By Published on .

The growth in Hispanic radio ad revenues has turned stations into hot properties.

Armed with growing ad revenues, top Hispanic broadcasters are strengthening their holdings and increasing format options in major markets such as Los Angeles, New York and Miami.

"Increased ratings, advertisers focusing on the need to advertise in Spanish and the continued, rapid growth among Hispanics in the United States are all contributing to higher revenues at station level," says Carl Parmer, president, co-CEO of Heftel Broadcasting.


Further encouraged by regulatory changes allowing multiple FM station ownership in a market, station groups have responded with a flurry of buys.

Expansion-minded Heftel has been busiest recently, acquiring a total of $85.6 million in properties since 1994, and bringing its station total to 16 in Miami, New York, Los Angeles, Dallas, Chicago and Las Vegas, Nev. Most recently it bought the remainder of WAQI-AM and WAMR-FM, Miami, of which it already owned half, for $19.8 million.

Spanish Broadcasting System set a record for the most money paid for a New York radio station with its $83.5 million purchase of WPAT-FM in Paterson, N.J., giving it two of the three current full-service FM stations serving New York's 3 million Hispanics.

Tichenor Media Systems, meanwhile, is strengthening its Texas holdings, with the year-end purchase of KAMA-AM in El Paso for $450,000 and pending acquisitions in Houston and McAllen.


Smaller players also are nabbing properties. Seventies Broadcasting Corp. purchased WRMA-FM, Miami, for $21.5 million last year. Liberman Broadcasting Co. purchased KNAC-FM, Long Beach, Calif., for $13 million in 1994 and changed formats-from hard rock to "banda"-and call letters to KBUE-FM (as in "K-Buena radio").

"The consolidation is occuring because broadcasters have new capital available and they don't have to expand into 40 markets-they can expand in the top 10," says Gene Bryan, VP-group sales for Spanish Broadcasting System.

Advertiser interest has grown as Hispanic stations realize unprecedented ratings success.

"For two years, ratings have gone through the roof. Every year it's a different market and a different station, and when the ratings come, the revenues come," says Kathleen Bohan, director of research and marketing at Katz Hispanic Media.

Markets where Hispanic radio ratings have gone through the roof include Los Angeles, where Spanish ballad station KLVE-FM knocked banda station KLAX-FM out of its No.*1 spot last fall; New York, where Spanish Broadcasting System's WSKQ-FM ranks a solid No.*2 in the market with a 5.5 share, according to Arbitron's Fall 1995 books; and Miami, where WRMA-FM, targeting the under-served mature market, unveiled a love ballad format in November 1994 and saw its audience share rise from 2.0 in the summer 1994 Arbitron books to No.*1 at 6.4 one year later.

Not to be left out, Heftel switched WAMR's format in September to Hispanic adult contemporary hits and saw its share jump to 4.7 in Arbitron's fall '95 books.


Mr. Bryan estimates broadcasters successful in grabbing both Hispanic and general market ad dollars can expect 1996 revenue growth of more than 20%. He says his New York revenues are up about 40% from last year.

"That growth would come from attacking general market accounts. I'm not getting that out of traditional revenue sources," he says.

The industry is beginning to see commitments outside the package goods arena, a traditional source of general market dollars, says David Lykes, Tichenor's senior VP-marketing and sales.

"We're being discovered more and more by manufacturers and providers," says Mr. Lykes, who foresees a double-digit revenue hike for his company in 1996.

Advertisers in banking, such as Visa; communications, such as AT&T and MCI; automotive, such as BMW; and mass-market retail have earmarked more dollars for Hispanic radio, say broadcasters.

"We have seen a lot of the general market agencies and advertisers that were perhaps not in the Spanish market before becoming involved with Spanish radio," say Ramon Pineda, president of Caballero Spanish Media, a rep firm that did new business with Visa last year.

Broadcasters foresee plenty of room for continued growth. The ratio of stations to listeners is still higher in the Hispanic market than for the general population.

"The only limiting factor to the growth of Spanish radio will be the growth of advertising that is available," says Mr. Pineda.

Most Popular
In this article: