Build Bridges to a Growing Bicultural Market
True, marketers have been aware of the growing Hispanic market for years. And with recent political events showing the enormity of this population, marketers certainly are not turning a blind eye. But are mailers targeting Hispanics correctly? Are they losing out because they don't know how to find and influence certain segments of this group? More specifically, are marketers missing the boat on a growing sector that has both disposable income and a propensity to buy through direct channels, i.e., acculturated Hispanics?
Who Is Acculturated?
To answer these questions, Rick Blume, vice president of multicultural marketing at 21st Century Marketing, a list brokerage firm, first explains who acculturated Hispanics are.
"They've picked up American cultures and traits, they listen to American music, watch our shows and tend to speak and read English," says Blume.
But this definition is not black and white, says Michael Saray, owner of consultancy Michael Saray Hispanic Direct Marketing. "There's this gray line existing when trying to define acculturated Hispanics, because the population is in a state of change," Saray explains.
"We are accustomed to hearing the word assimilatedwhich means giving up one's roots of their home country and becoming a mainstream American. Acculturation is not quite assimilation. Roots and culture still remain intact to some extent even into the third and fourth generations. And, oftentimes, different generations within the same households will speak and read different languages."
Gustavo A. Gruber, business develop-ment manager, emerging markets, at Chicago-based Banta Direct Marketing Group, painted an even more specific picture by indicating where acculturated Hispanics live today as reported in a study by the Pew Hispanic Center.
"The study revealed that the fastest growing regions in which Hispanic populations live are suburban neighborhoods," notes Gruber. "Such neighborhoods would consist of what many would consider acculturated Hispanics."
In fact, this study, Dispersal and Concentration: Patterns of Latino Residential Settlement, found that the majority of Latinos live in neighborhoods where they are the minority, and that U.S.-born Hispanics are more likely to live in such neighborhoods than foreign-born Hispanics.
More importantly, this population represents a strong market for those in the direct mail business. In a session at the Direct Marketing Association's Insert Media Day last year, Saray noted that Latino purchasing power is expected to reach $1 trillion by 2007, with the median yearly income of a Hispanic head of household at more than $44,000. He also pointed to evidence that Hispanics tend to be direct response buyers: In a survey of Hispanic consumers conducted by the DMA Directo Council, 64 percent of respondents stated they definitely or probably will purchase products via direct channels in the future, and 66 percent felt that direct mail offers are somewhat to very useful.
Don't Get Lost in Translation
Because of the multigenerational, multilingual and upwardly mobile nature of this market, the challenges of how to reach them and where to find them are significant.
According to Saray, one of the biggest hurdles marketers face, whether they know it or not, is languageor, at least, the translation of it.
"Some marketers will take a mailing written in English and have that exact copy translated for their Spanish mailings," says Saray. "That's often a mistake. Certain nuances vital to Spanish buyers are left out and missed by doing so."
Saray adds, "For instance, I've seen mortgage mailings that use a specific wordhipotecafor a home mortgage that sends up a red flag for Mexican readers. Hipoteca, to this population, means a last-ditch desperation loan. It is better to say house loan as opposed to mortgage. The better term would be prestamos."
To help remedy the language barrier, Saray points out that many marketers incorporate bilingual copy. "Even with that we are finding families want to prove both messages are equal. They want to be sure the mailing is not a trick, and if there is one slight discrepancy in the translation, readers become suspicious."
Gruber expands on this issue, noting that there are 21 different nationalities of Hispanicsfrom Mexicans and Puerto Ricans to Agentinians. "After counting to 10, [for example,] people from different nationalities begin using idiomatic expressions," says Gruber. "It is important for direct mailers to keep in mind that there is really a basic Spanish that is understood by all Hispanics and marketers would be wise to stick with that."
Finding acculturated Hispanics presents a major challenge as well. Gruber says that in terms of databases, the problem comes in selecting Spanish-sounding surnames.
"Marketers look for names that have Spanish roots, but they are missing [Hispanic] women who marry a non-[Hispanic] person," says Gruber. "Then there are people like myself who have a German last name. So the challenge is with quality of names. Some companies [go] a step beyond and say, 'Well let's go ahead and take those names and only mail to those that live in a highly Hispanic neighborhood.' But they are still leaving out many individuals who do not live in those areas. It is still a tough call."
What else poses an obstacle for marketers? Gruber points to a certain mindset that is much different from other immigrants.
"Latin Americans come here for economic, political or family reasons. So they are thinking that as soon as things get better, they will go back home," explains Gruber. "There is somewhat of an assimilation, but it takes a lot longer. What it boils down to is you need to understand the level of acculturation to craft the best copy."
Insight into a prospect's acculturation also will help you further refine your message targeting, Gruber asserts. "For example," he says, "a copywriter developing a letter addressed to a woman in the general market who is 35 and makes $80,000 writes for her hot buttons. But, when the copy is translated for a [Hispanic] woman in the same situation, a [Hispanic] woman is not equal to the woman in the general market."
And it should be noted that within the Hispanic market, even more so than the general market, copy is a key driver behind successful direct mail campaigns.
"In the general market ... 40 percent of response comes from good lists, 30 percent has to do with the offer, 15 percent is due to layout and another 15 [percent] for copy," states Gruber. "But in the Hispanic market, we see that the list has much more impact on response. Instead of 40 percent, we allocate 50 percent to the list; 30 percent is a result of the copy; then 20 percent is divided equally between offer and layout. Copy is actually the second most important element, outranking the offer."
The Right Product
Even after employing strategies that work, most marketers know it comes down to the product.
According to Blume, products appealing to Spanish culture and health usually perform well. "Vitamin magalog and bookalog mailings seem to work well," says Blume. "Also, Catholic fundraising, music club mailings and Spanish book and magazine subscriptions are popular."
Gruber adds that mailers using freemiums and premiums often experience great success as well. "For instance, labels and any combination of offers and premiums that portray some upfront gift tend to generate a lot more response."
On the flip side, Saray reveals a few products and services that do not work. Child life insurance products, for example, may be misinterpreted. "You can't sell this to most Hispanics. It is like betting on the kid dying," Saray says. "By nature, Hispanics can be a little fatalistic and superstitious, so ... this does not work."
Saray adds that credit card companies may not fare so well either. "The Spanish ... use debt for emergencies or special occasions," says Saray. "They [don't] go crazy in debt to get the second car or keep up with the Joneses, but they will use it to pay for the 15th birthday party for their daughter or for a wedding."
Completing the Circle
While Gruber is excited to work with marketers on determining acculturation levels and targeting more effectively to the Hispanic population, he reminds marketers that all the work done on the front end needs to be properly supported by work on the back end and in customer retention. One of the reasons nonprofits have had so much success with this market, Gruber notes, is because they are so disciplined at developing relationships with their donors.
"As marketers begin to accumulate more of the Hispanic population and reap the rewards of their efforts, they begin to think, 'Wow. We have all these new members or subscribers and donors,'" says Gruber. "But then they begin to realize that they don't know how to handle their new customers when they call on the phone. Is your company or organization ready to go bilingual ... completely? I ask marketers to come full circle on this."
Sharon R. Cole is a Philadelphia-based writer contributing to print-industry publications.