Hardly a week goes by lately without H Code Inc. announcing a deal with a Hispanic media publisher.
“No one has doubled down and invested into the digital U.S. Hispanic space in the last 18 months more than H Code,” declared Parker Morse, chief executive officer of the Santa Monica-based company.
H Code is a matchmaker that connects digital platforms such as lifestyle website HipLatina – which it bought June 26 – with advertising agencies. The connection provides the ad shops options to place creative content suited to a Hispanic-focused platform – with Hispanic defined as people in the U.S. with a Latin American ancestry.
The emergence of H Code and similar companies – including Santa Monica-based television and radio station owner Entravision Communications’ Pulpo –comes with a tinge of irony.
Hispanic-focused, matchmaking companies might be an emerging force, but Hispanic-focused advertising agencies – the companies who make the ads – are on the decline.
“The specialization in Hispanic advertising now is on the back end, rather than the front end,” said Mario Carrasco, principal of ThinkNow, a Burbank-based research and consulting firm.
Carrasco and others immersed in the Hispanic advertising market in Los Angeles give a number of reasons why growth in the Hispanic advertising market is not coming from traditional advertising agencies, with demographics, a paradigm shift among marketers and advertisers, and consolidation chief among them.
Los Angeles County is a bellwether for the Hispanic market. About 48 percent of the local population is Hispanic, a share that has risen steadily since the 1980s.
A closer look at the population, though, suggests why the need for ads that are created specifically to appeal to the Hispanic population here is down. The number of U.S.-born Hispanics in L.A. is now almost double the total of immigrants, according to Pew Research Center’s Hispanic Trends division.
Los Angeles Hispanic advertising shops that were opened in the ‘80s – La Agencia De Orci & Associates and Acento Advertising Inc., among others – offered a niche service that appealed to first-generation, Spanish-speaking immigrants.
They “advertised in Spanish and in Spanish local newspapers, Spanish local TV stations, and Spanish local radio,” explained Isaac Mizrahi, the executive director of the Culture Marketing Council, formerly the Association of Hispanic Advertising Agencies.
One of Orci’s early accounts was with the U.S. Immigration & Naturalization Service, explaining the 1986 immigration reform law to Spanish-speaking immigrants.
Los Angeles Hispanic advertising agencies increased as immigration from Latin America grew. The trend was reliable for more than 20 years according to Jose Villa, president of Sensis Agency, who pegged 2006 as the peak year for Mexican immigration.
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