Success requires a broad range of well-designed, culturally sensitive initiatives

Great potential and growing pains. That’s what the 42 million-strong Hispanic market in North America means to many companies. The economic potential is obvious, but far too many businesses have not been able to take advantage of the opportunities presented by this increasingly sizeable and powerful audience.
Lacking marketers with a deep understanding of the diverse Hispanic community, these companies struggle to understand, much less capitalize on, unfamiliar cultural norms and unique consumer habits and preferences. Efforts to tap into this enormous consumer demographic are father hampered by confusion about the best venues for advertising and interactive marketing campaigns that lose much in translation. As a result, despite tens of millions of willing Hispanic buyers and the best intentions of many companies, the market remains underserved in many places.
Although the challenges of targeting the Hispanic market are great, the payoff for getting it right is significant—the operative phrase being “getting it right.”
There is no better place to learn by example than to start with companies widely regarded as “best in class” in Hispanic marketing. Look closely, for example, at the practices of such market-leading organizations as Western Union, Procter & Gamble, General Motors, Anheuser Busch, Bank of America, Heineken, AOL Hispanic, McDonald’s and Wal-Mart.
Bank of America, for example, is launching its new Efectiva Visa Platinum, a full-service rewards credit card designed for Hispanics. The card offers bilingual services that include welcome kits, a reward-redemption site, program materials, communications, check offers and monthly statements. The company also has begun offering customers free wire transfers to Mexico to expand its business with the growing Hispanic population.
General Motors has launched a large-scale Hispanic initiative entitled “Real Everyday Pros” for its new model Envoy Denali. The company’s Sólo GM campaign, launched during Univision’s Premio Lo Nuestro in February, claims GM’s leadership in areas of safety and security, innovation, quality and customer satisfaction. The campaign also includes an online component on the automaker’s Spanish-language site and a Spanish magazine initiative. Moreover, in the first six months of 2005, GM spent over $60 million on television and print advertising targeting Hispanics, who account for 6 percent of the U.S. auto market today—up more than 25 percent from the prior five years.
Wal-Mart prints weekly circulars in English and Spanish, and it has launched Viviendo, a quarterly magazine targeted at Hispanics. The company also has teamed with Sprint to offer to Hispanics prepaid wireless phone service featuring low-cost phone calls to Mexico. During Hispanic Heritage Month, Wal-Mart sold children’s educational materials and Hispanic Heritage calendars as part of the company’s ongoing “Latin Roots, American Dreams” initiative designed to build awareness and pride in Hispanic culture. And, the company is tailoring the shopping experience in Hispanic communities by offering a wider variety of fruits and vegetables as well as other products targeted for Hispanic customers.
These companies and other Hispanic market leaders know that success in this market requires more than simple translation into Spanish. It requires a broad range of well-designed, culturally sensitive market initiatives as well as organizational initiatives. Companies wishing to emulate these best practices leaders should:

Analyze carefully the growth potential in the Hispanic market and the return on investment for the company.

Make sure members of the top management team, including the CEO and chief marketing officer, take the lead in reversing underinvestment of resources in the Hispanic market.

Look beyond general marketing expertise (for example agencies and consultants) and hire Hispanic market experts in order to bring the capability in house.

Make sure those hires understand that success requires a holistic approach to marketing, including the ability to address not only cultural issues, but also issues like retail locations, call-centers, staffing and all the other capabilities required in an integrated marketing effort.

Evaluate whether to buy or build brands to get a toehold in the Hispanic market.
The overriding theme in these best practices is clear: Insofar as possible, successful entry and long-term growth in the Hispanic market requires an organization-wide effort to build a permanent capability in the segment. As with entry into any major market, the effort cuts across all major functions of the organization: marketing, finance, supply chain and more.

It is particularly important to build the infrastructure of talent. Not only will the annual investment cost a fraction of a major consulting engagement, but also the permanent presence of such talent provides continuity, makes it easier to attract additional talent, and enables the company to grow smoothly with the market.

Carla Palazio is a partner with Heidrick & Struggles International, a global provider of senior-level executive search and leadership consulting services.
Leanne Fesenmeyer is director of Talent Management for Heidrick & Struggles’ Global CMO Practice.