While many of these Hispanic Americans are multigenerational, quite a few are relatively new to the country. These millions of citizens are creating their own American experience and, from a Marketing Communications perspective, brand preferences. As a marcomm professional, I think this incredibly flourishing market has been heavily underserved; especially in the case of DTC advertising.
Big pharmaceutical companies have dabbled in Hispanic language communications but I don’t believe any one company has established a true rapport with the Hispanic market. There are a number of reasons for this lack of a concerted effort but the sheer size and spending power of this group can’t be ignored.
The Hispanic DTC marketplace was already lucrative, but the Affordable Care Act has merely made it more so. Prior to enactment, 71% (39 million) of all Hispanics had health insurance coverage. ACA now allows for an additional ten million the opportunity for adequate health insurance. Within the first sign up period, roughly one million (10%) are now covered via ACA. Looking at it from another perspective, Hispanics made up 20% of all ACA signups (111 index relative to the percentage of population they make up). This means there is currently an opportunity market of 40 million people, with an upside number of around 49 million. The upside number is a plausible reality, as a Univision Communications Inc. study indicates more Hispanics are likely to sign up during future enrollment periods as positive word of mouth spreads in their communities.
Looking at the value of the market from a Healthcare spending standpoint gives greater clarity into the size of the opportunity for DTC marketing campaigns. IHS Global Insights 2013 Hispanic Market Forecast indicated Hispanics spent $40 Billion on “out-of-pocket” healthcare expenditures. If the additional ACA enrolled population spent at the same OOP rate ($1,025 per person) that would equate to one billion dollars in additional expenditures.
A trend analysis of the Hispanic DTC market also highlights the upside potential for long term efforts. Historically the preponderance of DTC efforts has focused on the 50+ market. According to US Census statistics 30% of all growth among 50+ aged US citizens will come from Hispanics. That same IHS Study states Hispanic Healthcare expenditures will increase by 53% between 2010 and 2015, compared with 22% for the general population.
With prevalence levels much higher within Hispanic households for certain disease states like diabetes, heart disease and HIV, failing to promote drugs directly to this audience is a big mistake. There are also a host of other maladies that have a clear DTC “white space” due high prevalence and lack of Spanish-language advertising.
Marketers should use the ACA’s enactment as a moment of reassessment as to how they view their DTC communications strategic approach to Hispanic Americans. The market dynamic is changing quickly, and the vast opportunity to increase the size of the market for many branded treatments is right in front of DTC advertisers’ eyes.
Mark Means is the VP, Director of Communications Planning at Underscore Marketing, a boutique firm that creates and manages digital marketing programs. Mark is a 20-year veteran of media planning. He has worked for a solid cross-section of media agencies, including Maxus, PHD, MPG, Initiative, Media Edge and Mindshare. His media experience runs the gamut from packaged goods to retail to automotive to financial to health. You name it and he has most likely had experience in that business segment.