Hispanic newspapers, moving beyond the circulation scandal that hit one of their major players, want to go head-to-head with their biggest rival: Latino broadcasters.
"From the client to the agency side, I think for a long time Hispanic broadcast had the field to itself," says John Paton, chairman-CEO of ImpreMedia, whose papers include El Diario/La Prensa and La Opinion. "The power of print, particularly Hispanic print, is only now becoming known to the key agencies and [marketers]."
"I'm not interested in beating any Spanish-language paper out there," says Digby Solomon Diez, CEO-publisher of Hoy, the Tribune Co. title that was forced to almost halve its New York circulation following the 2004 circ debacle. Instead, he looks at Hispanic broadcasters and says, "Even if I captured all of [the papers'] share, I would still be the tail on the dog. The biggest problem [Hispanic newspapers] have ... is our penetration, our share of readership. Our ability to deliver audiences in major markets is pitiful compared with what broadcasters have."
This "pitiful" situation hasn't stopped the parade of launches and acquisitions. Over the past year, there's been activity in major Hispanic markets like Tampa, Fla., and smaller pockets like Atlanta, says Diane Hockenberry, director-audience development at the Newspaper Association of America. That activity included ImpreMedia's purchase of San Francisco paper El Mensajero, the company's fourth buy since 2003.
"There are some attempts by different newspapers [especially ImpreMedia] to make sort of a national newspaper because we are still sort of missing that in the Hispanic market," says Veronica Payan Gonzalez, managing partner of CMS Partners, a new Hispanic agency in New York.
Ms. Hockenberry says newspaper companies are "realizing the [Hispanic] market is a strong market and a stable market."
Launches in smaller markets are "an interesting dynamic. That provides a great opportunity," says Isabella Sanchez, VP-director of media services at WPP Group's Bravo Group, Miami. The agency executive says her reliance on newspapers is increasing "for clients where newspapers are a natural fit," including telecommunications companies like Cingular Wireless.
"We are seeing advertising top-line growth across our properties at many times the growth you're seeing year over year in mainstream newspapers," Mr. Paton asserts.
Meximerica, publisher of Rumbo in four Texas markets, planned to hike ad rates this month. CEO-Editorial Director Edward Schumacher Matos calls the move a "sign of the confidence we all feel ... we don't think we need to take advertising away from TV; we just want a bigger percentage of the growth. Print has such a small piece of the pie in the Hispanic market."
It doesn't appear that the Hoy circulation scandal of 2004 inflicted any lasting damage on Hispanic papers as a whole.
"We all are aware that was sort of a bigger Tribune group issue ... so I don't think it really scared any advertisers away," Ms. Payan Gonzalez says. The bigger issue for media buyers has always been to keep track of smaller papers coming in and out of the market, she says, adding, "Our industry is just still growing so these kinds of things, I don't think it really turned advertisers off. It certainly didn't do it for us."
Ms. Sanchez echoes that sentiment about Hoy, saying the circulation situation isn't "hampering any advertising print commitments" and that Hoy was "very gracious" in the way it handled the situation.
After the Hoy scandal, Mr. Solomon Diez cleaned out the executive ranks and changed the editorial and circulation strategies. Now, Hoy is going for 20%-30% of its audience "in those regions of our market that were absolutely critical to the sort of advertisers we were going after," including grocery chains, big box retailers, department stores and car dealers.
"Hoy's original plan was very traditional old-style newspaper. It was all about the circulation number," he says. The paper has pulled back from its extended distribution area to target areas that have a high concentration of unacculturated Hispanics near locations of major retailers.
"We took the time with a new management team after having gone through exorcising all the ghosts from the circulation scandal," says Mr. Solomon Diez. "Went through who are we? What market are we trying to serve? Where are the growth opportunities? When you're in a situation like that, when you've lost credibility and people are attacking you, it gives you tremendous liberty to reinvent yourself. ... I don't want to just come back and say we've fixed the problem-we've reinvented ourselves [based] on a future of what a newspaper has to be to succeed going forward. It allowed us to make a clean break from the past."
Hoy cut ad rates in New York, the epicenter of the circulation scandal, by 40%; while ad revenue fell in the Big Apple last year, it grew 20% for the Chicago edition and almost 70% for the Los Angeles edition. Hoy is looking for 20% overall ad growth in 2006.
It will take more research before advertisers are willing to believe that readership runs as deep as Hispanic papers are claiming.
"There are very few sources that tell us about newspaper consumption," says Ms. Sanchez. "When ... our clients say, `Hey, why do we really need the newspapers?' ... that is the biggest gap." What companies like Simmons say "is 70-something percent of the market is watching Spanish-language TV, and 80% is listening to Spanish-language radio, and 40% is reading newspapers.
"The television business has done a tremendous job as a unit in gaining research to justify return on investment, and that is lacking in the Spanish-language print world."