of Gallup Organization Latin American division in Miami. Gallup in November released its "Socio-Economic Allocator of Latin American Consumers," dividing the region into eight socioeconomic categories.

Income dispersion is highly disproportionate in Latin America, where the wealthiest 20% of people hold 64% of income, Mr. Gonzalez said.

To get a pan-regional picture of consumers' disposable income, he said, Gallup polled residents of Bogot ; Buenos Aires; Santiago; Rio de Janeiro; SÌo Paulo; and Mexico City, Guadalajara and Monterrey in Mexico. "The approach is vital for strategic thinking," he said. "As a marketer, I wouldn't look at countries any more-I'd look at these metro areas" for allocating resources.

Audits & Surveys needed to form a study of Latin Americans useful to the 31 ad agencies, print and TV media involved in its 1995 report "Los Medios y Mercados de Latinoamerica."

The study included 6,000 personal interviews in 19 countries, encompassing 91% of the Latin American population, said Paul Donato, senior VP-media and communications research with Audits & Surveys.

The result should be a keen look at purchasing power regionally, useful to media for luring package-goods marketers, he said.

"Much of the development of Latin America will be a function of how the other 50% [outside metropolitan areas] consumes and develops," he said.

International researchers hope to create a uniform methodology platform-a daunting task, as few products can integrate global databases to provide a consistent look at consumers.

The multinationals aren't the only ones crunching numbers. In-country market researchers have developed reputations for knowing their markets.

Increases in research investment and economic and political stability have fueled the expansion, said Nelson Marangoni, president of Research International, SÌo Paulo.

Automotive, electronics, telecommunications and food companies are interested in studies to guide their entrance into new markets, Mr. Marangoni said, but some of that work comes up short for pan-regional marketing initiatives. Argentinean Marketing Association provides a seven-level socioeconomic scale; the Brazilian Association of Institutes of Market Research and Public Opinion's five-level scale tracks education and material possessions; and the Mexican Association of Research Institutes has used seven levels and 13 indicators.

"You could never compare apples to apples," Mr. Gonzalez said. "The more you know about Mexico, the more isolated you are to the region. You have to find your Mexican parallel."

The result can wreak havoc on marketers entering the region. Most Latin research organizations use varied methodology, so results cannot be combined easily, causing product- and market-specific research efforts, said Rodrigo Garnier, regional director for Central America for Garnier/ BBDO.

"There are no readily reliable sources," said Mr. Garnier. "Most research is done by a specific client for a specific category."

Some Costa Rican marketers seek information from agencies and in-house corporate researchers, said Jose Carlos Hernandez, a marketing director at Colgate-Palmolive Co., San Jose. To date there's little need for internationally produced studies, he said. "We're requesting more and more details from our producers."

Problems do exist with quantitative research and forecasting. Until 1991 in Argentina, when the peso was matched with the U.S. dollar, marketers were most worried about managing business in triple-digit inflation-so little research now exists, and marketers want more options.

"There aren't enough companies to do all the research," said Maria Luz Gonzalez Carman, director of marketing for Unilever's Elida Ponds in Argentina.

Recent economic slides have forced research cuts in Mexico, where consumers don't have the money to buy goods. "There's no doubt that [consumer research] spending has been affected by the crisis," said Phillip Keeler, director of advertising at C-P. The marketer relies more on in-house personnel than outside agencies.

The crisis cut even deeper for outside researchers. Pearson, Mexico City, saw 1995 billings fall 20% after a strong 1994, said Manuel Barberena, general director.

During the first months of the peso crisis, companies slashed their plans-Unilever cut 40%, he said-and 14 of Pearson's 20 scheduled studies were canceled.

Business slowly began to expand in the second quarter of 1995, and Pearson, whose multinational clients' research costs have been halved with the devaluation, sees "a good opportunity for Americans or Europeans," he said.

Much of this leaves agencies to conduct their own research. McCann-Erickson has used a psychographics study developed after Venezuela's 1989 crisis, said Rayza Gamez, VP-strategic planning.

Young & Rubicam developed proprietary products gauging market activity, brand performance and consumer desire.

Y&R's cross-cultural consumer characterization in Argentina, Brazil, Colombia, Mexico and Venezuela, will attempt to couple socioeconomic commonalities with personal interests and hobbies.

"Socioeconomic is a vital factor," said Andrew Halley-Wright, director-regional strategic planning and research with Y&R Latin America, Miami.

"We're in the middle of recession, so everyone wants to know everything," Ms. Gamez said. "They think the more information they have, the easier it will be to make decisions. Latin American marketers need information."

Contributing to this story: Peter Brennan, San Jose, Costa Rica; Michael J. Galetto, Buenos Aires; Sophie Hares, Caracas; Claudia Penteado, Rio de Janeiro; Tara Sullivan, Santiago.

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