The Latin Club

Veronico Trujillo was hungry for a handmade tortilla. But he couldn’t find a good one, so he opened a small shop in Los Angeles called La Tortilleria Guerrero, using a recipe he remembered from Mexico.

That was in 1973. Today, Guerrero is one of the top tortilla brands in the United States, and it has doubled its annual sales in five years. But the firm now owned by Mexican giant Gruma Corp. still faces many challenges in reaching its core audience.

“It’s different when you take a brand that has been in Mexico forever and bring it back to people’s lives,” says Andres Reyes, group account director for Guerrero at Lopez Negrete, an Hispanic marketing agency. “Our biggest challenge is that we have a brand born in the U.S.”

So how does Guerrero promote itself? One way is through event marketing.

It hands out samples, coupons, branded aprons and other items at events like Cinco de Mayo, Mexican Independence Day and Las Posadas (a pre-Christmas celebration). And it recently partnered with Mexican chef Alfredo Oropeza to conduct cooking demonstrations at stores across the country.

The firm sent a mobile kitchen designed in an authentic Mexican fashion, to 20 retail outlets in 14 locales in Georgia and North Carolina before ending last month in New York. The kitchen was set up in parking lots next to a tent where customers could spin a wheel to win prizes and receive giveaways.

A cookbook, written in both Spanish and English, was awarded in exchange for the proof-of-purchase of two Guerrero products. It featured 12 recipes from Chef Oropeza.

The campaign was supported with P-O-P materials, merchandising displays and shelf talkers with tear pads, and in-store announcements that the events were underway outside.

What is the company getting out of this? Plenty.

For one thing, it was able to collect consumer information from those who signed up to receive the branded cookbook. And it made inroads in markets like Georgia, where Latinos make up only 5.3% of the population, and New York. The latter is especially tough because the majority of the Hispanics there are not of Mexican origin.

“Our consumers walk or take public transportation,” says Norma Rojas, director of marketing for Guerrero, who was born and raised in Mexico City. “If they don’t find the tortilla brand they like, they won’t go look for one someplace else. You cannot just have a one-size-fits-all strategy.”

That’s for sure. Hispanics are the fastest-growing ethnic group in the U.S. — in 2004, the U.S. Census Bureau counted 40.4 million, and that number is expected to grow to 102.6 million by 2050. But they are hardly a monolith.

Mexicans, who comprise 70% of the total, are the single largest group. But Cubans and Puerto Ricans also make up huge markets, and there are more than 30 smaller segments.

Hispanics can also be divided into those who speak Spanish exclusively, those who use it only at home, and those whose first language is English. And loyalty marketer Colloquy has identified economic units like “emerging Hispanics,” those with household incomes below $40,000.

“We don’t think anymore that it’s really a matter of how long they have been in the U.S., but to what degree they are moving in and out of the two cultures,” says Jackie Bird, chairwoman of the Association of Hispanic Advertising Agencies (AHAA). “We’re seeing a much more defined approach to targeting Hispanics by understanding and insights of the consumer and then creating messaging accordingly.”

Hispanic purchasing power is expected to reach $928 billion this year, up from $700 billion in 2005. And marketers have taken note. They now spend $4 billion on advertising to Hispanics, 5.2% of the average budget. And that number has risen from 3.6% in 2000, according to AHAA.

For its part, Guerrero ranks with mainstream brands in its use of promotional tactics. It develops sweepstakes for retailers like Food for Less, a chain located in California and Nevada. The purpose of that effort? To support the cooking demonstrations held there.

And the firm recently launched www.TortillasGuerrero.com. Visitors could find information about the brand, the cookbook offer and the locations of the events. Mexican recipes can be downloaded, as can $1-off coupons.

The key to success? Authenticity.

“We’ve heard over and over again this nostalgia for what they left behind,” Rojas notes. “Tortillas not only remind Hispanics of their heritage, but for moms, the tortilla is a way of passing down tradition.”

The company has also done some cause-related marketing, donating a total of $75,000 — or $5,000 each for the markets where Chef Oropeza prepared food — to local Hispanic organizations. The money was handed out with great ceremony during the cooking sessions.

All of this was done working with the retail partners. The press was told in advance about the donations, and that often resulted in brand-building coverage.

“You’d be amazed what PR does,” Rojas says.

TOYOTA

Toyota had another challenge when it entered the Hispanic market 20 years ago: Spanish-language TV and radio were the main advertising vehicles, and they had limited reach. But the automaker has added interactive components and recently began conducting events and promotions.

For the launch of its Tundra this year, for example, it staged concerts featuring regional Mexican music in 19 cities and 40 venues. It also sponsored Charreadas, a Mexican-style rodeo.

But the centerpiece of these events was the vehicle itself. Research showed that Hispanics love pickup trucks, so Toyota displayed the vehicles and held games to explain their torque and strength.

And at the rodeos? Visitors can step into a mobile museum to view information on the history of the sport.

There’s one more thing: consumer information is collected at all events for future marketing.

“We really have opened up the effort to communicate to this consumer where they are at,” says Carlos Martinez, executive vice president and general manager of Conill Advertising, a multicultural advertising agency, that handles marketing for the firm.

For another vehicle, the subcompact Yaris, research sent the company in search of a different market segment, the young and acculturated, including non-Hispanics. Toyota sponsored The Road to Success, a series of career fairs at universities. Students were able to meet with counselors of nontraditional careers such as photography and music.

