Six Things You Need to Know About Geoscape’s Acquisition by Claritas

What: We talked to marketing experts at research agencies and media about the recent acquisition of Geoscape by  Claritas.
Why it matters: The market for multicultural research and data has changed tremendously over the last few years. The Geoscape move provides clues for what's coming next.

Much time has passed since the last Geoscape merger...

More than ten years have passed since Goldman Sachs Urban Investment Group announced in June 2007 that it was merging  Latin Force LLC, a Hispanic marketing strategy firm, with multicultural intelligence and data analytics company Geoscape International (with the new company to be called Latin Force Group). The new company was called LatinForce. Back then, Goldman Sachs Managing Director Kevin Jordan said, “The merged company will provide its existing and future customers with a clear competitive advantage in reaching America’s fastest-growing demographic.”

What has happened since is clear. A few years later, Latin Force Group was renamed Geoscape and just a week ago, it was sold to Claritas, a portfolio company of the Carlyle Group: Geoscape by New MainStream Capital (a spin-off of the Goldman Sachs Urban Investment group).
Six things you need to know:

1. Major Investors are Betting on Data and Market Research

The Carlyle Group, one of the world's largest private equity and asset management firms, bought Claritas from Nielsen early last year. Claritas is focused on consumer segmentation insights. It provides marketers with a comprehensive view into consumer behavior patterns through proprietary segmentation analysis powered by broad access to data sources. Multicultural research and data now also comes into the picture with the Geoscape acquisition. “Marketers must find ways to connect with these high-growth consumers in relevant ways.”, said Claritas LLC’s CEO Mike Nazzaro when the provider of consumer segmentation analysis announced a few days ago the acquisition of Geoscape, a firm dedicated to the in-depth understanding of multicultural consumers.

2. The Pendulum Swings Back to One-Stop-Shop

While multicultural audiences continue to be coveted by corporate America, the audiences and media to reach them are not specifically multicultural or Hispanic. In other words, most multicultural media buying decisions are no longer taken by multicultural specific agencies but by general market agencies. Similarly, multicultural research is increasingly demanded by major general market agencies who tend to have better connection with general market shops such as Claritas. It is in this context that Geoscape's acquisition by Claritas has to be analyzed.

 

Martin Cerda, founder of Encuesta, Inc. [Photo: Hispanic PR Blog]

3. Comprehensive Services Demand More Capital...

Claritas' acquisition of Geoscape is perhaps not that surprising as it could have been a few years ago. When multicultural research industry veteran Martin Cerda, founder of Encuesta Inc., joined Cheskin, a WPP shop, in 2011, everyone in the industry was surprised. When Portada asked him about his decision back then, he predicted that small marketing research firms wouldn’t be able to deliver the level of services required in view of the more and more complex media, marketing, and advertising conditions. “Specifically, fast used to mean taking a week to deliver results, now overnight or even real-time results are expected,” he said. The Geoscape acquisition is a sign that predictions like this are the new norm.

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General market research agencies will begin to bolster their multicultural capabilities through strategic acquisitions creating a new multicultural marketing research model.

 

4.... because Technology is Crucial.

“Today, marketing is mostly about data.  Research and insights that are culturally unique and relevant to Hispanics is more important than ever,” says Ballas-Traynor. “ However, the data sources and the way that we mine data has to align with the sources and the tactics used in the general market.” The research space answers to an ever-evolving market that becomes faster and more data-driven every day.

Today, Marketing is mostly about data.

Mario Carrasco

Companies will need to make sure they’re able to access those data. “Navigating in the new mainstream is going to require a big ship”, said Cerda back in 2011. And it would seem Claritas and Geoscape will be showing others on the right path, as explains Mario Carrasco: “The acquisition, I believe, marks a shift into the 3.0 multicultural marketing research era; general market research agencies will begin to bolster their multicultural capabilities through strategic acquisitions creating a new multicultural marketing research model”.

 

 

5. Hispanic Consumers Are No Longer Defined by Language

The key to how drastically multicultural marketing research has changed over the last decade, says Mario Carrasco, co-founder of Think Now Research, is that the first multicultural marketing research firms were able to easily differentiate themselves from general market agencies through language: “Hispanic ad agencies had the Spanish language as their key differentiating factor from general market agencies”.

The Hispanic consumer is no longer defined by language but by culture.

Carlos Cordoba

But what happened once immigration slowed down and U.S. born Hispanics accounted for most of the Hispanic population growth? In the words of Carlos Cordoba, marketing expert at Vision Strategies and Insights, “the Hispanic consumer is no longer defined by language but by culture, which means we need to communicate with them in the language of their choice.”
With their most obvious differentiator gone, suddenly small agencies don’t have enough resources to connect to Hispanic consumers and need powerful allies. “I need more and better resources, increased scale to execute new and emerging research methodologies,” said Cerda when he joined Cheskin.

 

6. Large Firms Need Multicultural Expertise

Lucia Ballas-Traynor

However, the need goes both ways. For Lucia Ballas-Traynor, Media and Marketing Executive at Hemisphere TV, “Today, marketing is mostly about data. Research that is culturally unique and relevant to Hispanics is more important than ever.” Big companies will need to find a way to get through to the ever-growing Hispanic population, and, as she explains, “it makes sense to acquire a company that has been doing this for decades rather than trying to build this discipline from scratch.”

 

 

 


Janet Grynberg

Janet has worked as a translator and editor for magazines and publishing houses including Expansion and Grupo Planeta since 2014. She is part of the Portada editorial team, and her main interests include literature, traveling, and exploring other cultures. Follow me on Twitter!

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