Media Economics Group: top advertisers spend one third of multicultural budget on Hispanic magazine ads in 2006

Posted by Elena del Valle on March 6, 2007

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Graphic: Media Economics Group

The Media Economics group tracked 2,494 advertisers last year to discover they spent $693.0 million in 2006 to reach multicultural consumers via African American and Hispanic magazines. On average, these advertisers spent nearly two-thirds (64.8 percent or $449.2 million) of their budgets on African American magazines with the balance (35.2 percent or $243.8 million) on Hispanic magazine ads.

These estimates are based on an analysis of the nearly 100 multicultural magazines tracked by Media Economics Group’s BlackMagazineMonitor and HispanicMagazineMonitor competitive intelligence services.

The top five advertisers studied by the Media Economics Group in African American and Hispanic magazines in 2006 were: Procter & Gamble ($46.5 million), L’Oreal USA ($24.7 million), General Motors ($24.1 million), Clorox Company ($13.6 million), and Ford Motor Company ($13.6 million). The bottom five advertisers (among the top 100) in terms of total multicultural magazine spending in 2006 were: Burger King ($1,321,287), Walt Disney ($1,339,986), JC Penney ($1,341,350), BellSouth Corporation ($1,343,881), and Heineken USA, Inc. ($1,362,415).

According to the Media Economics Group findings, there was a wide variation in how the largest advertisers divided their budgets between African American and Hispanic magazines. Some companies spent more than average on African American magazines in 2006. Examples, include: Rocawear (98.8 percent of spending in AA magazines), Pfizer (93.4 percent), PepsiCo (91.6 percent), Nike (89.6 percent), K-Swiss (85.5 percent), American Express (79.1 percent), and Kraft Foods (78.3 percent).

Other advertisers spent a higher share on Hispanic magazine ads than on African American magazines in 2006. These include: JC Penney (98.9 percent of spending in Hispanic magazines), Fruit of the Loom (92.0 percent), Hyundai North America (89.8 percent), Cingular Wireless (80.0 percent), Sears, Roebuck & Co. (76.6 percent), Sara Lee Corp. (72.5 percent), McDonald’s (62.6 percent), Unilever (57.8 percent).

Although the top 100 advertisers are targeting Hispanics and Blacks via magazines, last year most mid-sized advertisers focused exclusively on one segment. Two-thirds of the 604 advertisers who spent between $100,000 and $1 million in 2006, advertised exclusively in either African American or Hispanic magazines.

“While this strategy may make sense for some advertisers to efficiently reach their targets, it may suggest that many exclusive advertisers (e.g. adidas, Citizen Watch Company, DirecTV, Playtex Products, Reebok, S.C. Johnson, Splenda, Wendy’s, etc.) are missing opportunities to reach part of their markets. Savvy publishers should target those exclusive advertisers to increase market share and generate new spending in their segment,” said Carlos Pelay, president of Media Economics Group.

Media Economics Group provides multicultural advertising competitive intelligence for advertising agencies, their clients, and publishers. Clients include leading advertising agencies and media companies active in the multicultural market.