Direct Mailers Search For Ways to Get Closer to Latino Homes
Direct mail might be the last great frontier in the development of Hispanic print media. Despite its importance to certain sectors like financial services, retail and consumer packaged goods companies; it is still excluded from most Hispanic advertising statistics. Both Hispanic specific direct mail companies, such as Latin-Pak and Carmen's Cupones, and general market giants (ADVO, Harte Hanks, and Valassis) are optimizing their products in order to convince advertisers of their ability to target Hispanics.
The US Army is already convinced. It uses direct mail for roughly 25% of its Hispanic recruiting effort. According to Simmons Research, while the average consumer receives 350 pieces of English-language direct mail per year, Hispanic consumers receive only 35 pieces – or one-tenth as much. The scarcity of direct mail envelopes in Hispanic mailboxes tends to improve responsiveness. According to a recent study by NFO World Group, 59% of Hispanics reported making a purchase in the last 7-days based on a piece of printed ad mail, compared to 51% in the general market. This does not mean that direct mailers should expect a 59% response, but that 59% of respondents indicated that direct mail drove a purchase decision during a 7-day period. TV and radio had substantially lower response rates.
As many of its competitors, Windsor, CT based direct mail giant ADVO is still developing its strategy for targeting the Hispanic market. ADVO is evaluating the possibility of using its weekly ShopWise shared mail program, which is distributed to approximately 60 million households nationwide. They use census data to determine which neighborhoods have the highest Hispanic penetration. Advertisers, generally retailers or CPG companies, ask for around 80% Hispanic penetration. ADVO is building a model that takes into consideration geographic barriers, ethnicity and economic factors, and targets Hispanic households down to areas containing approximately 3,500 households (The average zip-code has 15,000 households). By targeting below the zip code level, ADVO can target the desired demographic more precisely. “National advertisers could do a segmented national buy of between 1 and 3 million households,” notes Matthew Drinkwater, national advertising sales director at ADVO.
ADVO does have a small Hispanic specific program. In 2002 it rolled out ShopWise Valores in the Houston area, which is distributed to 128,000 households twice a month inside the ShopWise wrap. To promote ShopWise Valores, ADVO partnered with the Spanish Broadcasting Corporation. ShopWise Valores had mixed results, partly because it lacked a large Spanish-speaking sales force.
ADVO competitor Newsamerica (publisher of Smartsource Magazine, an FSI in 635 newspapers and 27,000 supermarkets, drug stores and mass merchandiser locations across the US) does not have a direct mail program specifically targeting Hispanics.
Thinking About You
Harte Hanks, another direct mail giant, targets Hispanics via a monthly insert called “Pensando en Ti” (Thinking about you), which can be found inside the PennySaver weekly shopper in Southern California (1.1 million households) and in its Flyer product in South Florida (400,000 households). “Pensando en Ti” can target customers down to a few mail carrier routes.
Because of its regional footprint, Harte Hanks tends to have more local advertisers than ADVO. Does Harte Hanks have plans to go national? “Our main mission is to be able to communicate coupon redemption rates to advertisers,” Jami Delperdang, vice president of national accounts at Harte Hanks, tells Portada®. Once it has a better understanding of coupon redemption among California and Florida Hispanics, Harte Hanks will consider targeting Hispanics in other markets with a variety of vehicles, but mostly through direct mail. Delperdang does not rule out partnering with newspapers, but said she would prefer regional shopper publications.
Valpak Direct Marketing, owned by Cox Target Media, does not currently target Hispanics. “Clients have expressed virtually zero interest in reaching the Hispanic market,” says Marty Leach, media specialist at Key Largo, FL based Cox Target Media. “We are known as a local ‘neighborhood' advertising medium. We are sold by 200+ local franchise sales offices who take out advertisements for mostly local retail and service merchants,” explained Leach. “Each Valpak delivery territory is designed by the local franchisee.” Valpak's national circulation is approximately 40 million. “This circulation is not proportionate to ethnic or racial mix within markets,” he adds. However, Meg Forehand from corporate communications at Cox Target Media saidthat some of the Valpak franchises do reach Hispanics on a local community level, particularly those in Texas, South Florida and Southern California.
While Valpak, Pennysaver and ADVO are mass marketed direct mail vehicles, Livonia, MI, based Valassis works on customized programs for the general and Hispanic markets. “Our Hispanic direct mail programs start with a few 100,000, for instance a section of Los Angeles, and can go into the millions,” says Joseph Lampertious, director for new business development at Valassis. “We have done programs for CPG companies, grocery retailers, automotive, and franchise food retailers,” says Lampertious.
To deliver to an advertiser's target audience, Valassis usually starts out with a database, sometimes provided by the advertiser (e.g. a frequent shopper list from a retailer or a customer database from a CPG company), it then uses a database filtration process, involving 15 different criteria (purchasing power, number of household members, tastes, consumer patterns, etc.) which it checks against databases including the last 50 years of immigration records.
To refine the results even more, the resulting list can be bumped against the subscriber list of a Hispanic publication. If, for instance, the advertiser's desired target is Spanish-dominant, the list will be bumped against the subscriber list of a Spanish-language magazine (e.g. People en español). Because of their “customized” approach, Valassis charges higher rates than its mass market competitors (CPMs range between US $100 and $350 depending on list acquisition, sampling, etc...).
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