For marketers hoping to attract Hispanics to their websites for e-commerce and branding purposes, paid search advertising makes a lot of sense. Publishers, particularly Yellow Pages directory publishers, are still figuring out how to best use this powerful marketing tool.
Ignacio Hernandez, president of iHispanic Marketing Group in La Jolla, California, says that every year companies lose billions of dollars in potential sales to Hispanics because they underestimate the size and power of the market. “US Hispanics spent $5.6 billion online in 2003. It takes a lot more than good Spanish to get a chunk of that money,” says Hernandez.
Hernandez says it's possible to get very high traffic volume keywords for a fraction of the cost of English keywords. He advises careful research when it comes to choosing Spanish keywords and phrases that might not necessarily be direct translations.
Hernandez says Mexgrocer.com has done a good job of optimizing its Internet presence and increasing the effectiveness of paid search advertising. Mexgrocer, the largest online Mexican grocery store, sells over 1,000 items, including Mexican food, cook books and cooking utensils, on its bilingual website. MexGrocer executives realized that Spanish only users made up just 5% of their total traffic. The other 30% of Hispanic users were comfortable navigating the site and purchasing products in English. Based on this information, the site was totally redesigned using search term theme pyramids, bilingual at the product level with English navigation tools. As a result, total traffic increased over 250% and organic search engine traffic increased from 26% to 62% of total traffic.
More media companies are choosing to add Spanish-language search engine functionality. Last July, Google and Univision.com entered a partnership to display search engine functionality on Univision.com. The website allows users to do keyword searches in English, English and Spanish or just Spanish.
Challenges and opportunities for Yellow Pages publishers
Search engines like Google and Yahoo are not the only ones offering consumers local search services. The Yellow Pages have been around for over 100 years and have worldwide sales of US $26 billion. According to The Kelsey Group, 22 million small and medium-sized businesses spend 46% of their advertising budgets on Yellow Pages marketing, and put only 3% into search engine keywords.
Most Yellow Pages publishers reach online audiences through their Internet Yellow Pages (IYPs). Print Yellow Pages directories offer electronic and online versions that provide contact information, driving directions, special promotions, links to advertiser websites, and other Web-enabled features.
Verizon SuperPages.com, which has been selling online directory listings since 1996, recently redesigned its website and business model to include pay-per-click listings. Verizon also publishes the Spanish-language directory http://espanol.superpages.com.
To create a better search experience, many analysts believe local searches will become hybrids of Yellow Pages and search engines, combining the strengths of content and distribution. This trend is apparent in the recent strategic partnerships between Verizon SuperPages and FindWhat, Switchboard and InfoSpace, and the Yellow Pages Group and Google.
How big is the Hispanic Internet paid search ad market?
According to 2002 data collected by Google, 18% of their searches were in Spanish. Investment bank Piper&Jaffray estimates that the worldwide paid search advertising market will have a volume of US $7 billion by 2005. Taking Google's 18% Spanish-language search figure and applying a conservative 10% factor (due to the fact that Spanish-language Internet is less commercialized than English-language Internet), we get a worldwide (Spain, Latin America and US Hispanic) Spanish-language search engine ad market volume of US $126 million.
Assuming that the US Hispanic market accounts for 60% of that, we get a US Hispanic (Spanish-language) paid search ad market volume of US $75.6 million. Nacho Hernandez, president of iHispanic Marketing Group in La Jolla, California, says he is comfortable with this figure. He adds that while research firms provide estimates for the volume of Hispanic online advertising (banners, buttons, etc.), they almost never do so for the Spanish-language search engine ad market.