Latinos accounted for more than half of the United States’ population growth and the demographic now makes up nearly 19% of the country’s total population, according to data from the U.S. 2020 Census released last month. However, only 6% of the marketing industry’s investment is spent on the Hispanic community, according to the Hispanic Marketing Council.

But while the amount marketers spend on the demographic hasn't evolved much, what has changed is how they spend it. 

“I started [in the multicultural advertising industry] in the mid-'90s and back then when you were pitching to clients, you were bringing your census numbers and you were showing your indices versus the general market,” said Sandra Alfaro, executive VP and managing partner of culture-first agency 305 Worldwide. “Today, it's not about convincing them that they have to. The conversation has shifted to 'How do we do it most effectively? How do we do it responsibly? How do we measure it?'”

Beyond measurement, there has also been a growing sophistication in the ways marketers are approaching the Latinx community—bringing specialty agencies upstream into the conversation, using data to target by interests within the demographic, reshaping creative approaches and the choice of media, and even recasting the "multicultural" moniker into "cross-cultural."

Reexamining labels

Alejandro Ruelas, CEO of Third Ear, which was first called LatinWorks, founded his agency in 1998, which he said was a time when Hispanic marketing was viewed as just another box to check.

This type of thinking carried on for a while and undoubtedly still does for some brands today. Executives from eight multicultural agencies Ad Age spoke with said that putting the Latino population under a general "Hispanic" label is a mistake when trying to reach the audience.

“Hispanic marketing is like saying digital marketing these days—it’s an old label,” Luis Montero, CEO of the Community said. “Like digital, I feel we’ve lived in a 'post-Hispanic marketing' world for a while now. The Hispanic community is so much more than a segment but rather an undeniable and increasingly influential piece of America’s cultural fabric. So it’s increasingly hard to separate, and that’s a good thing.”

Brands’ original thinking on the subject was perpetrated by “Hispanic agencies,” Ruelas said. “Sadly, several of the established 'Hispanic agencies' of that time catered to those client perceptions instead of focusing on the consumer.” Ruelas continued. “As a result, the use of Hispanic stereotypes became common practice, and the airwaves inundated with jalapenos, maracas, grandmothers and other symbols of Hispanic cultures.”

Nowadays there are many multicultural agencies and traditional agencies are even adopting their own culture-forward offerings, but even the term “multicultural” is becoming outdated. In August, Taco Bell named Cashmere as its first-ever culture agency of record. When the partnership was announced, Taco Bell CEO Mark King called multicultural the “new general market,” which was a sentiment Cashmere’s Chief Creative Officer shared two years ago during an Ad Age podcast and is growing among culture-focused agencies.

“I refer to us as a cross-cultural agency, because a lot of times the multicultural name has been used to refer to Hispanic, Black, or Asian specialists agencies. I feel like cross-culture is a higher-order umbrella term that encompasses the general market and some of these other underrepresented segments,” said Pedro Lerma, principal and founder of Lerma/.

Getting a seat at the table

Oftentimes multicultural agencies are brought on once a brand has finalized its campaign or strategy which can limit the input a multicultural agency can provide. However, Alex Macias, managing partner and chief operating officer of Macias Creative, says he’s “finally seeing a big change” in that regard.

“In the past, a lot of times brands came to us—we still see it today—where everything is fleshed out and then they go, 'Oh, by the way, what can we do for U.S Hispanics?’” Macias said. “But now it's like ‘All right guys, this is what we're going to target, we're going to have a meeting with all our agencies, and we're going to talk about this as a more holistic conversation.”

This sentiment is in line with what consultants are seeing on a broad scale.

“We've seen a very specific move in the multicultural agency's role from distributing the core marketing message in relevant ways; to active participation in the origination of the core messaging strategies,” Matt Ryan, CEO of consultancy Roth Ryan Hayes said. “Several leading marketers are asking their lead agencies to both deliver multiculturalism at their core and to work collaboratively with their specialist partners.”