And online? The firm launched Mudo Yaris, or Yaris World, at www.MundoYaris.com, a site with copy in both English and Spanish. The youth-oriented community lets visitors sign up to chat with friends or create avatars and blogs. Users can go to a music lab where they can create their own music videos and send them to friends.

To determine the success of such efforts, Toyota tracks leads generated and monthly sales lifts and makes tweaks to the campaigns if it doesn’t see the response it wants.

“Instead of doing the shotgun approach — going after everyone — this is really a direct approach,” Martinez says. “It may be less concentration, but it’s the right people that you want to get. If we have done our homework things have paid off, but we adjust if the numbers are not there.”

And in July, Toyota launched the Highlander sport utility vehicle seeking an even different Hispanic: an upscale Spanish-speaking buyer who wouldn’t shy away from the $29,000 starting price.

Martinez says interesting insights found that this more sophisticated consumer appeared to like to sing their own praises. They felt they could dance better than most. That their coffee and food was better than others. And, that they enjoyed life more fully. With this insight the campaign Saber Vivir (know how to enjoy Life) was launched.

Thirty-second TV spots broke last month showing three couples traveling in a Highlander to a place certain to reinforce the notion of the good life: a spa. The conversation focuses on enjoying life. The spots are airing on Telemundo and Univision.

In addition, in a twist on the traditional TV spot, Highlander is running a podbuster during the new Telemundo novella, Pecdos Ajenos (Other’s Sins). Called the Extended Kiss, the spot runs at the end of the soap opera showing an unseen, extended version of the best scenes from that night’s programming, such as a long kiss or sports match.

The tag line reads: “Brought to you by Highlander for those of you who know how to enjoy life.” The TV spot follows. A tie-in with People en Español featured a special section where celebrities talked about the good life.

Has it worked?

Toyota is now Numero Uno, with 20% of the U.S. market share among Hispanics. One in every five new vehicles sold to a Latino is a Toyota. Nissan follows with 11%.

Toyota has “an advantage,” Martinez says.

Budweiser

Then there’s Bud.

Anheuser-Busch began distributing P-O-P materials in Spanish around 1885, according to company lore. Today, Bud Light is No. 1 and Budweiser is No. 2 among Latinos. And Bud Light has a higher market share with Hispanics than it does with the general population, says Henry Dominguez, who had been vice president of Latino marketing until last month, when he was named vice president of sales for the southwest business unit for Anheuser-Busch.

The brewer’s Hispanic marketing engine runs at top speed, with messaging often crafted around specific countries of origin.

At retail, for example, the creative is themed and focused on how the Latino consumer lives and shops across various parts of the country. The firm works with 600 distributors to understand each retail environment and the origin of the Hispanics shopping there. It then creates a different set of promotions based on those distinctions.

In one location, it used green screen technology to take photos of consumers that looked as if there were standing alongside members of the Mexican national soccer team. The photos were printed within minutes and handed to the shoppers to take home. Anheuser-Busch sponsors the team.

“It can be tricky is to maintain the brand’s positioning and strategy across the entire market,” says Dominguez. “As the Latino marketplace grows and the sophistication of the consumer and competitive pressure changes, our budgets have gone up.”

In the end, it all comes down to something Veronico Trujillo obviously knew.

“If you understand these consumers, you will be able to talk to them,” says Martinez.

The Latinization of America

Ten years ago the general population was influencing Hispanics. Today, the tide is shifting fast.

Justin Timberlake is recording songs in Spanish. J-Lo made it fashionable to wear tight, low-rise jeans, regardless of the size of your rear end. Mexican, Cuban and other Latino dishes are routinely prepared at home by the general population. And rumor has it that sales of tortillas have surpassed those of white bread.

Yankelovich recently released a study on multicultural marketing that found:

• 44% of non-Hispanic whites agreed that Hispanics are influencing everyone’s lifestyle, up from 37% in 2004.

• When Hispanics were asked what aspect of their culture or traditions they felt are most important to preserve, 62% cited music (48% in 2003); 61% said foods and beverages (36% in 2003).

• 75% of Hispanics said their roots and heritage are more important to them today than they were just five years ago, versus 43% of non-Hispanic whites.

• 60% of Hispanics said they enjoy looking at or listening to advertising versus 30% of non-Hispanic white consumers.

• 62% of Hispanics reported being overwhelmed by all of the sources of information today, compared to 45% of non-Hispanics.

• 58% of Hispanics reported going online and using the Internet everyday or almost everyday compared to 51% in 2003. Three-quarters of non-Hispanic whites reported this use, versus 71% in 2003.

• 79% of the Spanish respondents said they are unwavering in their commitment to extended families, versus 44% of bicultural Hispanics. “This is a group [bicultural Hispanics] who are forging a whole new culture,” says Sonya Suarez-Hammond, vice president multicultural marketing insights for Yankelovich.

“Marketers need to recognize that Hispanics preserving tradition is a growing source of pride, commonality and connection,” she adds. “As the general population continues to borrow from Hispanic culture, marketing messages must stay authentic and real when communicating to Hispanics.” — Patricia Odell

Source: The 2007/2008 Yankelovich Monitor Multicultural Marketing Study