The Gillette acquisition by P&G isn't likely to have a negative impact on Hispanic newspaper and magazine ad revenues. The intense competition between consumer-product manufacturers and the lack of overlapping brands between the two companies make cuts in ad spending budgets unlikely. In fact, if current trends continue, ad industry observers say the merger could actually generate more ad spending – especially if the combined P&G-Gillette decides to cross promote its brands in the Hispanic market. In contrast, other recently announced mergers in the telecommunications (Verizon-MCI, AT&T-SBC, Sprint-Nextel) and retail sectors (see “How will the Kmart-Sears consolidation affect Hispanic print advertising?” page 9, Portada® No. 13, January 2005) are expected to result in reduced ad budgets.
While P&G targets primarily women (and is a heavy advertiser in women's magazines), Gillette targets mostly men. P&G has 16 products with sales of more than $1 billion each; Gillette has five. According to HispanicMagazineMonitor, about 50 P&G brands advertised in Hispanic magazines last year. During the first eleven months of 2004, P&G spent a total of US $9.7 million on Hispanic print (newspapers and magazines) and US $128.6 million on Hispanic TV, according to TNS/Media Intelligence. Gillette spent US $0.53 million in print and US $9.9 million on Hispanic TV. Both companies did most of their Hispanic print advertising in magazines. P&G spent US $10.8 million on magazine ad-space in 2004. The figure for Gillette was a much lower US $306,000. In fact, the tenth largest P&G brand (Vicks-NyQuil) bought more advertising in Hispanic magazines than all the Gillette brands combined.
TNS Media Intelligence data shows that both P&G and Gillette have steadily increased their overall ad spending over the past few years. In 2003, the last year for complete data, P&G spent $2.7 billion, up from $2.17 billion in 2002 and $1.76 billion in 2001. Gillette spent $336.3 million in 2003, up from $275.9 million in 2002, and $184.2 million in 2001. Gillette's Hispanic media buying is handled mostly by Latin Works Marketing. P&G works with three agencies: Worldwide, Saatchi & Saatchi/Conill Advertising, and Bromley.
NOTE: Most of the statistics for this article were provided by HispanicMagazineMonitor (www.hispanicmagazinemonitor.com). HispanicMagazineMonitor is a service of MediaEconomicsGroup, a firm that provides competitive intelligence for the Hispanic advertising and media industry.
P&G's top 10 brands by Hispanic magazine ad spending…
Crest "Whitening Expressions"
Clairol "Herbal Essences – Rainforest Flowers" Shampoo
Cover Girl "TruBlend"
Always "Maxi Regular"
Dawn "Lift Action"
Totals: (all brands)
Gillette "Sensor3 for Women"
Soft & Dri "Dri Gel with Microbeads"
Soft & Dri "DermaStripe"
Braun Thermoscan ExacTemp
Gillette "M3 Power"
Gillette "Satin Care – Dry Skin Formula" Shave Gel
Gillette "Satin Care – Jasmine Relaxation" Shave Gel
Gillette "Satin Care – Oceania" Shave Gel
Gillette "Venus Divine" Razor
Totals: (all results)