The bleak news about the health of global advertising just won't stop.
ZenithOptimedia yesterday slashed its 2009 forecast for a second time since December 2008, when it predicted statistically flat planetary growth.
Now, it predicts the world's total advertising dollars, Euros, pounds and yen to drop by 8.5 percent from 2008. The sharpest cuts were seen in the automotive, financial and business travel categories.
"Faced with extreme uncertainty, advertisers in most sectors planned for the worst and cut their costs in anticipation of steep drops in revenue," ZenithOptimedia said in a statement released July 6.
A recovery in North America may not be seen until 2011; ZenithOptimedia believes the U.S. and Canadian advertising market will shrink an additional 2.4 percent in 2010.
For the marketer who hasn't yet launched a Hispanic marketing effort for their company, the gloomy forecast may present an unprecedented opportunity.
"An advertiser that is interested in getting into the Hispanic market can go in and do a test and get it for a substantial discount, compared to what it would have cost two years ago," says Don Parsons, a veteran Spanish-language media sales executive who is now president of sales for the recently rebranded television operation CV Network.
"In the Hispanic market, we've never had years with minus growth - until last year," he notes. Therefore, a multimedia Hispanic market trial involving Spanish-language television, print and radio - paired with a promotional effort designed to "move case" - could bring a company additional revenue at a fraction of the cost it will take when the economy recovers.
A packaged goods advertiser not yet talking to U.S. Hispanics could easily accomplish this, Parsons says. At CV Network, the category remains one of the strongest. Pharmaceutical, telecommunications and beverages are among the other categories that continue to perform well for Parsons and his team.
There's also new business development, Parsons notes. "One category that continues to grow on a local level is healthcare and HMO," he says. "It's happening in all markets, including Puerto Rico."
While CV Network is seeing new business, Parsons believes the addition of first-time clients is not happening to the degree that it did in the past. He adds that this is likely the case for all Hispanic media in mid-2009.
The addition of healthcare and HMO dollars hasn't made up for the loss in automotive dollars seen across the entire landscape of Spanish-language media.
"The automobile manufacturers are spending on the network level, but the dealer associations are the ones cutting their budgets, and that hurts at the local level," Parsons explains.
A new entrant to Hispanic marketing today can also make a bold statement about their interest and commitment to reaching the Spanish-speaking consumer because of an overall air of caution among media buyers and CMOs already in the market.
"Instead of an annual budget, people are reviewing their expenditures on a quarterly basis," Parsons says. "Advertisers are just very cautious right now. Planning and buying used to be done far more in advance, but it is not happening."
Thus, it's "slow-growth mode" until at least the beginning of the fourth quarter for Parsons and CV Network. There are no predictions as to what 2010 has in store for the network, which operates in Miami and New York in addition to Puerto Rico.
That being said, Parsons says the Latino market environment is far richer today than it was a decade ago.
"The research is better, and there is more data," he says. "This will help a marketer understand the Hispanic market better than 10 or 20 years ago."
Parsons also points to a plethora of media options that was only nascent in 1999, including electronic media, print publications and in-store retail opportunities.
"I definitely think there is room for growth, and online opportunities represent major growth for the entire industry," he says.
Parsons also believes that one or two additional Spanish-language television networks will bow in the coming years, as existing properties evolve.
Sure, that's added competition for Parsons. But he welcomes the challenge.
"That means we will all have to work harder," he says. "We will have to offer a great product and offer our advertisers a multiplatform opportunity - especially the new advertisers."
Source: Hispanic Market Weekly
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