Half of Hispanic Online Ad Work Still Controlled by General Agencies

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NEW YORK (AdAge.com) -- The general market ad agencies that now control half the money spent for Hispanic online advertising can expect increasingly stiff competition from Hispanic ad agencies that want a larger part of that pie.
Media 8 is a 4-year-old Hispanic shop that provides digital services to clients including Mexicana Airlines and the U.S. Army.

The escalating demand for online Hispanic-related marketing services is spurring the creation of new Hispanic digital specialty shops as well as the opening of digital departments by existing Hispanic agencies.

Heightened competition
“The trend is for general-market agencies to keep the digital budget associated with Hispanic and take money away from Hispanic agencies,” said John Santiago, co-CEO of Media 8 Digital Marketing of Miami. The 4-year-old agency provides services directly to clients and also works as a partner with Hispanic agencies.

“Hispanic agencies can’t just have a digital capability; they have to be up to par with the general-market agencies," Mr. Santiago said. "But clients give their Hispanic agency a couple hundred thousand dollars [for digital] and the general market agency a couple million, and expect the Hispanic agency to do the same kind of work.”

$60 million to $100 million
Although the Internet Advertising Bureau estimates that Hispanic online advertising could reach $100 million this year, Mr. Santiago said the total is likely to be closer to $60 million, up from about $40 million last year. He estimates that his agency, with 29 staffers, has 15% to 20% of the Hispanic interactive advertising market. Media 8’s clients include Mexicana Airlines and the U.S. Army, working with the Army’s Hispanic agency, independent shop Cartel, San Antonio, Texas.

Another Miami-based digital agency, Latin 3, was started to serve Latin America, but has a growing interest in the U.S. Hispanic market.

Agency expansion
And NoBox, a leading 6-year-old Puerto Rican online agency with an English-language Web site and a receptionist in San Juan who answers the phone in English, set up a Miami office in October 2004. Two of the agency’s four partners -- Client Services Director Margarita E. Irizarry and Chief Strategist Carlos M. Garcia -- have moved there.

“We’re going after the U.S. Hispanic market and the general market, too,” said Monica Heitlauf, NoBox’s media director and one of the two partners still based in San Juan. She said the agency is already working on two U.S. Hispanic assignments: a Spanish-language Web site for Johnson & Johnson’s Tylenol and the Hispanic portion of a Procter & Gamble Co. contest to vote for a new Crest toothpaste flavor this month.

The voting is being tweaked for a Hispanic audience. For instance, it will steer away from the general market contest’s parallels with the two-party presidential race.

“I’m not sure the Hispanic market would totally get that,” she said.

And the Hispanic contest, targeting New York, Los Angeles and Puerto Rico, will drive traffic to a P&G minisite, where visitors can not just vote but also sign up to win a trip to the Caribbean, she said.


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