One brand that has been consistent in its efforts to appeal to a Hispanic demographic is McDonald's. Alma is the agency behind some of the chain's most memorable multicultural work, such as last year’s collaboration with Latin singer J. Balvin which featured a song, “Dorado,” that was made available in the restaurant chain’s app after appearing as a commercial during the Latin Grammy Awards. 

Luis Miguel Messianu, founder, creative chairman, and CEO, said the key to the 27-year relationship, which has spanned 13 chief marketing officers, is the brand’s willingness to bring the agency into strategy meetings early.

“Most of our promotions with McDonald's over-index [with] the general markets because we know they're based on cultural insights,” Messianu said. “We work very closely with the other shops, like Wieden+Kennedy, to build synergy, but not at the expense of relevance.”

However, Messianu says not all brands will operate the same.

“It's a case-by-case basis and you have to earn the client's trust to make sure that they understand why a portion of the strategy grants a different effort,” Messianu said. “To this day, you know it's still an uphill battle. We're still playing defense. We have to justify why we're not doing such-and-such and why it makes sense, but the smart advertisers get it.”

Language and retrofitting

It’s important for brands to understand that Spanish should be used as a “tactic, not a strategy,” Ruelas said. All the agency executives interviewed for this story said there have been times that brands would simply translate their general market work into Spanish and call it a day. The danger is coming off as disingenuous and actually offending the people you are trying to reach. 

“When the Super Bowl came to Miami last year, every brand came to Miami and spoke Spanish or Spanglish,” said Macias. “The problem was that the Spanish that was written was not the Spanish that is spoken. Spanglish has a time and a place for Spanish when there's no better way of saying something where you have to inject the Spanish word, because it means so much more. But when you say ‘I want there to be an 80/20 English-to-Spanish ratio,’ then you’re forcing Spanish words and it’s just like ‘I see what you're trying to do, but you're just off.’”

Another common misconception multicultural agencies still get asked about today is retrofitting. This is when a brand, for example, shoots a commercial with a general market cast and then reshoots the same commercial with a Hispanic cast.

“We're still having this debate with some clients that feel like they can pretty much do a double shoot and just change the casting,” Messianu said. “I remind them it’s not only the stories we tell, but also how we tell the stories. It's about the subtleties and nuances. I think we need to blame the media companies that told clients for years that they were already reaching a multicultural audience. Yeah, you're reaching eyeballs, but you're not making a connection.”

More focus on data

One way brands can get a better sense of the market they want to go after is through data. While this is far from a new concept, John Gallegos, CEO of the United Collective, says there’s still improvement that needs to be made on the multicultural front. 

“Some of the areas where we still need to make more progress are in data and measurement,” Gallegos said. “We have to get better at having a customer conversation about Hispanics because from consumer to customer is a really big deal... And as you begin to value them as a customer, typically investment follows.”

Part of his effort to improve data and measurement is the creation of Poly United, which is a marketplace analytics consultancy that is part of the United Collective and acts like a “marketing ecosystem” of different information Gallegos feels is needed in today’s marketplace. An agency with an analytics focus is Refuel Agency, which provides data-driven media and marketing solutions for targeted audiences such as teens, college, multicultural, and military consumers.

“Our research shows that media strategy and spending is nuanced and should take into consideration age groups, ethnicity and other factors,” Leela Ramdeen, Refuel’s VP, enrollment strategy and planning said, referencing its latest report on the Hispanic community. “For instance, 25 to 54-year-old Hispanics are more likely to engage with ‘traditional’ media like print and radio than the general population.  In addition to how the Hispanic audience differs from the total U.S. population, we also look at the variance in behaviors within the Hispanic audience. Knowing how to engage with each is key to building a multichannel media plan.”

As multicultural agencies continue to take on bigger roles for brands they will need to find ways, like data and measurement, to differentiate themselves from each other.

“It’ll be ​​interesting to watch as the multicultural agencies seek to differentiate themselves from each other by further specializing,” Ryan said. “Some examples include being known for trend orientation and insights; or being DTC and ROI driven, or owning and managing interesting opt-in databases of their constituencies.”

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