Advertisers Are Still Significantly Under-Investing in the Hispanic Audience, Despite ‘Latin Boom’

The Summer of 1999 was a pivotal moment in the U.S. cultural zeitgeist: Latin pop music burst into the mainstream, driven by the crossover success and appeal of artists such as Ricky Martin, Jennifer Lopez and Marc Anthony, to name a few. The “Latin Boom” was so powerful, that it heralded the inception of the Latin Grammy Awards the following year and led the nation’s top marketers to double their efforts in reaching Hispanics.

Before you get too excited, it should be noted that doubling efforts meant going from 1.5% to 3% of their total advertising spend. Baby steps, but steps, nonetheless.

So, it stands to reason that Hispanic ad spend must have experienced similarly explosive growth from that much-heralded leap to 3% in 2000, right?

Only if you consider going from 3% of total advertising spend to 4% over a quarter century an “explosion.” Instead, the explosion was reduced to a spark, its fire extinguished by legacy planning paradigms that kept Hispanics relegated to the “whatever we have leftover” spend column.

Meanwhile, the business imperative of connecting with and winning today’s young and rapidly growing Hispanic consumer segment (which represents 25% of the U.S. population under 30) has become even more critical to brand growth and health for the long term.

In reaching the Hispanic audience, the problem and the solution come down to two words: better data.

The stats

The biggest effect of the “Latin Boom” was the long overdue spotlight on the economic significance of the surging U.S. Hispanic population, which was growing four times faster than the general population by the time the 1990s had come to a close.

Fast forward 25 years later, the U.S. Hispanic population has more than doubled from 31 million (11% of the population) to 63 million. That’s almost 20% of the U.S. population.

As of 2021, their economic clout increased to $3.2 trillion in annual buying power. To put that in perspective, if Latinos were an independent country, their GDP would rank fifth in the world, ahead of the United Kingdom, India and France.

Brands who fail to future-proof their bottom line by connecting to the cultural nuances of Latino communities with authentic insights; and those who fail to make Hispanic spend integral vs. ancillary to their core growth strategies, will find themselves hitting a brick wall with this powerful consumer constituency.

As two of today’s biggest Latina artists, Shakira and Karol G said in their hit collaboration “TGQ,” the Hispanic consumer will tell brands: “I don’t have time for something that doesn’t do anything for me.”

Right audience, wrong impressions

Going into the 2024 upfront season, marketers, agencies and media partners can address this core impediment to increased Hispanic-targeted ad spend by asking four simple questions.

Is the data capturing consumption nuances?

With Hispanics still leading consumption in over-the-air-broadcast (141 index), big data sets must consider all viewing data. This notion was reinforced by a Nielsen report which concluded that Return-Path-Data-capable homes undercounted Hispanics by 33% and Spanish-language dominant Hispanics by 49%.

Additionally, according to a Pew Research Center survey, a quarter of Hispanics are “smartphone-only” internet users, indicating that they own a smartphone but lack traditional home broadband services. By comparison, 12% of non-Hispanic white adults fall into this category.

Does the data capture in-language consumption?

The Spanish language is the common thread among Hispanics. Research tools must be able to collect data in language, to ensure that the Spanish-dominant segment of this group (close to 50% of total) is represented.

How are Hispanic data sets being validated?

Last year, data validation firm Truthset unveiled research detailing how the overall data industry includes just 58% of Hispanic audiences in the U.S. Not only were 42% of Hispanics missing in third-party datasets, but findings also revealed that 70% of targeted Hispanic impressions were not delivered to the designated audience.

How are you building in first-party brand data?

Some media companies such as TelevisaUnivision are establishing their own identity-based data graphs, built by using a mix of its first-party account logins, IP addresses and set-top box data to resolve its user IDs at the household level. It recently joined forces with Omnicom Media Group to match its advertiser first-party IDs within a data clean room environment, validate audience overlaps and target those audiences in scaled programmatic channels.

For years, the Hispanic audience has been chronically underrepresented in audience metrics, and therefore under-addressed. Meaningful investment growth demands an accurate representation of both numbers and behaviors.