1. What publications have closed this year and why? 

Three come to mind right away. After two years of delivering news about Mexico to Mexicans living and working in the greater-Atlanta area, El Universal  Gráfico (weekly, circ. 50,000, Spanish) ceased publication. Mexicans living in Atlanta enjoyed boom times until recently, however the collapse of the housing market, the crackdown on illegal immigration and a draught that has crippled the landscaping business have changed that.

Estylo, a Los Angeles based lifestyle magazine, published its last issue in June.  Tu Ciudad, a regional English-language magazine targeting Affluent Hispanics in Los Angeles, which had expansion plans into other markets, closed in June by its parent company Emmis Publishing.

Other companies, like ad sales representative firm Papel Media, have changed their strategy and reduced their size.

2. Is it all bad news?

By no means. Hispanic newspapers and magazines are expanding. Only yesterday, Los Angeles’ El Clasificado announced that it is expanding into San Diego and Ventura County. Some newspapers, including daily newspapers have expanded their circulation. This is the case of Al Dia in Dallas/Ft. Worth which expanded its daily circulation by 80,000 last June.  

Interestingly, Hispanic newspapers often show circulation increases, backing general market trends. For instance, El Diario La Prensa of New York ranked first among U.S. daily newspapers with a circulation higher than 50,000 with a 7.6% increase  to 53,856 copies during the six month period ending March 2008.

Similarly, in November 2007, La Opinión of Los Angeles ranked first in net daily paid circulation growth among the 200 largest newspapers in America for the six-month period ending September 2007, based on the latest FAS-FAX.

There is excitement in the Hispanic print arena. This week a New England entrepreneur decided to convert its weekly Hispanic newspaper Siglo 21 into a daily. In addition, Express Media International, a UK based group decided to start a Florida Weekly targeting Hispanics, and earlier this year, Sea Latino launched a national newspaper in six markets.  

3. These are many launches and expansions. It seems that a line has to be drawn between the malaise of general market print media and Hispanic print ….

Definitely. Several factors explain this. For one, magazine and print advertising has a share of almost 30% of total general market advertising. In the Hispanic market that same share lies below 15%. The base is simply much lower and there still are significant expansion opportunities in terms of both circulation and   advertising in the Hispanic market. There also is a demographic reality, the Hispanic population grows at a much higher rate (and is significantly younger than the average U.S. population).  As Isaac Lasky, Marketing Director, of Al Dia Texas pointed out,Al Dia’s expanded circulation is an answer to the very rapidly expanding DFW Hispanic population. Being the only daily newspaper in the Dallas Ft. Worth metropolitan area we found an underserved market and advertisers told us that a larger circulation was important to reach critical mass and be able to capture this dynamic market segment.”

There is yet another factor. Many publications targeting the Hispanic market are community oriented. Community Newspapers are a sweetspot of the industry with only a slight downturn in advertising revenues: a 2.7% decline for the first quarter of 2008 against the same quarter of 2007. In fact, total ad revenues were up 0.5% (2007 vs. 2006) as compared to the overall industry decline of 7.9% as reported by the Newspaper Association of America., according to second quarter 2008 financial data collected by Suburban Newspapers of America (SNA). In other words, newspapers continue to be a paramount way to connect with the community, particularly on local issues.

4.  But the economic downturn must have affected Hispanic publications…

Definitely, Hispanic newspapers and magazines are also paying the toll.

Publishers surveyed by Portada say that the slowdown has had different effects depending on the market they operate in. Markets in which the real estate crisis has hit particularly hard (Florida, Nevada and Arizona), have had a substantial decrease in economic activity. The real estate crisis has hit them in two ways: On one hand, due to the lower economic activity (particularly in “Hispanic intensive industries” such as construction) general advertising spending has decreased. On the other hand, real estate display and classified advertising, an important source of newspaper revenue, has plummeted. 

Orlando Nieves, general manager of Media General’s Centro Tampa, reports the following: “After a disappointing start of the year, ad revenues have improved in the second and third quarters. The last two months (June and July) showed higher revenues than last year indicating an improvement led mostly by National ROP (+7.6%).  It has been trending better than expected with strong revenue in April and July.  Retail ROP is basically flat versus last year (+1.1%) while preprints have decreased by 25%.  The categories driving growth are Local Health Care, Grocery and Entertainment with a slight improvement in National Automotive.  Real Estate and Employment continue to be the missing piece”.

In some other markets, like California, local business seem to be doing relatively well, but national advertising has declined (particularly the FSI or pre-print business). To remedy this situation, some Southern Californian Hispanic newspapers have talked about forming an alliance to do a Southern Californian print buy, which may be enticing to national advertisers due to the large Hispanic population.  

5.  What Advertising categories are being hit?

Obviously employment and real estate and without a doubt automotive. Lower disposable income has had the effect of reducing demand for cars (for more information read the article on Automotive Advertising in the current Portada issue). Slower Automotive classified advertising has also impacted  Hispanic newspapers. Automotive advertising represents more than 12% of overall U.S. Advertising. The slowdown has impacted magazines that mostly target Men. However, magazines operating in other categories like insurance (State Farm) or fast food (Mc Donald’s) are stronger.

Some recently launched  magazines seem to be fairing well: Chevrolet, Coca-Cola and Mexicana Airlines have bought ads in Spanish-language magazine Constru-Guia al Dia.  

In addition, some national advertisers skip some areas of the country. For instance, companies like Loews and Rooms To Go, have advertised to Hispanics in Texas and California and not been present in markets like Atlanta.

6. How does immigration reform impact Hispanic publications?

The tougher regulations in some states (e.g. Arizona and also Washington DC) have made living and spending more difficult for undocumented Hispanics. This has had a detrimental effect on some businesses which advertise in Hispanic publications. In addition, car dealership advertising has suffered because many states now make it compulsory to be documented in order to get a drivers license.

7. Do independently owned publications have an advantage over newspaper chains that own Hispanic publications?

There is a difference between publications that were started from scratch by large newspaper chains, those that were bought out and those that are owned independently. Hispanic newspapers owned by large chains tend to get a large amount of advertising from advertisers in the sister general market publication, particularly if they were not bought out by them (e.g., Washington DC’s  El Tiempo Latino by the Washington Post Company ) but started from scratch. Independent publications and newspaper groups like Impremedia tend to have more stable businesses because they have an established clientele and a direct relationship with it.

General market chains like Cox Newspapers are having to sell some of their Hispanic properties in an effort to raise money or because they are focusing on other areas (e.g. Cox Newspapers selling Ahora Si in Austin and La Palma in Palm Beach).

While general market newspapers are going through difficulties, and cost cuts often include their Hispanic publications, the leaders of these companies often realize that their Hispanic ventures are a way to tap and learn in a market that in some areas of their footprint amounts to most of the readers (e.g. Belo’s Al Dia in Dallas/Ft. Worth, McClatchy’s La Estrella in Dallas/Ft. Worth and Houston Chronicle-La Voz in Houston etc..).

8. Where does the main opportuniity lie? 

In the realization that print media vehicles targeting Latinos are underutilized by both local and national advertisers. This also applies for digital media. Advertisers need to learn in a sophisticated way how the use of print and digital media increases their ROI.

For Case Studies on Big Box Retail Advertising, CPG Advertising, Healthcare Advertising   and a Special Panel on “How to Increase the share of digital and print media advertising dollars” join us at Portada’s Second Annual Conference in NYC, Oct. 9. (Download the Conference Program here) .

Related Article:

Javier Aldape: Hispanic Print Market in Context


Portada Staff

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