It is difficult to argue for or against the use of Hispanic specific Advertising Agencies. We looked at four factors, some against, some in favour:
Does the Efficiency Argument Make Sense?
The rationale for using a General Market Agency and not a Hispanic Agency to buy media goes like this: To realize major efficiencies in the media buying process it is necessary to put together General Market and Hispanic Market budgets. In practice, we do not think this is true. Hispanic targeted media, with the exception of NBC -Telemundo, and General Market Media do not share common ownership. Separate media buys are required to reach both markets. It is therefore impossible for media buyers to increase their bargaining power and obtain bigger discounts.
Hispanics Are the General Market.
In many states (e.g. Texas, New Mexico, California) Hispanics are close to being the majority of the population. Marketing campaigns that want to have mass appeal need to incorporate the all important Hispanic target audience. General market agencies have come to realize this and have started to employ Hispanic market specialists or have bought Hispanic Advertising Agencies.
Hispanic Agencies tend to have better insights/research on how to connect with the Spanish-dominant sector of the Hispanic population. This translates very well into their creative work. But some general market agencies have done great Hispanic work. Does it make a difference whether a General Market Agency has Hispanic capabilities, or, conversely, a Hispanic Agency has general market capabilities? We do not think it does: The business should go to whoever pitches it best.
While quotas are useful to increase the representation of particular groups and institutions during their early stages of development, companies should not shield themselves behind quota-arguments to advance their business interests. The Hispanic Advertising and Media sector has grown in sophistication and reached its maturity stage. Newcomers, (in this case, General Market Agencies) have to be embraced; In fact, their interest in doing Hispanic work is a vote of confidence in the Hispanic Market.
A few Hispanic Advertising Agencies have made a big fuss about the success of general market agencies in gaining Hispanic work. According to them, General Market Agencies are profiting from "our market" and undercutting Hispanic targeted advertising. A bit of self-critique is necessary here: Many Hispanic agencies have not been a good example of the "diversity effort" they now are asking Corporate America to undertake.Many Hispanic Agencies have put the vast majority of their clients' media budgets into two TV behemoths: Univision and Telemundo at the expense of smaller and more diverse Hispanic media outlets.